Gunvor Group, one of the world’s largest independent traders of liquefied natural gas (LNG), has signed a new syndicated borrowing base facility worth $1.13 billion.
In what the company believes is a first-of-its-kind agreement, the LNG facility will include measurement commitments on Scope 1, 2, and 3 emissions, as per the Enterprise Carbon Accounting (ECA) taxonomy.
The syndication launched at $800 million and was oversubscribed following strong appetite from the market, predominantly in Asia, the Middle East, and Europe, and closed at $1.13 billion.
The facility, structured around global LNG trade flows, including Gunvor’s shipping activities, will finance physical and derivative positions.
As a part of the facility, Gunvor has committed to CO2 carbon emissions reporting to establish transparency for the carbon footprint of the company’s LNG value chain.
Tawfik Sadfi, head of structured trade finance at Gunvor Group, said: “The success of this new LNG borrowing base demonstrates a strong commitment from banks to support Gunvor’s growing LNG business through innovative structures.
“Gunvor’s clearly defined trading strategy and business model – which function hand-in-hand with our sustainability commitments – continue to attract the confidence of the market.”
A spokesperson of Rabobank, which will serve as security agency of the facility, said: “The successful syndication of this facility – which is a first of its kind for LNG trading, and coincided with unprecedented volatility in the market – reflects the strong interest of banks to support responsible participants in the growing global LNG market, one of the main enablers of the energy transition.”
Gunvor has previously announced commitments in environment, social, and governance (ESG) areas, targeting a 40% reduction in the company’s Scope 1 and 2 emissions by 2025.
For existing and new trading, Gunvor said it is launching dedicated programmes to reduce emissions and environmental impact, while taking into account human rights considerations, in line with its commitment to the United Nations Guiding Principles (UNGPs) on Business and Human Rights.
Gunvor said that tracking and reporting of Scope 1, 2, and 3 emissions related to LNG trading will add further to those commitments.
A spokesperson of Societe Generale, which will serve as the documentary agency of the facility, said: “We are proud to accompany Gunvor in this landmark transaction.
“This new LNG borrowing base embodies Gunvor’s long-term strategic move to support transitional commodities that enable the energy transition to a low-carbon future.”
The Active Bookrunners will also serve as a facility agent, and Natixis’ Singapore branch will serve as the mandated lead arranger.