Marafiq and its Partners, Veolia and Amwal AlKhaleejiah, Reach the Financial Closing of Jeddah Sewage Treatment Plant
SWPC and the consortium composed by Marafiq, Veolia, and Amwal AlKhaleejiah have successfully achieved the financial closing of the US$ 280M ISTP (Independent Sewage Treatment Plant) project for Jeddah.
JUBAIL, KINGDOM OF SAUDI ARABIA, 13th SEPTEMBER: Marafiq (Power and Water Utility Company for Jubail and Yanbu) is the lead developer in Jeddah Airport 2 ISTP (Independent Sewage Treatment Plant) and has a wealth of experience as an integrated utility service provider to major industrial cities in Saudi Arabia.
The Jeddah Airport 2 ISTP was awarded under the Build, Own, Operate and Transfer (BOOT) concession model, and will be developed under a 25-year Public-Private Partnership (PPP) model. Marafiq has partnered with Veolia, an Amwal AlKhaleejiah, who will support the development, financing, engineering, procurement, construction, implementation, ownership, operation, maintenance, and transfer of the Jeddah Airport 2 ISTP (Independent Sewage Treatment Plant).
Despite the COVID-19 pandemic consortium’s teams have issued a notice to proceed with the EPC contractor as per the agreement with SWPC. Stage one will treat 300,000 m3 per day, scheduled to be commissioned on January 31, 2023. Stage two might add another 200,000 m3 per day when the new STP capacity exceeds specific utilization rates.
The US$ 280M total project costs have been structured as non-recourse project finance, with funding sourced from a combination of senior project finance loans by the National Commercial Bank (NCB) and equity contributions from shareholders. During these unprecedented times, SWPC and the Marafiq’s consortium team have driven the entire project flawlessly and have now brought it to its financial close. Marafiq’s consortium has also succeeded in establishing a Saudi-based company to serve the project, the Jeddah Althaniya Water company, which will operate the plant for 25 years as part of an exemplary partnership between the public and private sectors.
Marafiq’s President and CEO, Abdullah K. Al-Buainain, said that “Marafiq is proud that it has shifted from a conventional utility service provider to a lead developer. Marafiq demonstrates its strength amongst Saudi corporations as it maintains reliable services that benefit the nation and support the 2030 vision. Marafiq is honored to have trusted relationships with local and international developers, as well as fiscal institutes. Marafiq is pleased to be able to support and strengthen the Saudi economy even during such challenging times. We are grateful to our partners Veolia and Amwal AlKhaleejiah, who have assisted us in reaching this stage in the project.’’
SWPC’s CEO, Khaled Z. Al-Qureshi highlighted that “the successful financial closing of Jeddah Airport 2 ISTP, shows the robustness and the efficiency of Private-Public-Partnerships, and we expect to see more of these type of projects as part of the Vision 2030”.
Amwal Chairman, Ammar A. AlKhudairy, said that “we are proud to have been able to achieve financial close for the project during globally challenging times of the pandemic, particularly that the Bank financing for the project was raised locally in its entirety”.
The CEO of Veolia Middle East, Sébastien Chauvin, stated that “the Jeddah Airport 2 ISTP is an ambitious and exemplary Public-Private partnership that aims to achieve the Kingdom’s 2030 Vision of high service quality for citizens and environmental compliance for the water sector. All the principles of the Circular economy will be put in place, allowing the reduction of sludge and enhancing the beneficial reuse of recycled water for irrigation or industrial use”.