The US$2.23bn Fujairah F2 independent water and power project (IWPP) has reached financial close. The mandated lead arrangers are Calyon, Citigroup and SMBC. The Japan Bank for International Cooperation (JBIC) also contributed towards the facility.
The project is in the Emirate of Fujairah, in the United Arab Emirates. It will comprise a new-build power generation and water desalination plant capable of producing 2,000MW of power upon completion in 2010.
The plant's power and water output will be sold to Abu Dhabi Water and Electricity Company under a 20-year power and water purchase agreement.
Fujairah Asia Power Company, which owns the plant, is 60% owned by Abu Dhabi Water and Electricity Authority. International Power and Marubeni Corporation each own 20% each.
A joint venture between International Power and Marubeni, known as O&M Company, will be operating the plant.
Law firm Ashurst advised the lenders. Commenting on the deal, David Wadham, Dubai-based energy partner at Ashurst says: "The Fujairah F2 IWPP represents one of the largest greenfield power and water plants to have been built in the region over the past few years and the largest project financing undertaken in the Emirate of Fujairah.
“It has been a pleasure to work with funders and sponsors on this project and to achieve financial close notwithstanding the challenging conditions prevailing in the Middle East construction market. The plant will serve to meet Abu Dhabi's increasing power and water demand and will therefore play an important role in sustaining Abu Dhabi's continuing industrial and economic growth.'
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