The Volgafert urea fertilizer plant in Russia – a joint venture between Russian chemical producer KuibyshevAzot (KuAzot) and Italian Maire Tecnimont Group (MET) – reached financial close on an 11-year €173 million ($189 million) limited recourse SACE-covered project financing in mid-December 2019. The deal marks the first international ECA-backed financing for KuAzot. It was the first cooperation between KuAzot and MET and in particular the first time in Russia that MET acted not only as EPC contractor, but also as co-developer and minority shareholder in a world-scale chemical project.

MET – via its subsidiary MET DEV1 srl, an investment vehicle comprising Maire Tecnimont and SIMEST (Cassa depositi e prestiti Group), a company controlled by SACE that helps Italian companies expand internationally through soft loans, export credit support and capital investment – was awarded the EPC contract in December 2018.

The project, one of the main industrial premises of KuAzot in Togliatti, has a capacity of 1,500 tons per day and will produce and commercialise high-quality urea granules both for domestic and export markets. It envisages the use of advanced process technologies (Stamicarbon Pool Reactor technology) that ensure environmentally friendly and safe production, as well as the resource consumption at par with global peers. Project completion is scheduled for 2021-2022.

The financing was provided by ING Wholesale Banking (ING) and UniCredit Bank AG (UCB). ING took on the leading role, acting as mandated lead arranger, global coordinator, documentation gent and due diligence coordinating bank for six external advisors. UCB acted as mandated lead arranger, facility agent, security agent and SACE agent (through UniCredit, Italy). The project financing and Interest Rate Swap (IRS) are shared 50/50 between ING and UniCredit.

Cristina Morelli, head of SACE’s export finance department: “This transaction was a unique opportunity for supporting different business lines of Maire Tecnimont Group together with the Italian technological supply chain involved in the project that took in around 40 Italian companies. Also, this specific transaction tested our ability to adapt our experience to new export schemes, allowing us to further expand our clients’ portfolio in the region. Once again, Russia and the petrochemical industry continue to be key markets for SACE’s project finance transactions”.
Daniela Mohtadi, team head of structured export finance at ING tells TXF: “The unique element in the financing of this transaction is that it is a relatively small ECA covered project finance transaction, which came together as a result of a solid underlying project, the commitment of the sponsors to the project, as well as the commitment of SACE and the MLAs to both the project and the region. It has been a very positive experience to be able to contribute to the further development of KuAzot and the realisation of the business development plans of MET.”  

Pierroberto Folgiero, chief executive officer at Maire Tecnimont Group, comments that: “This transaction is a significant step forward in our project development strategy which confirms the reliable value proposition of an integrated Technology and EPC company as Maire Tecnimont. We are very keen to strategically cooperate with a prestigious industry leader such as KuibyshevAzot in one of our core business areas, Fertilizers.”

Gerasimenko Aleksandr, general director of PJSC KuibyshevAzot: “The new urea project in collaboration with one of the world leaders - the Maire Tecnimont Group, under the support of ECA covered financing, organized and provided by ING Bank and Unicredit Bank AG will allow us to further grow our business through constant technological development and improvement in operational performance, being strategically focused on generating leading positions in fast-growing markets”.
Eriks Atvars, UniCredit’s global head of natural resources, comments: “We are delighted to support Maire Tecnimont and KuibyshevAzot in their milestone JV. The Volgafert project demonstrates the successful joining of forces between leading Russian fertilizers and chemicals producer KuAz, and Maire Tecnimont, one of the world’s largest engineering firms in the hydrocarbons sector. This particular transaction saw Maire Tecnimont act not only as EPC Contractor and technology provider, but also taking a role in project development and equity investment.”

About sponsors and EPC 

PJSC KuibyshevAzot is one of the leading Russian chemical producers located mainly in Togliatti, with additional divisions located in various regions of the Russian Federation, as well as Germany, China and Serbia. The company's operations are organized into two principal business segments: (i) caprolactam and its derivatives (polyamide-6, PA industrial and textile yarns, cord fabrics, engineering plastics); and (ii) ammonia and nitrogen fertilizers (ammonium nitrate, urea, UAN solution, ammonium sulphate). Kuibyshevazot with over EUR 0.7 bln annual turnover is one of the top 10 Russian nitrogen fertilizer producers and Russia's leading caprolactam manufacturer. It is a privately owned company who has set up several JVs on its industrial site with big international players, incl. Linde, Germany (JV for ammonia production) and Praxair, USA (JV for air-separation unit). A key factor in its growth has been the ongoing modernization and expansion programs, financed mainly by long-term debt and internally generated cash.

MET DEV1 srl is a company belonging to Maire Tecnimont Group and participated by Simest (part of CDP Group supporting foreign investments of Italian companies). It has been created to co-develop projects for companies active in the petrochemical / fertilizer sector.

Maire Tecnimont, a company listed on the Milan Stock Exchange, leading an international industrial group which is a leader in the transformation of natural resources (plant engineering in downstream oil & gas, with technological and execution competences). Through its subsidiary NextChem it operates in the field of green chemistry and the technologies to support the energy transition. Maire Tecnimont Group operates in about 45 countries, through 50 operative companies and a workforce of approximately 6,300 employees, along with approximately 3,000 professionals in the electro-instrumental division. For more information: