Dubai, United Arab Emirates, 22 March 2024 —IFC today announced a $1.25 billion financing package alongside partners to Indorama Eleme Fertilizer and Chemicals Limited in Nigeria. The investment will allow Indorama to ramp up its fertilizer production and develop a port terminal for exports, supporting food production and food security across regional and international markets, while fostering job creation in Nigeria.
The financing package will fund Indorama's plans to develop a third nitrogenous urea fertilizer production line and a new shipping terminal at its operations in Port Harcourt. The new production line is expected to have an annual capacity of 1.4 million metric tons of urea, one of the most widely used fertilizers worldwide.
The $1.25 billion financing package includes a $215.5 million loan from IFC's own account; a $94.5 million loan through the Managed Co-Lending Portfolio Program (MCPP); and $940 million financing mobilized from other development finance institutions and commercial banks. Joining IFC as joint mandated lead arranger and lender is Sumitomo Mitsui Banking Corporation (SMBC), Singapore Branch.
Other lenders contributing to the financing include the African Development Bank, Bangkok Bank, British International Investment, Citibank, Deutsche Investitions- und Entwicklungsgesellschaft (DEG), DZ Bank, Emerging Africa Infrastructure Fund (EAIF), Rand Merchant Bank, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), Export-Import Bank of India (India Exim Bank), Export-Import Bank of Korea (KEXIM), the Standard Bank Group, Standard Chartered Bank, and the United States International Development Finance Corporation (DFC).
As part of the project, Indorama will implement a greenhouse gas (GHG) emissions strategy to reduce emissions at its petrochemical complex by 32 percent by 2026, including by significantly reducing gas flaring and other improvements. This strategy aligns with Nigeria's pledge to eliminate routine gas flaring by 2030 under the World Bank-led Global Gas Flaring Reduction Partnership.
Indorama's two operational urea fertilizer lines serve Nigeria's domestic market, supporting the country's agricultural sector, which accounts for a quarter of its GDP and employs about a third of its labor force. The new production line and terminal, which will help meet growing global demand for fertilizer, are expected to create up to 8,000 direct and indirect jobs.
Amit Lohia, Group Vice Chairman, Indorama Corporation, said, "We are grateful to our financial partners for their unwavering support and confidence. IFC has been a key partner for Indorama in Nigeria for almost two decades. This financing demonstrates the strong collaboration and alignment of interests between the public and private sector to drive sustainable development and create value for all stakeholders. Indorama remains dedicated to play a vital role in supporting global food security by ensuring consistent supply of high-quality fertilizers in Africa, and beyond, while contributing to Nigeria's broader economic objectives."
Manish Mundra, Group Director for Africa, Indorama Corporation, said, "The establishment of this fertilizer plant underscores Indorama's unwavering commitment to Nigeria's industrial growth, economic diversification, and leveraging its strategic geographic location. This landmark financing represents a pivotal moment in Nigeria's journey towards becoming a major player in the global fertilizer market. With the addition of this third line, Nigeria is prepared to significantly ramp up its export capacity, thereby enhancing its position as a key exporter of fertilizers to Africa and the world. Furthermore, the establishment of this fertilizer plant will not only address critical issues such as broader food security but will also stimulate agricultural growth and create employment opportunities in Nigeria."
Sérgio Pimenta, IFC Vice President for Africa, said, "Reliable access to high quality fertilizer is essential for food production and food security around the world. IFC's investment in Indorama, along with African, Asian, European, and American partners, signals our joint commitment to support the agriculture sector, Nigeria's economy, and the expansion of Indorama, an important supplier in the global food chain."
Monika Beck, Member of DEG's Management Board, said "Indorama is a long-term client, as DEG has been the first DFI to finance the company. This recent investment, again, underlines our trustworthy cooperation. DEG's special contribution for this transaction lies in trainings for smallholder farmers as part of the DeveloPPP programme. IFC and DEG have been financing partners for 30 years."
Benson Adenuga, Head of Office and Coverage Director for Nigeria at British International Investment, said, "We are delighted to partner with IFC, other impact investors, and the development finance community on this project, which will boost fertilizer production in Nigeria, support food security and create jobs. Our ongoing commitment to back Indorama's expansion will also help to elevate Nigeria's export potential and support the diversification of its economy."
Ousmane Fall, Ag. Director, Industrial and Trade Development Department at the African Development Bank (AfDB), said "The AfDB is proud of its continued partnership with Indorama, the IFC and other lenders on this critical project as it is aligned with our strategic priorities to Feed Africa and Industrialize Africa while generating significant development outcomes in Nigeria."
Freddy Ong, Head of Client Coverage, Singapore, Corporate, Commercial and Institutional Banking at Standard Chartered Bank, said, "We are pleased to participate in this transaction, one of the many we have been a part of during our long-standing relationship with Indorama since 1997. We have been proud partners to Indorama across Standard Chartered's footprint markets and especially at Indorama Eleme Fertilizer and Chemicals Limited, where we have remained engaged since its inception. With this latest financing, we look forward to the successful completion of Indorama Eleme Fertilizer and Chemicals' facility and the expansion of its urea fertilizer capacity that will help address global food security and strengthen its position as a leading supplier of essential materials in the global food ecosystem."
The investment in Indorama Eleme Fertilizer and Chemicals Limited is part of IFC's strategy to promote diversified, inclusive growth and job creation in Nigeria, where IFC supports the manufacturing, agribusiness, healthcare, infrastructure, technology, and financial services sectors.
About IFC
IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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