Taqa consortium announces financial closure for $4bn Saudi power projects

04/09/2025 03:30 AST

Abu Dhabi National Energy Company (Taqa), together with Japan's largest power generation company Jera and AlBawani Capital (AlBawani), a subsidiary of leading Saudi contracting and development group AlBawani Holding, have announced the successful financial closing of two greenfield power plants in the Kingdom of Saudi Arabia.

The projects, Rihab ElAwal Power Company (Rumah 2) and Nawras Power Company (Al Nairyah 2), are being set up at a total investment of $4 billion.

Together, the greenfield combined cycle gas turbine (CCGT) power plants will deliver approximately 3.6 GW of power generation capacity. The projects are being developed on a build, own and operate basis and will support the Kingdom's growing energy need.

Financing was secured from a consortium of leading regional and international lenders through senior debt and equity bridge loans. Senior debt leverage exceeds 80%, reflecting the strong fundamentals of the projects and lender confidence.

These include Al Rajhi Bank, Riyad Bank, Saudi Awwal Bank, Saudi National Bank, Arab Petroleum Investments Corporation, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Bank of China and First Abu Dhabi Bank.

This milestone was achieved under the supervision of the Ministry of Energy, Saudi Arabia, in partnership with the Saudi Power Procurement Company (SPPC), following the signing of two 25-year Power Purchase Agreements (PPA) between Taqa, Jera and AlBawani.

Construction will be undertaken through a special purpose vehicle majority owned by Taqa with a 49% stake along with Jera (31%) and AlBawani (20%).

Operation and maintenance services will be provided by dedicated O&M companies owned by the consortium under the same shareholding structure.

Engineering, Procurement, and Construction (EPC) contracts were awarded to Harbin Electric International Company and China Tiesiju Civil Engineering Group Company.

Both plants will deploy highly efficient state-of-the-art, CCGT technology and are designed for future carbon capture integration, supporting the Ministry of Energy's decarbonisation goals set out in the Saudi Vision 2030.

These projects also align with the Saudi Green Initiative's ambition to achieve net-zero greenhouse gas (GHG) emissions through a circular carbon economy by 2060.

The Taqa consortium had selected Siemens Energy as the Original Equipment Manufacturer for the projects, with whom the O&M companies have entered into Long Term Service Agreements.

The projects support the Kingdom's optimum energy mix ambitions which aim to meet the growing power demand.

On the key achievement, Farid Al Awlaqi, Chief Executive Officer, Taqa's Generation business, said: "We are proud to have reached financial close, an important milestone in the progress of the projects that reinforces our position as a partner of choice for world-class utility projects."

"As lead developer of the power plants, we will be bringing our global expertise and experience to the project, in support of the Kingdom of Saudi Arabia's optimum energy mix ambitions," he stated.

"Notably, the construction of both plants is well underway with the early works phase concluding recently. We are developing the plants to be built for the future utilising the highest efficiency CCGT turbines, which demonstrates our firm commitment to growth and decarbonisation," he added.

Steven Winn, Chief Global Strategist, Jeraa, said: "Jera is pleased to achieve the financial closure of the plants as defined under their respective power purchase agreements and finance agreements with the senior lenders. It demonstrates our extensive capabilities and global development experience to successfully deliver projects of this complexity."

"The projects will strengthen Jera's presence and contribution to the kingdom in securing a reliable and sustainable energy supply. The projects shall have decarbonisation provision in line with Jera's goal of achieving net-zero by 2050. We congratulate all stakeholders on achieving this major milestone," stated Winn.

Eng. Fakher AlShawaf, Group CEO of AlBawani Holding, said: "Achieving financial close marks a significant milestone in AlBawani's ongoing commitment to supporting the kingdom's energy transition, in alignment with the ambitious oals of Vision 2030, and in partnership with Taqa and Jera."

"These strategic projects will deliver reliable, sustainable energy solutions and contribute meaningfully to Saudi Arabia's long-term growth and prosperity," he added.

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