Facility D independent power & water project (IWPP) in Qatar will reach a financial close in mid-November.

Six Japanese banks, led by the Japan Bank for International Cooperation will finance the project, as well as the Qatar National Bank and Germany’s KfW Development Bank.

The 25-year project finance deal will have a very competitive interest rate of 1.5 per cent over London interbank lending rates (Libor).

Japan’s Mitsubishi Corporation and Tokyo Electric Power Company (Tepco) are the developers. They will own 20 and 10 per cent respectively of the project company, Umm al-Houl Power, through a holding company.

The state-owned Qatar Electricity & Water Company (QEWC) owns a majority 60 per cent stake, while Qatar Petroleum (QP) and Qatar Foundation (QF) each hold 5 per cent.

Facility D will have a capacity of 2,500MW and 123.5-136.5 million imperial gallons a day (MIGD) of desalinated water. The IWPP is expected to require an investment of about $3bn. 

The first power from the scheme is expected in 2017, with the whole facility scheduled to come online in 2018. The IWPP will be located in the Qatar Economic Zone (QEZ) near Mesaieed.

Samsung C&T was awarded the $1.8bn contract for engineering, procurement and construction (EPC) on the power plant in July. Germany’s Siemens will supply the turbines and generators.

Japan’s Hitachi Zosen will carry out the desalination EPC works, with Spanish Acciona Agua as a subcontractor.

About 70-90 million imperial gallons a day (MIGD) of the desalination capacity will be from multi-stage flash (MSF)/multi-effect distillation (MED) technology, with the remaining 40-60 MIGD coming from reverse osmosis (RO) technology, which has to date only been implemented on a small scale in the country.