Consortium in discussions with banks
- Japans Mitsubishi Corporation and Tokyo Electric Power Corporation looking to tap Japanese financing for Facility D project
- Consortium is in preliminary discussions with banks including Japan Bank for International Cooperation
- Facility D is expected to require investment of about $3bn
The consortium that won Qatars Facility D independent water and power project (IWPP) Japans Mitsubishi Corporation and Tokyo Electric Power Company (Tepco) is looking to Japanese sources of funding.
Japan Bank for International Cooperation (Jbic) is in preliminary discussions with the consortium.
We are discussing financing with government-related banks, commercial banks and Japanese banks, says a representative of Tepco. Japanese banks will be the most important.
None of the parties would comment on Jbics level of involvement. The export credit agency is not, however, involved in financing Mitsubishis other project in Qatar, the $500m Ras Abu Fontas 3 independent water project.
Facility D is expected to require an investment of about $3bn. The IWPP, which is also known as Umm al-Houl, will have a capacity of 2,500MW and 590,000 cubic metres a day of desalinated water.
Given the level of financing involved, there are a limited number of financers they can go to, says a Doha-based lawyer. Obviously they can get a consortium, but you dont want that to get too big.
The development consortium has signed a contract with Qatar General Electricity & Water Corporation (Kahramaa) to develop the IWPP.
Mitsubishi and Tepco have established a joint venture called K1 Energy for the project. Mitsubishi holds a 98.5 per cent equity share in the venture, while Tepco currently holds a 1.5 per cent share, which it will increase by the middle of 2015.
Eventually we are going to increase our stake to 33.3 per cent, says the Tepco representative. We are putting in more equity gradually.
Tepco is also planning to increase its participation in overseas independent power projects, as part of its strategic business plan.
K1 Energy will hold 30 per cent of the equity in a special-purpose vehicle, which will be formed to build, own and operate the IWPP. Qatar Electricity & Water Company (QEWC) will hold 60 per cent, with Qatar Petroleum and Qatar Foundation holding 5 per cent each.
You might also like...
PIF entity makes $1bn Lucid placement
29 March 2024
Petro Rabigh awards KBR maintenance contract
29 March 2024
Diriyah Company seeks firms for demolition package
29 March 2024
Consultant appointed for Ellington Views RAK project
29 March 2024
A MEED Subscription...
Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.