US sponsors seek loan for Mexican midstream project

29 March 2019 - 12:00 am UTC

The SPV behind the USD 240m Tuxpan International Fluids Terminal (TIFT) project in Mexico is in talks with lenders to raise debt for approximately USD 150m to fund construction, said a source close to the situation.

The SPV comprises KKR-backed company Monterra Energy and a subsidiary of US based SSA Marine called Tuxpan Port Terminal. The sponsors had sent in February a request for proposals to potential lenders to draw appetite to a 10-year credit facility.

The sponsors are planning to contribute USD 90m as equity investment in the project.

The SPV has already agreed to contracts with French multinational Total and Madrid-headquartered Repsol, which will be anchored clients for the project.

Repsol’s agreement consists in securing 450,000 barrels of storage capacity in the project, according to its legal advisor Mayer Brown.

The sponsor is understood to be selecting potential arrangers to structure the transaction, with an official mandate yet to be signed.

The project is a storage facility for refined fuels to be located in Tuxpan, in the State of Veracruz, with an expected capacity to store 2m barrels. It is slated to begin operations in 2020.

SSA Marine is a subsidiary of US based company Carrix. As reported Blackstone Infrastructure Partners recently made an investment in the marine port terminal operator last month.

Monterra Energy was founded and led by Mexican entrepreneur Arturo Vivar, and in May 2015 entered into a joint venture agreement with global investment firm KKR to develop projects in Mexico’s midstream sector.

Monterra Energy declined comment. SSA Marine did not return calls seeking comment.

 

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