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Financial close of US$280mn for Jeddah Sewage Treatment Plant reached by Marafiq-led consortium

The financial closing of US$ 280mn Independent Sewage Treatment Plant (ISTP) project in Jeddah has been successfully reached by Saudi Water Partnership Company (SWPC) and a consortium composed of Marafiq, Veolia and Amwal Al Khaleejiah.

Marafiq (Power and Water Utility Company for Jubail and Yanbu) is the lead developer in Jeddah Airport 2 ISTP. This ISTP project 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, and Amwal Al Khaleejiah, who will support the development, financing, engineering, procurement, construction (EPC), implementation, ownership, operation, maintenance, and transfer of the Jeddah Airport project.

Khaled Z. Al-Qureshi  CEO of SWPC commented 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″.

Abdullah K. Al-Buainain President and CEO of Marafiq said:

” 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.’’

Inspite of the COVID-19 pandemic the consortium’s teams have issued a notice to proceed with the EPC contractor as per the agreement with SWPC. The stages are as follows:

  • Stage one will treat 300,000 m3 per day, scheduled to be commissioned on January 31, 2023
  • Stage two could possibly add another 200,000 m3 per day when the new STP capacity exceeds specific utilization rates

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”.

The US$ 280mn 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.

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