• Two Rabigh projects secure funding
  • Projects cover petrochemicals and power and water
  • Investment continues despite lower oil prices

Saudi Arabia is moving forward with its infrastructure plans despite low oil prices, with two major projects securing funding in March.

With oil prices expected to hover around $55 per barrel for the remainder of 2015, there were concerns that some projects in the oil-exporting Gulf countries may be stalled or postponed.

Yet, within the last few weeks both the Rabigh independent water steam and power plant (Rabigh IWSPP) and PetroRabighPhase II project have raised debt facilities to support their expansion plans.

Rabigh Arabian Water & Electricity Company reached financial close on 16 March on a $776m facility to fund the expansion of its IWSPP project based on the Red Sea coastline of Saudi Arabia.

The project sponsors are

The existing plant provides

  • 5,580 tonnes/hour of water,
  • 1,230t/hr of steam and
  • 360MW of electric power.

The expansion will add an additional

  • 2270t/hr of water,
  • 1015t/hr of steam and
  • 160MW of electric power.

Commercial operations are expected to start in the first half of 2016.

Rabigh Refining & Petrochemical Company (PetroRabigh) has also signed project finance documents for $5.2bn. The project company’s main shareholders are Japan’s Sumitomo Chemical and Saudi Aramco.

The funding will support the PetroRabigh Phase II project, which involves the expansion of its existing integrated refinery and petrochemicals complex.

The total project costs are approximately $8.1bn.

Sumitomo Mitsui Banking Corporation and Saudi British Bank are financial advisers on the PetroRabigh. The facility includes a tranche in Saudi riyal.

The project involves PetroRabigh expanding its ethane cracker and building a new aromatics complex that will enable it to process newly allocated 30 million standard cubic feet a day of ethane and approximately 3 million tonnes a year of naphtha as a major feedstock to produce petrochemical products.

Production is expected to start in the first half of 2016.

Stay informed with the latest in the Middle East
Download the MEED app today, available on Apple and Androiddevices