Bahrain's nogaholding set to name financial adviser

PHOTO

MANAMA: Bahrain’s nogaholding is in final talks to appoint a strategy consultant and financial adviser, its chief executive said yesterday.

Nogaholding issued a request for proposal (RFP) for an independent financial adviser last week and expects to award it in roughly eight weeks’ time, group chief executive Mark Thomas told Reuters.

The aim is to develop an energy strategy within six months and an asset monetisation programme as soon as next year, he said.

“The independent financial adviser will be looking at asset monetisation, our debt and our structure of our debt, looking at opportunities where we can use alternative forms of financing like sustainability-linked loans,” Mr Thomas said.

The adviser will also help nogaholding with a possible national hedging strategy, in co-ordination with the finance ministry, to protect on the downside and unlock any upside, he added.

“We’ve got very attractive oil prices right now. We generally run a budget, a national budget, at an oil figure of $60-$65” per barrel to break even, he said. International oil prices are above $110 a barrel.

Monetisation

The strategy consultant, for which an RFP was issued in December, is expected to complete early in the fourth quarter a national energy strategy, a nogaholding operating strategy and a carbon strategy aligned with Bahrain’s goal of net zero emissions by 2060.

Nogaholding will follow a monetisation model similar to Saudi Aramco and Abu Dhabi National Oil Company (ADNOC), Mr Thomas said.

That included lease and leaseback agreements and initial public offerings of subsidiaries. Bahrain could list one or more of its operating companies, which include Bapco, he added.

A previously issued RFP to monetise a pipeline between Saudi Arabia and Bahrain was abandoned as debt tied to the deal would have likely impacted nogaholding’s rating, the nogaholding CEO said.

“When we look at the relevant debt that we take on, it doesn’t help our balance sheet at all. It is instant cash, but we don’t really need the cash right now,” he said.

Nogaholding wants to reduce its debt, Mr Thomas said, although it may raise more should new projects require it. It may also refinance existing debt.

Bahrain could also consider increasing oil production if it made sense economically, he added.