Societe Generale provided first green loan to Russian mining sector
- 02 November
Societe Generale, an international financial group, provided USD 125 million loan to the gold mining company Polymetal to finance projects related to the transition to a sustainable and low- emissions economy. This is the first green loan in the Russian mining sector.
Societe Generale will provide a 6-year loan with a 3-year grace period under the Green Financing Policy of Polymetal. The loan can be extended to 7 years on the first anniversary of signing.
“Societe Generale is pleased to accompany Polymetal one more time in breaking new grounds in the integration of its ESG commitments into its financial strategy by structuring the Company’s first green loan in line with its recently adopted Green Financing Framework. This is a very innovative transaction in mining which was made possible by embedding the Company’s ESG principles into investment decisions. Societe Generale is delighted to support Polymetal’s continuous progress towards achieving a low-emissions future and more efficient use of resources”, said Stephanie Clement de Givry, Global Head of Mining, Metals and Industries Finance.
“We are honored to continue to support Polymetal in developing its environmental, social and corporate governance programs. This green loan, which complies with the Green Finance Policy, is an important milestone for the bank and to the company. It demonstrates our willingness to implement such ambitious initiatives of our client, providing high-quality expertise of Societe Generale,” commented Patricia Isaeva, First vice-president of Rosbank, managing director of Global Banking and Advisory Russia.
“We want our business model to be sustainable and we are actively investing in energy efficient technologies and responsible waste and water management. With the first green loan, we invite lenders to contribute to our ESG goals and we provide comfort to stakeholders that our green projects and strategy are aligned with the global Sustainable Development Goals”, said Eugenia Onuschenko, Corporate Finance Director of Polymetal.
The loan proceeds will be allocated to projects among the following categories: clean transportation, renewable energy, energy efficiency and sustainable waste and water management projects, which contribute to Polymetal’s sustainability goals and actions against climate change.
Polymetal is responding to climate change and transition to circular economy by:
- cutting GHG intensity from its operations (by 5% by 2023 vs 2018);
- improving energy efficiency through innovation, including low-carbon and renewable energy technologies (7% share of renewable energy by 2025);
- switching to dry storage of tailings (15% share by 2024);
- reducing fresh water use for processing of tonne of ore (by 11% by 2023 vs 2018);
- annually recycling at least 16% of waste generated by 2023.
Polymetal intends to fully allocate the green loan proceeds towards the eligible green projects within 24 months from the first utilisation.
The Framework is in line with the LMA Green Loan Principles. CICERO Shades of Green has provided a Second Party Opinion and has attributed the Framework Medium Green shading (out of possible Brown, Light, Medium and Dark Green) and graded the governance procedures in relation to green financing as Good.
This is the third sustainability-linked loan in the Company’s credit portfolio with the share of ESG instruments now reaching 18% of net debt or USD 280 million in total.