The Egyptian Electricity Holding Company (EEHC) has secured a loan worth US$650mn to develop the Assiut and West Damietta combined cycle power plants in Egypt, reaching financial close for the projects.

The loan is extended by a European banking alliance led by BNP Paribas to the EEHC, which operates under Egypt’s ministry of electricity and renewable energy. It will go towards the conversion of the two natural gas-fired power plants from simple to combined cycle, executed by a consortium of Orascom Construction and General Electric (GE). The loan covers 85% of the total project value.

BNP Paribas acted as co-ordinating initial mandated lead arranger, and Crédit Agricole, Crédit Industriel et Commercial and ING Bank as mandated lead arrangers. The Italian export credit agency Sace is extending insurance cover for 100% of the loan.

“This milestone ensures that Assiut and West Damietta power plants are fully financed, with the foreign currency portions committed by international banks and guaranteed by an export credit agency,” Orascom Construction, one of the developers, says in a statement.

The two plants are currently operational and have a total power generation capacity of 1,500MW. The conversion to combined cycle is expected to increase capacity by approximately 50% with no additional fuel intake. Furthermore, the projects will reduce the power plants’ carbon and NOx emissions by 32%.

Two other combined cycle power plants in Egypt, New Capital and Burullus, which are also under construction, reached financial close in March 2016. Upon completion, the four power plants will have a total power generation capacity of 11,850MW, according to Orascom Construction.