DUBAI: Saudi Aramco is talking to banks about raising a $5 billion loan related to a refinery it built in collaboration with China’s Sinopec, three sources with knowledge of the matter said.

The funds raised from banks will be used to replace some of the capital Aramco invested to build the 400,000 barrel per day (bpd) refinery at Yanbu, which can then be deployed in other projects.

Aramco did not immediately respond to a request for comment.

According to the invitation sent to a group of local and international lenders, Saudi Aramco wants to borrow the $5 billion for ten years, according to one of the sources.

The source, an infrastructure banker, added Aramco had asked for the loan pricing, inclusive of margin and fees, to be “double digits in all,” a level which the source described as extremely aggressive.

The fact Aramco is seeking funds now — almost nine months after the refinery shipped its first products, as opposed to when the initial agreement was struck to build the refinery in January 2012 — should mean it gets cheaper pricing, the second source said.

This is because the refinery has some financial track record which banks can base a lending decision against and the risk around construction and getting the project off the ground has dissipated, he said.

It is the second time this year that Aramco has sought a major financing from banks: in March, it signed a $10 billion loan with 27 financial institutions which would refinance an existing $4 billion facility at better terms.

The refinery is run by Yanbu Aramco Sinopec Refining Co. (Yasref), with its ownership split 62.5/37.5 percent between Aramco and Sinopec, and its products include 263,000 bpd of diesel and 90,000 bpd of gasoline, according to its website.