EDO successfully reduces borrowing costs on its $2.5bln loan

EDO successfully reduces borrowing costs on its $2.5bln loan

Muscat – Energy Development Oman (EDO), a 100% government-owned entity, has successfully renegotiated the terms of its USD 2.5 billion loan, resulting in cost savings of USD 100 million in interest. The move sets a new benchmark for EDO and represents a significant saving for the company and the Sultanate of Oman. The exercise is part of a broader initiative aimed at reducing interest costs across government-related entities in Oman in line with the government’s objectives to achieve financial sustainability. The borrowing cost of EDO is largely based on the credit rating of the Sultanate of Oman. In 2022, the rise in oil and gas prices along with the government’s continued efforts to ensure financial sustainability led to two ratings agencies, Fitch Ratings and Standard and Poor’s (S&P), raising their rating assessments. This improvement in the credit outlook attracted more investors to the Sultanate. S&P Global Ratings has revised its outlook on Oman to positive from stable while affirming its ‘BB/B’ long- and short-term foreign and local currency sovereign credit ratings. According to the report, Oman’s government is repairing its balance sheet, with debt repayments and strong nominal GDP growth. Mazin bin Rashid Al Lamki, the CEO of EDO, commented