Saudi Electricity Co (SEC) and its partners in a gas-fired power plant in the Kingdom of Saudi Arabia have refinanced a $1.14 billion loan for the project.

An executive at the State-run utility told Reuters the deal replaces financing taken out in 2010 for the Riyadh PP11 independent power project, which is 50 per cent is owned by SEC.
Riyadh IPP
A further 20 per cent is owned by French company Engie, with the remaining 30 per cent split evenly between Saudi Arabia’s Aljomaih Holding and Blue Horizon, a subsidiary of Japan’s Sojitz Corp. The plant became operational in 2013.

Many companies in the Gulf have been seeking to refinance debt as liquidity has been squeezed by a drop in oil prices.

Jean-Baptiste Roux, a United Arab Emirates-based financial adviser at Engie, said the refinancing aimed to improve the debt terms and profitability of PP11, also named Dhuruma Electricity Co.

The new debt facility includes a mini-permanent structure that is usually used until a project has been completed and can start producing income, the sources said. It includes an 85 percent cash sweep, typically used to funnel excess cash into repaying debt, and a subsequent margin step-up, the sources said.

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