The Shariah-compliant financing facility includes $0.5m granted as a six-year musharaka facility to finance repairs and maintenance; a $3.2m short- and long-term murabaha facility to finance working capital for seeds, fertilizers and chemicals; and a $1.2m five-year mukawala facility to finance consulting contracts as well as some infrastructure works.
Sabina is located on the western bank of the White Nile River south of Khartoum and just south of Kosti township, a major logistics hub in White Nile State. Sabina controls approximately 250,000 feddans on a 30-year renewable basis.
“By granting this facility, the Bank of Khartoum has recognized the very clear and compelling economics of Sabina,” said Sabina Managing Director John Elgin. “We have not only leased our land for a very favorable price, but easily have sufficient water available. We look forward to delivering outstanding gross margins selling on the local Sudanese market, where prices are approximately double international norms.”
Sabina will bring 5,500 feddans per year into production for the next two years and 11,000 feddans per year thereafter for a total cultivated area of 125,000 feddans. Crops will initially include sorghum, maize, cotton, legumes and sugarcane, with the project likely to help fill the 600,000 metric ton per year shortfall in sugar supply in Sudan.
At the same time as it looks to increase production, Sabina is actively investing in local people and infrastructure, building and rehabilitating schools, health facilities and community centers, among other community infrastructure.
Also today, Wafra announced that it has cleared some 3,000 feddans of agricultural land at portfolio company Sudanese Egyptian Agricultural Crops Company (SEAC) in southern Sudan.
“Over the past 6 months we have recruited and developed a very competent and enthusiastic team of employees anxious to move forward with project development,” said SEAC Managing Director Peter Schuurs. “During this same period we have progressively assembled the complement of plant and equipment required to undertake the development work, and we are all looking forward to the commencement of the dry season later in 2010 when development activities will commence in earnest, aiming to sow our first commercial crop of maize in mid-2011.”
SEAC controls 250,000 feddans near the city of Bentiu in Unity State (Welayet Al-Wehda), approximately 600 kilometers north of Juba. The company aims to bring 10,000 to 15,000 feddans into production each year.
Wafra aims to have 11,000 feddans under cultivation at Sabina by the onset of the rainy season in 2011 and a further 10,000 at SEAC.
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