Morocco’s national rail operator, Office National des Chemins de Fer (ONCF), has raised 2bn Moroccan dirhams ($about $200m) through a green bond aimed at funding rail projects and cutting transport emissions.
The issue was heavily oversubscribed, with investors offering 9.65bn dirhams, nearly five times the amount sought.
The bonds were issued with a 30-year maturity and a fixed interest rate of 4.37%, according to the company. Investors did not take up the alternative tranche offering a revisable rate.
The operation is guaranteed by the Moroccan state through Tamwilcom and was structured with CDG Capital.
Institutional investors drove most of the demand. Pension funds and insurance companies together sought more than 5.3bn dirhams, attracted by the long maturity and stable return.
For ONCF, the 30-year bond provides long-term funding for its rail expansion plans as Morocco develops its transport network ahead of major infrastructure projects later in the decade.
The proceeds will finance rail infrastructure and energy projects as part of Morocco’s strategy to cut emissions in the transport sector.
ONCF says 90% of its electric trains, including the high-speed service Al Boraq high-speed rail, already run on renewable energy.
The company aims to use the new funding to expand rail lines, including future high-speed extensions toward Marrakech and further south, while reducing carbon emissions.
According to ONCF, the projects supported by the bond could help avoid around 120,000 tonnes of carbon dioxide each year.
Morocco is also seeking to increase the share of renewable electricity used by its rail network, with a target of 100% clean energy for train traction by 2035.
