Petroleum Development Oman (PDO) has confirmed it is in the market for a USD3.4bn loan with HSBC acting as the sole international financial adviser. The five-year pre-export finance facility was initially launched with 10 international banks but due to strong interest, the borrower is now considering extending the syndicate. According to one banker close to the deal, over twenty banks have been approached in general syndication, and PDO -- which is majority owned by Oman but with stakes held by Royal Dutch Shell, Total and Partex Oil and Gas -- is expected to be able to raise a further USD1bn. The financing follows a USD1bn five-year loan for the Sultanate of Oman that closed in January, but only after a protracted syndication. That deal faced difficulty after Standard & Poor's downgraded the country's sovereign debt to BBB+ during syndication in November, which led to pricing on the loan being flexed upwards from 110bp over Libor to 120bp over Libor. With that in mind, lenders wanted the extra security offered by the pre-export financing structure on PDO's new deal, rather than pure Omani sovereign risk, bankers said. (Reuters)