Acwa Power said its consortium with Gulf Investment Corporation (GIC) and Alternative Energy Projects Company (AEPC) has achieved financial closure for the Ibri-2 solar project in Oman. The 500MW, $400m independent power project (IPP) is being developed on a build, own, operate (BOO) basis and will become Oman’s largest utility-scale solar PV project. It will be funded on a debt to equity ratio of 70:30.
As per the agreement, a group of six international and local lenders will provide $275m senior debt to the consortium. The main banks are said to include the Asian Infrastructure Investment Bank (AIIB), Bank Muscat, Riyad Bank, Siemens Bank, Standard Chartered Bank and Warba Bank. They are said to have helped structure the largest utility scale solar PV project in Oman on a 16.5-year door-to-door tenor.
The deal also represents the first renewable energy financing in Oman as well as the GCC region by AIIB, the Beijing-headquartered international multilateral development bank, the statement said.
“We are pleased to partner with GIC and AEPC on the largest utility scale solar IPP in Oman. This milestone further asserts our commitment to provide low cost and sustainable electricity supply solutions to our esteemed clients like the Oman Power & Water Procurement Company. Successfully achieving financial closure during these challenging times is a testament to the determination of all the stake holders in this project to keep doing the best we can within the constraints we all need to work within,” says Acwa Power CEO Paddy Padmanathan.
Acwa Power CIO Rajit Nanda adds, “We are pleased to achieve a successful closing of yet another financing in Oman, which is a key country for Acwa Power’s operations in Middle East. Achievement of this milestone together with our partners – co-shareholders, contractors and the bank group comprising of international and local banks – notwithstanding the trying financial and macroeconomic challenges prevalent the world over resulting from the Covid-19 outbreak demonstrates our structuring capabilities, the resilience of our long lasting partnerships and our commitment to OPWP.”
He elaborates, “The project which is the largest utility scale Solar PV project in Oman, will also be the first renewable energy financing for AIIB in the GCC region, paving the way for a stronger partnership with the Beijing based international multilateral bank in the future.”
At peak generation capacity, the plant output will be enough to supply an estimated 33,000 homes with electricity and will offset 340,000 tonnes of carbon dioxide emissions a year, said the statement from Acwa Power.
