Saturday, September 30, 2017

Saudi SWCC picks BNP for $7bn power plant sale

Saudi Arabia has hired BNP Paribas SA to advise on the sale of Ras Al Khair power plant, the largest of its kind bing built at a cost of $7.2 billion, reported Bloomberg, citing people familiar with the matter. 

Saline Water Conversion Company (SWCC), is working with the French lender to find a buyer for the plant, stated the report.

The sale is part of a broader strategy to privatize SWCC by selling some of its existing assets and developing new plants with the private sector, the report added.

Saudi Arabia is planning to sell hundreds of state assets, including Saudi Arabian Oil Company, stakes in the stock exchange, football clubs and flour mills as part of a reform program spearheaded by Crown Prince Mohammed Bin Salman. 

Privatizations could exceed $350 billion over the next five years, according to Elyas Algaseer, co-head of Mitsubishi UFJ Financial Group Inc. in the Middle East and North Africa. SWCC has been working on its privatization since 2015, said the Bloomberg report.

The plant at Ras Al Khair on the kingdom’s east coast provides power for an industrial city that includes aluminum and bauxite facilities owned by Saudi Arabian Mining Company, and is being developed into a maritime industrial hub by Aramco. 

The plant started operations in 2014 and produces 2,600 megawatts of power and 1,025 million cubic meter of desalinated water, making it the biggest desalination and power plant in the world it added.

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