Medco expects to raise US$74 million in foreign loans

PT Medco Energi Internasional Tbk expects to raise about US$74 million in foreign loans from a Singapore-based bank to partly finance the construction of its two offshore rigs that will totally cost the company between US$80 million and US$90 million, Kompas reported on Wednesday.

Medco?s Financial Director Sugiharto said in Jakarta on Tuesday that the two offshore rigs, located around the Singaporean water, were being built by the company?s subsidiary PT Apexindo Duta Pratama Tbk. The construction works have begun since five months ago.

Speaking to reporters following the signing of a memorandum of understanding agreement (MoU) for the acquisition of the Yapen oil field in Papua from Continental Energy Yapen Ltd, Sugiharto said that the construction of the rigs were also partly financed by proceeds from the issuance of the company?s euro bond in March last year.

Sugiharto said that the loan to be raised from the Singaporean bank would mature in five years and would be disbursed in several trench. "The first disbursement will be made in December," he said. (*)