ACWA Power consortium signs $650 mln financing agreements for Saudi desalination plant

Utilities provider ACWA Power successfully signed senior financing agreements for the $650 million (SAR 2.43 billion) Jubail-3A IWP.

The project is the fourth seawater reverse osmosis (SWRO) desalination project to be awarded in Saudi Arabia over the last three years, as part of the largest public-private partnership (PPP) desalinated water procurement program in the world.

"Signing of the financing agreements for the Jubail-3A IWP project in less than four months from the date of signing the water purchase agreement, especially in the midst of a pandemic, is testament to the financial community’s confidence in ACWA Power’s proven capabilities,” Paddy Padmanathan, President and CEO of ACWA Power, said.

The utility-scale project had been awarded to the consortium led by ACWA Power, in association with Gulf Investment Company (GIC) and Al Bawani Water and Power Company (AWP), earlier this year at a tariff of 41 cents per cubic meters for desalinated potable water.

The water purchase agreement was signed on May 21, 2020 by Saudi Water Partnership Company (SWPC) in its capacity as the off taker of the project.

The transaction is financed through limited recourse ring-fenced project financing with Al Rajhi Bank, Abu Dhabi Islamic Bank (ADIB), Riyad Bank and Mizuho Bank being the initial mandated lead arrangers.

In addition, Riyad Bank and Bank AlJazira have already provided equity bridge loans for the transaction earlier this month.

The commercial operation date of the plant is scheduled towards the end of calendar year 2022.