Of the total project costs of $400 million, Kahrama is looking to raise $280 million in debt financing. The French export credit agency’s tranche is expected to amount to about $100 million, while the Japan Bank for International Co-operation is likely to provide $100 million-130 million. The remaining amount will be provided either by Washington-based Overseas Private Investment Corporation (OPIC) or through a commercial loan. ‘There has been serious appetite for a commercial tranche,’ says a project source. ‘Banks want some Algerian paper on their books.’

The Arzew IWPP is expected to be one of the first projects to benefit from an upgrade in the Coface rating on Algeria from five to four.

The upgrade, announced in late October, was in line with an OECD reclassification. Kahrama is targeting financial close by the end of the year. Its financial adviser is Mizuho Financial Services.

A Japanese consortium of Itochu Corporationand Ishikawajima-Harima Heavy Industrieswas awarded the $260 million engineering, procurement and construction (EPC) contract to build the 314-MW, 88,000-cubic-metre-a-day plant at the start of the year. GE Power Systemsof the US will supply the turbines (MEED 1:2:02).