The five-year facility, lead arranged by National Bank of Abu Dhabi on a sole basis, has a step-up pricing structure (MEED 8:3:02). Starting at 37.5 basis points (bp) over Libor for the first year, it rises to 40 bp for the second and then to 45 bp for the remaining three years. Up-front fees of 15 bp were offered.

An international banker participating in the transaction ascribed the tight pricing to the fact that there is effectively a government of Abu Dhabi guarantee underpinning the facility.

Bankers say plans have been drawn up to replace the bridge facility with a properly structured project finance package when the power and water plant and a 185-kilometre pipeline linking it to Al-Ain are completed.

UWEC is aiming to take a foreign partner into the project once the gas supply and water and power offtake agreements are in place. Once this process – and the refinancing – is completed, the project will have a structure similar to the other private sector generation companies already established in Abu Dhabi, though the path to achieving this structure will have been very different.