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Qurayyah IPP achieves financial close under the senior credit facilities

Saudi Arabia: Monday, April 30 - 2012 @ 11:56

The project, is being developed on a BOO (build, own, operate) basis, and is located at Qurayyah, on the eastern coast of Saudi Arabia adjacent to existing SEC facilities and will substantially increase power supplies to the Saudi power grid. It is the third of its type, and the largest IPP tendered by SEC represents another major development in the Saudi power sector to help meet the rapidly increasing power demand in Saudi Arabia.

Eng. Yousef AlOuhali, The Executive Managing Officer of the HAJR stated, from the company office in AlKhobar: “Qurayyah IPP is a Greenfield Independent Power Project with a net generation capacity of 3927 MW. The design production capacity will make it the largest IPP combine cycle gas-fired power plant in the world once completed.”

Qurayyah IPP comprises 6 identical groups of equipment, each delivering net output of 654.5 MW. Each group comprises 2 Gas Turbines (GTs), 2 Heat Recovery Steam Generators (HRSG) and 1 steam turbine. The Qurayyah IPP Plant is designed and will be constructed to comply with all applicable environmental laws, guidelines, regulations and standards as per World Bank, IFC and Saudi Presidency of Meteorology and Environment (PME).

The project will deliver 3927 MW of electricity to SEC under a 20 year Power Purchase Agreement (PPA) commencing on 30 June 2014. Siemens will provide all major equipment and electrical systems and Samsung C&T will engineer, procure and construct the project as the EPC contractor to deliver the project. Once completed, the plant will be operated by The First National Operation & Maintenance Company (NOMAC) a subsidiary of ACWA Power under a long-term Operation & Maintenance contract with Siemens providing parts and services for the gas turbines under a Long-Term Service Agreement (LTSA) with NOMAC.

The total cost of the project is $2.72bn (SR10.2bn), funded 75% by debt, which will be equally split between USD and SAR facilities. The USD facilities will include tranches funded or covered by three export credit agencies; US ExIm, KfW of Germany under a Eulerhermes cover and Kexim of South Korea. The international bank group providing funds are HSBC, Standard Chartered and SMBC. The local bank group is Banque Saudi Fransi, National Commercial Bank, Samba, Arab National Bank, Saudi British Bank and Saudi Hollandi Bank.

Paddy Padmanathan, President & CEO of ACWA Power which was the lead developer of the bidder consortium stated, “We are proud to be the Project Owner of Qurayyah IPP not only because it is the world’s largest combined cycle IPP, but most importantly the project will provide major economic advantage for the Kingdom of Saudi Arabia. First: ACWA Power was able to establish a team of developers, equipment supplier, EPC Contractor, O&M Contractor and debt facility providers who, working together were able to achieve a 15.5% lower tariff than those of the competing bidders, thus delivering more than SR2bn of savings over 20 years to the economy and the people of the Kingdom. With the doubling of the capacity, such difference increased to 21% and with the financial close under the senior credit facilities, the gap increased 5% further, thus increasing the savings even more.”

“Second: the project is designed with the highest thermal performance possible, more than 52% efficiency, or 14% more efficient than the traditional steam power plant exist in the Kingdome now which make it the most efficient in Saudi Arabia. This high efficiency will save the Kingdom more than SR2m/day in fuel cost, using the present world natural gas price. Third: this high efficiency will also save the Kingdom’s natural resources, as the project will save more than 160 million cubic feet of natural gas per day of equivalent MW production,” he added.

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Monday, April 30- 2012 @ 11:56 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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