Acwa Power consortium reaches financial close for $1.6bn red sea utilities project

24 Feb 2022
Acwa Power consortium reaches financial close for $1.6bn red sea utilities project

A consortium led by the local Acwa Power has reached financial close for the $1.6bn Red Sea multi-utilities project in Saudi Arabia

A consortium led by the local Acwa Power has reached financial close for the $1.6bn Red Sea multi-utilities project in Saudi Arabia.

Acwa Power, in consortium with China’s SPIC Huanghe Hydropower Development Company and Saudi Tabreed Cooling Company, reached financial close for the $1.302bn senior debt facilities for the project, which the consortium will develop under a build, operate and transfer (BOT) model.

The project will be entirely powered by renewable energy.

The financial close was arranged as anon-recourse project finance, with financing secured from Al-Rahji Banking and Investment Corporation, Banque Saudi Fransi, Saudi British Bank, Arab Petroleum Investment Corporation (Apicorp), Standard Chartered Bank and Riyad Bank.

 Energy & Utilities reported in November 2020 that the Acwa Power consortium had been awarded the public-private partnership (PPP) contract by the Red Sea Tourism Development Company (TRSDC) to develop the utilities and related infrastructure for the Red Sea Tourism project in the Saudi Arabia.

Energy & Utilities had previously reported that the Acwa Power consortium, which also includes SPIC Huanghe Hydropower Development Company and Saudi Tabreed District Cooling Company, had been selected as preferred bidder for the planned PPP project.

The PPP contract will include the provision of power and water production, sewage treatment and solid waste treatment. The Red Sea Development Company is owned by sovereign wealth vehicle Public Investment Fund (PIF), and the PIF will provide the guarantee for the 25-year offtake agreement.

Power is planned to be generated for the Red Sea Utilities project from 400MW photovoltaic (PV) solar and wind energy, with 1.3GWh of battery storage included.

The 1.3GWh is expected to allow the resort to remain completely off-grid and powered by renewables day and night.

Energy & Utilities reported in October 2021 that China’s Huawei Digital Power had been awarded a contract for the battery energy storage solution (BESS) for the Red Sea utilities project.

Huawei Digital Power signed the contract with China’s Sepco 3, which is the EPC contractor, for the 400MW of photovoltaic (PV) solar and 1,300MWh BESS, which will be the largest BESS in the world.

For water production, two seawater reverse osmosis (SWRO) plants will be developed with a capacity of 30,000 cubic metres a day (cm/d) under the first phase. The demand will be split between potable water, 21,000 cm/d, and irrigation top-up, 9,000 cm/d.

Under the second phase, an additional SWRO plant will be developed in addition to brine squeezer and chlor-alkali technologies to meet expected demand of up to 50,000 cm/d, split 39,000cm/d and 11,000cm/d between potable water and irrigation top-up respectively.

The selected developer will also be required to provide a sewage treatment plant (STP) with a capacity to treat up to 18,000 cm/d of sewage under the first phase of the project through a constructed wetlands scheme. The peak sewage flow of the development is expected to reach 34,000 cm/d by 2030.

For the waste treatment development, the PPP contract will cover collection, automatic recovery and waste-to-energy production for up to 30 tonnes per day (t/d) under the first day. This will rise to 55 t/d by 2030,

TRSDC was established in line with the kingdom’s Vision 2030 economic reform plan to diversify the country’s economy and increase the kingdom’s tourism sector.

Under the first phase development, TRSDC is planning to develop five islands, two inland sites and deliver 3,000 hotel keys to accommodate 300,000 visitors a year by 2022. By 2030, the client hopes to have developed 22 islands, six inland sites and have delivered 8,000 hotel rooms to service up to 1 million visitors a year.

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