Saudi Electricity Company (SEC) has won a US$989mn 12-year facility from five commercial banks to finance the Shoaiba III thermal power plant.

The deal is the largest financing by France’s Coface in Saudi Arabia, as well as the SEC’s first European ECA-backed deal.

The loan was provided by HSBC, Citibank, Deutsche Bank, Sumitomo Mitsui Banking Corporation and The Bank of Tokyo Mitsubishi.

HSBC acted as the structuring bank and lead arranger.

France’s Coface insured the deal, while Euler Hermes provided reinsurance.

Peter Luketa, HSBC’s global head of export finance, says: “What is also worth noting in this financing is the support which was secured from Hermes in the form of reinsurance to Coface for a portion of equipment and services sourced by Alstom in Germany, reflecting the multi-sourced nature of the contract and illustrating how ECAs can successfully work together to maximise support for borrowers.”

The 200 MW steam power plant project will be based at the Shoaiba site on the Red Sea coast and will be installed and commissioned by Alstom, in consortium with Saudi Archirodon.

Unit 1 is expected to be commissioned on September 1, 2011, unit 2 on December 1, 2011 and unit 3 on August 15, 2012. Upon completion of the project, the plant complex will comprise 14 units of 400 MW each with a gross total output of 5,600 MW.

The plant will be fitted with air abatement measures including electrostatic precipitators, sea water flue gas desulphurisation and low nitrogen oxide burners to reduce gas emissions of particulate matter, sulphur dioxide and nitrous oxides.