2023-08-08 06:57:15
The Development Bank of Latin America and the Caribbean (CAF) announced that it “contributes to the just energy transition towards less polluting fuels in Argentina through a loan to YPF for US$ 375 million.
The funds will be used to finance improvements in the Company’s industrial complexes in La Plata and Luján de Cuyo, “which will increase the production of ultra-low sulfur fuel (both gasoline and diesel). The initiative will also expand YPF’s refining capacity, promote technological change towards less polluting engines, and generate more than 1,600 jobs during the construction period,” the regional credit agency described.
CAF then announced the disbursement of an A/B loan to YPF SA in order to finance the Company’s “New Fuel Specifications” (NEC) project.
The financing will consist of a Tranche A of US$ 50 million and a Tranche B of US$ 325 million, mobilizing private capital from six international financial entities. The institutions are Banco Santander SA; the Industrial and Commercial Bank of China Limited, Panama Branch; Cargill Financial Services International, Inc.; Citigroup Inc.; Bank of China Limited, Grand Cayman Branch; and Latin American Bank of Foreign Trade SA.
YPF’s investment plan, deployed in the La Plata (Buenos Aires province) and Luján de Cuyo (Mendoza) refinery complexes, contemplates the construction of new units and the readjustment of existing facilities that will allow the production of 3.5 million cubic meters of ultra low sulfur fuels. These works were already started by YPF in 2019 and will continue to be developed over the next two years.
As a result of the NEC project, YPF will go from producing 24 percent of the total ultra-low sulfur fuels currently to 71 percent by 2026. This will make it possible to generate less sulfur dioxide emissions, which will result in a consequent improvement in the atmospheric quality. In addition, the initiative will expand the company’s refining capacity, promote technological change in the automotive sector towards less polluting engines and will generate, during the construction period, 1,600 direct jobs and 3,200 indirect ones.
“With this operation, CAF collaborates with three aspects of the country. It contributes to the environment -through the production of less polluting fuels-, strengthens energy security -through the expansion and technological improvement of YPF’s industrial complexes- and allows the mobilization of external financing sources”, it was highlighted.
Sergio Díaz-Granados, Executive President of CAF, stated that “ultimately, the initiative is a clear example of our just energy transition agenda that seeks to contribute to the Sustainable Development objectives.”
YPF has been a CAF client since the beginning of the institution’s activity in Argentina, with an excellent history of joint operations. Since 2009, 4 A/B loans and one corporate loan have been approved for a total value of US$ 1,225 million.
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