BankMuscat has agreed on a US$166.5 mln loan facility for Octal's APET sheet packaging plant. This completes the initial phase of financing for the venture in Salalah Free Zone, which aims to capture a 20% share of the global market for APET. The facility is made up of a US$148.5 mln term loan, of which US$34.5 mln has been syndicated to Bank Dhofar, and US$18 mln in working capital. Financing was raised in three stages over the last year and completes Octal's initial US$300 mln investment in proprietary technology and custom-made production lines.
Octal Petrochemicals expects sales of its APET (amorphous polyethylene terephthalate) sheet packaging to reach US$500 mln pa by the end of next year. Production capacity now stands at 30,000 metric tpa, but is estimated to cross 300,000 tpa by June 2008 as Octal estimates to capture 20% of the world market for APET sheet, which was valued at US$2.25 bln last year. The North American market is the prime target for Octal. Oman's total non-oil exports to the US were RO15.6 million in 2006, and Octal alone aims to increase that figure five-fold by the end of next year.