State-owned oil major Saudi Aramco is looking for a financial adviser for the development of its 2.4GW power plant in Jizan, which is expected to cost about $2bn.
Bids for the role are due by mid-January, and Aramco is due to hold meetings with the bidders before the end of the month. Sources involved in the process say an appointment could be made during February as the oil firm tries to push forward with the scheme.
Lenders interested in the role have been asked to form a consortium with a local bank. The international banks that have been invited to bid for the mandate are the UK’s HSBC, Standard Chartered and Barclays; the US’ Citigroup and Goldman Sachs; Germany’s Deutsche Bank, and Japan’s Mizuho and Bank of Tokyo Mitsubishi.
One banker in the kingdom says it is likely that no French lenders were invited to advise Aramco on the Jizan plant as none are involved in financing the oil firm’s $20bn Sadara petrochemicals project.
The Jizan integrated gasification combined-cycle (IGCC) power project is a strategically important one for Aramco and the kingdom. Aramco needs about 500MW of power for its $7bn oil refinery under development adjacent to the site of the utility plant. The rest of the facility’s output is intended for other industrial projects as part of Riyadh’s plan to create jobs in the impoverished southwest area close to the Yemen border at Jizan Economic City.