Saudi Arabia’s Acwa Power is set to complete the financing for the $2.8bn Qurayyah independent power project (IPP) in late October, according to sources close to the project.

The company is scheduled to sign the power purchase agreement with Saudi Electricity Company (SEC) on 21 September, and banking sources say the project finance for the scheme should reach financial close about a month later.

The financing will enable Acwa to develop the Qurayyah plant, in Saudi Arabia’s Eastern Province, as a much larger facility than originally envisaged. Acwa was named preferred bidder for a project to develop a 1,800MW plant at Qurayyah in the second quarter of 2011, but has since been asked by SEC to develop a much larger facility, effectively taking the place of planned second 1,800MW project at the same site.

The financing group will consist $800m from three export credit agencies, South Korea’s Kexim, US-based Export-Import Bank (Exim), and Germany’s Hermes. A group of commercial banks will fund the project with a mixture of Saudi riyals and dollars, including the UK’s HSBC and Standard Chartered; Japan’s Sumitomo Mitsuibishi Banking Corporation (SMBC), the local Samba, National Commercial Bank and Banque Saudi Fransi.