Gulf Construction Online - Finance deal signed for Dammam ISTP

Saudi Focus

Finance deal signed for Dammam ISTP

01 July 2020

Saudi Water Partnership Company (SWPC) said it has joined hands with a consortium led by the Metito, a leading provider of total intelligent water management solutions, to reach the financial closing of the kingdom’s first independent sewage treatment plant (ISTP) being set up at an investment of $245 million.

The consortium comprises key partners Saudi Arabia-based Mowah and Egypt’s Orascom Construction.

The project, located at Dammam West, will be awarded to the private sector under the build-own-operate-transfer (BOOT) concession model with a tenor of 25 years. The $245 million investment for the project will come from a combination of equity and debt.

Announcing the achievement, SWPC said the financial close of this ‘first of its kind’ project comes in spite of the global Covid-19 pandemic, which has frozen many large-scale projects around the world.

The Dammam ISTP has a designed capacity of 350,000 cu m per day and will serve the western region of Dammam. It boasts an initial capacity of 200,000 cu m per day.

CEO Khaled Al Qureshi said: “Despite global volatility and liquidity issues, and ever-changing market conditions, we have been able to successfully reach financial closing with the consortium, in close cooperation with the lenders group.”

The consortium’s scope of work covers the entire investment and includes the engineering, procurement and construction (EPC) and operation and maintenance (O&M) which will be executed by Dammam West Company for Water, a wholly-owned Saudi-based company established by the consortium to serve the project.

Non-recourse project financing is provided by a group of local and international banks, including The National Commercial Bank (NCB), Sumitomo Mitsui Banking Corporation Europe Limited (SMBC), and Arab Petroleum Investment Corporation (Apicorp), worth a total of $160 million.

“Reaching this stage in the project and resuming construction work under these difficult circumstances indicates confidence in the investment environment in the Kingdom of Saudi Arabia and its suitability for the private sector,” stated Al Qureshi.

Metito Managing Director Rami Ghandour said: “While the world is navigating unprecedented and testing times due to the fast-evolving Covid-19 pandemic, we are delighted to share a strategic milestone for the water and wastewater industry in the Mena and South Asia region.”

“We mark the successful financial close of the Dammam ISTP, a pioneering project in the kingdom and the region. The financial structure for this project is a testament to its importance, scale and impact, and the confidence of all stakeholders in its sustainable success,” he noted.

“We are confident that with the continued support from SWPC, the Dammam ISTP will pave the way for similar developments in the future that can contribute to a more efficient water sector in the Kingdom and beyond,” added Ghandour.