The Al Dur project is a greenfield 1,234 MW combined cycle power plant, which is being financed by 75% debt and 25% equity. The total value of the project is $2.2bn, and its financing is a significant accomplishment considering the current state of the global economy. Work began on the Al Dur power plant at the end of August 2008, and is presently on target with regards to completion dates with full capacity due to be achieved in the summer of 2011.
Mr. Khalid Alshakrani, co-Managing Director, commented:
“Instrata Capital remains active despite the recent economic turmoil, and in addition to the Al Dur deal, we are currently looking at a strong planned investment pipeline, not only in KSA and across the GCC, but also in Morocco, Jordan, Egypt, and Tunisia. The countries of Saudi Arabia, Kuwait, Qatar and UAE are allowing private investors to not only benefit from positive returns, but also to make a sustainable investment contributing to the region’s development through mega projects such as the Riyadh PP11 independent power project in KSA and the Taweelah C independent water and power project in Abu Dhabi.”
Mr. Simon Monk, co-Managing Director, commented: “Water and power, gas, transportation and social infrastructure are the key areas of focus for Instrata Capital’s investments. The extensive feasibility research we conducted prior to the offering of the Bunyah fund showed that the Middle East has had the highest population growth rates in the world over the last two decades, and with this growth comes a demand for increased infrastructure. In particular, power and water shortage is a serious and growing issue, with the Middle East in possession of just 1% of the world’s renewable fresh water supplies and often suffering power cuts during high demand periods. Instrata Capital is well positioned to capitalise on this situation by investing in the emerging private infrastructure sector.
The Ministry of Finance – Bahrain, following an international competitive tendering process awarded the Al Dur project to GDF SUEZ and Gulf Investment Corporation (GIC), last year. The project is expected to deliver water and electricity to the Electricity and Water Authority (EWA), under a 25 year power and water purchase agreement. Construction started in September 2008 and the first phase of the project will begin operations in the summer of 2010, with full capacity being achieved in summer 2011. The project consists of a Combined Cycle Gas Turbine power plant and a Reverse Osmosis (RO) technology desalination plant.
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