Washington, D.C./Tirana, Albania, May 11, 2009
—IFC, a member of the World Bank Group, has agreed to support the further privatization of the Patos Marinza oilfield in southern Albania to help revive an outmoded industry and promote the reduction of pollution in the area.
IFC has approved a US$50 million loan plus a special-purpose environmental-term loan of US$5 million to Bankers Petroleum Ltd, a Canadian oil and gas company. IFC may also make an equity investment of up to 12 million Canadian dollars. The European Bank for Reconstruction and Development (EBRD) is providing equal amounts.
Bankers Petroleum has been operating a small portion of the Patos Marinza oilfield since 2004. The current expansion of Bankers’ operation will modernize the oilfield, transferring specialized technical know-how and experience to a largely local workforce. This will contribute revenues to the Albanian government and help promote much-needed foreign direct investment in the country’s hydrocarbon sector.
“IFC’s financial support at this time of tight credit markets is vital to carrying out a large development project at Patos Marinza,” said Abby Badwi, CEO of Bankers Petroleum. “We particularly appreciate their expertise in helping us to involve other stakeholders in tackling the significant environmental remediation needs in the oilfield. In addition, this sizable long-term investment will allow our company continued access to competitive and sustainable financing arrangements to fund currently planned and future growth opportunities in Albania.”
Patos Marinza is severely polluted following decades of ownership by the state-owned operator Albpetrol. Bankers will clean up existing wells taken over from Albpetrol and help reduce pollution and oilfield-contamination risks as they expand their activities in the area.
“This project is a good example of how investing in the private sector can lead to tangible benefits for people on the ground,” said Somit Varma, IFC’s Global Head for Oil, Gas, Mining, and Chemicals. “While IFC provides financing to help improve recovery rates and accelerate domestic oil production, we also help the company to contribute to environmental remediation initiatives aimed at improving living conditions in the surrounding area.”
The United Nations Development Program has classified the Patos Marinza area as one of Albania’s pollution hotspots. As the clean-up takes a wider effort involving many more stakeholders than Bankers alone, IFC and EBRD have helped establish a multi-stakeholder working group to formulate environmental and social strategies and initiatives. IFC has engaged with Albanian ministries to secure their support and leadership on this initiative, as well as with the European Union to align ongoing initiatives.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous year. For more information, visit
www.ifc.org.
