Acwa Power and Air Products reach financial close for $12bn Jizan gasification scheme
A consortium of the local Acwa Power and US-based Air Products has reached financial close for the acquisition of the first group of assets for the $12bn Jizan gasification combined-cycle (IGCC) project
A consortium of the local Acwa Power and US-based Air Products has reached financial close for the acquisition of the first group of assets for the $12bn Jizan gasification combined-cycle (IGCC) project.
The JV will complete the commissioning and testing and commence the operation and maintenance of the plant to supply power, steam, hydrogen and other utilities for Saudi Aramco’s Jizan refinery under a 25-year offtake contract with Aramco. Aramco will supply the feedstock for the plant’s operation.
Energy & Utilities reported in May this year that the operating joint venture had relaunched the $7.2bn senior debt required in the bank market, with sponsors seeking to raise $5.6bn with$1.6bn equivalent $ and SR tranche already committed from Saudi Industrial Development Fund (SIDF).
The senior debt facilities were secured from a mix of local, regional and international banks and financial institutions. In addition to the commitments from the Saudi Industrial Development Fund, some aspects of the limited recourse project financing involved the participation of a consortium of far-eastern non-bank financial institutions, commercial banks and Islamic banks.
Saudi Aramco, via its subsidiary Saudi Aramco Power Company, has a 20 per cent stake in the JV, with Air Products holding a 46 per cent stake, Acwa Power 25 per cent and Air Products Qudra holding the remaining 9 per cent.
Aramco’s Jizan refinery processes 400,000 barrels a day of crude oil to produce ultra-light sulfur diesel, gasoline and other products. The power plant will have a capacity of about 3,800MW.
Air Products and Acwa Power signed an agreement with Saudi Aramco in August 2018 to form a gasification and power joint venture (JV) for the Jizan IGCC project, which will located at Jizan Economic City in the southwest area of Saudi Arabia.
Aramco awarded China’s Sepco an engineering, procurement and construction (EPC) contract to build and commission the Jizan integrated gasification combined-cycle (IGCC) power plant contract in 2014. That year, the company also awarded Saipem a $1bn contract to provide gas turbines, generators and heat steam generators for the gasification plant.
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