RIYADH, SAUDI ARABIA -- June 22, 2009 -- Saudi Electricity Company (SEC) announced that it signed a 12-year direct loan agreement for SR4.1 billion ($1.1 billion) to finance the supply and installation of GE equipment for expanding the Qurayyah and Faras power plants in the Eastern Province and Power Plant No. 8 in Riyadh, which will add 2,900 megawatts of power generation capacity. The direct loan will be disbursed and managed through the funding bank, Calyon New York.
The financing will cover 23 GE Energy 7FA gas turbines featuring advanced combustion technology for lower emissions, and offering high levels of efficiency and reliability, and fuel flexibility.
"This agreement is important to support our policy to diversify our funding sources. It will also contribute to a great extent to freeing up funds which will be used to develop new projects to expand power capacity around the country to support our country's population and industrial growth," said Eng. Ali Saleh Al-Barrak, president and CEO of Saudi Electricity Company.
"This agreement also demonstrates the high level of collaboration and the strong partnerships SEC has developed with equipment manufacturers and contractors. GE is one of SEC's most important strategic partners. Building on their 40-year strong relationship, GE has been working closely with the Saudi electricity sector to identify financing solutions needed for Saudi power projects. This close cooperation resulted in SEC obtaining this loan and in strengthening its relationship with global export credit agencies, including US Ex-Im Bank and Export Development Canada (EDC).
"These power projects reflect our commitment to help Saudi Arabia and the Middle East meet a growing need for reliable power to support economic and infrastructure growth." said Joseph Anis, GE Energy's Region Executive for the Middle East. "Not only can GE deliver innovative technology localized services, but we also can call upon GE's regional and global resources for additional support; in this case, GE Capital Markets Corporate played a key role in facilitating the Ex-Im Bank and EDC direct loans."
When completed, the three power plant expansion projects, covered by the direct loan agreement, will add a capacity 2,907 megawatts to the Kingdom's electricity. These include, as announced earlier:
*Fifteen GE Frame 7FA gas turbine-generators for the Qurayyah Power Plant Expansion, to expand the plant's capacity by 1,907-megawatts in Saudi Arabia's Eastern Province
*Four 7FA units for the Faras Power Plant Expansion, also located in the Kingdom's Eastern Province, to expand the plant's capacity by 509 megawatts (together, the Qurayyah and Faras plants will supply 25% of the Eastern Province's existing electricity output)
*Four 7FA machines for the Riyadh Power Plant No. 8 Expansion in Saudi Arabia's Central Province, to expand the plant's capacity by 491 megawatts. The PP8 project featured the shipment of GE's 1,000th advanced F-technology gas turbine.
Rania Rostom