Acwa Power, a leading Saudi developer, investor, and operator of power generation, water desalination and green hydrogen plants worldwide, has announced that its joint venture entity has closed a financing agreement worth $8.5 billion for a major green hydrogen project coming up at Saudi futuristic city Neom.
In addition to Acwa, Neom Green Hydrogen Company (NGHC) has US-based Air Products, a world leader in industrial gases, and developer of mega Saudi futuristic Neom as its JV partners.
The finance for the project will come from a combination of long-term debt and equity, stated Acwa Power in its filing to Saudi bourse Tadawul.
The total financing consists of $5.85 billion senior debt and $475 million of mezzanine debt facilities, both arranged on a non-recourse project finance basis. It includes:
*$1.5 billion from National Development Fund (NDF) on behalf of National Infrastructure Fund (NIF), under foundation.
*$1.25 billion is in the form of Saudi riyal denominated financing from Saudi Industrial Development Fund (SIDF).
The balance will come from a consortium of financiers, structured as a combination of long term uncovered tranches and a Euler Hermes covered tranche, stated Acwa Power in the bourse filing.
These include First Abu Dhabi Bank, HSBC, Standard Chartered Bank, Mitsubishi UFJ Financial Group, BNP Paribas, Abu Dhabi Commercial Bank, Natixis, Saudi British Bank, Sumitomo Mitsui Banking Corporation, Saudi National Bank, KFW, Riyad Bank, Norinchukin Bank, Mizuho Bank, Banque Saudi Fransi, Alinma Bank, Apicorp, JP Morgan, DZ Bank, Korea Development Bank and Credit Agricole.
According to Acwa Power, the project scope includes the development, financing, design, engineering, procurement, manufacturing, factory testing, transportation, construction, erection, installation, commissioning, insurance, ownership, operation and maintenance of the world-scale green hydrogen and green ammonia facility in Neom.
Also a 30-year green ammonia offtake contract has been inked with Air Products, it added.