The five consortiums bidding for the planned $2.5bn PP11 independent power project (IPP) in Riyadh have now all secured financial support from banking groups, with the local Samba and Alinma banks each supporting four groups.

The two Saudi banks have pledged to provide up to $1bn in support to groups led by Marubeni and Sumitomo Corporation, both of Japan, to Belgium’s Suez Energy International and to the UK’s International Power.

A fifth group, led by the local Acwa Power, is being backed by the local National Commercial Bank and Al-Rajhi, along with Japan’s Sumitomo Mitsubishi Banking Corporation. The Marubeni, Sumitomo and Acwa consortiums are also in talks to secure further support from export credit agency the Japan Bank for International Cooperation (JBIC).

The Marubeni consortium emerged as the low bidder on the project when bids were opened on 21 December. However, the extremely low tariff that it submitted has surprised the other developers competing for the deal.

The Marubeni team, which also includes Japan’s Kansai Electric Power Company and Saudi Masader, bid a tariff of SR0.07 ($0.0207) a kilowatt hour for the build-own-operate scheme.

That is 28 per cent lower than the tariff submitted by the second-ranked bidder, Suez Energy International/Al-Jomaih Group.

It is unclear how the Japanese consortium has managed to submit a price so much lower, leading other bidders to speculate that the group might have omitted the fuel cost from the tariff or miscalculated the cost of electricity.

“It doesn’t make sense,” says a source at one bidding group.

However, if Marubeni’s figures are correct, developers agree it deserves to win the contract. “If the Marubeni consortium can comply with the RFP and deliver that tariff they surely deserve to be awarded this project without delay,” says another rival bidder.

Neither Marubeni nor SEC could be reached for comment.