Saudi Arabia's SWPC signs US$245mn financial closure for Dammam project

AdobeStock 91086758Saudi Water Partnership Company (SWPC) and a consortium led by the Metito Group, comprising Metito, Mowah Co. and Orascom Construction, have confirmed the financial closing of the kingdom’s first Independent Sewage Treatment Plant (ISTP)

The project will be awarded to the private sector, under the build own operate transfer (BOOT) concession model, with a tenor of 25 years, in Dammam West. The project is worth US$245mn with investments made in equity and debt.

The financial closing of this project comes despite the global lockdown, caused by COVID-19 pandemic, which has frozen many large-scale projects around the world. The Dammam ISTP, with a designed capacity of 350,000 cu/m and an initial capacity of 200,000 cu/m per day, will serve the western region of Dammam.

Khaled AlQureshi, CEO of SWPC, said, “Despite global volatility and liquidity issues, and the ever-changing market conditions, SWPC and the consortium were able to reach financial closing, in close co-operation with the lenders group.”

“This is a testament to SWPC’s commitment to encourage private sector participation in sustainable development, by providing lucrative opportunities to local and foreign investors for participating in the implementation of lifeline water projects. This will achieve sustainable development, provide job opportunities for young people, and support local output and balanced development, all of which falls in line with the strategic goals of the Kingdom’s Vision 2030. Saudi Council of Ministers had approved similar initiatives in the past, for encouraging private sector involvement in economic development,” added AlQureshi.

The consortium’s work covers the entire investment and includes engineering, procurement and construction, while the operations and maintenance will be executed by the Dammam West Company for Water.

The total project costs approximately US$245mn, with funding sourced from a combination of senior project finance loans, and equity contributions from shareholders. Non-recourse project financing worth US$160mn, is provided by a group of local and international banks, including The National Commercial Bank (NCB), Sumitomo Mitsui Banking Corporation Europe Limited (SMBC), and Arab Petroleum Investments Corporation (APICORP).

On behalf of the consortium, Rami Ghandour, managing director of Metito said, “While the world is navigating through unprecedented and testing times, we have reached a strategic milestone for the water and wastewater industry in MENASA region. Today marks the successful financial close of the Dammam ISTP, a pioneering project in the Kingdom and the region. The financial structure for this project is a testament to its importance, scale and impact, and the confidence of all stakeholders in its sustainable success.”

“We are confident that with SWPC’s support, the Dammam ISTP will pave the way for similar developments in future that can contribute to a more efficient water sector in the Kingdom and beyond,” he added.

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