ACWA Power has reached financial close on the 1500MW Sudair solar plant in Saudi Arabia.
The project is supported under the Public Investment Fund (PIF) renewable energy programme.
A specialised Saudi technical team at the Ministry of Energy selected the Sudair project site and carried out the engineering requirements and preliminary studies of the project.
The ministry is using its renewable energy programme and local content development program to support the supply chain through various initiatives such as mobilising private sector investments and encouraging partnerships between the public and private sectors to create a competitive national market for renewable energy.
ACWA Power also announced that SAPCO, a fully owned company of Aramco, has joined the consortium with ACWA Power and Badeel, a company fully owned by PIF.
The PIF’s renewable energy programme aims to support Saudi Arabia’s ongoing energy transition and diversification, and to deliver 70% of the country’s renewable energy under the National Renewable Energy Program (NREP).
ACWA Power, in which PIF holds a 50% stake, and Badeel will each own 35% in the special purpose vehicle Sudair One Renewable Energy Company, which was incorporated for the project.
SAPCO holds a 30% stake.
Aramco’s investment in the Sudair Project is its first participation with PIF in its renewable energy program; reflecting the company’s efforts to advancing sustainable energy solutions within its operations and Saudi Arabia, where a variety of low-carbon energy solutions are being deployed.
The financing for the project is based on the principles of limited recourse project financing, with the senior debt structured as a soft mini perm facility with a tenor of 28 years and both conventional as well as Islamic tranches.
The financing structure also features a set of equity bridge facilities provided by local and international banks supporting the sponsor group’s equity investment in the project.
The financing group includes Mizuho Bank, Riyad Bank, Korea Development Bank, Arab Petroleum Investments Corporation (APICORP) and Al Rajhi Banking & Investment Corporation.
Mohammad Abunayyan, ACWA Power chairman, said: “Underpinned by our ambition and determination to continue driving the transformation of the Kingdom’s energy sector, I would like to extend my sincere gratitude and pride following the signing of agreements for the first project under the PIF renewable energy programme.”