Financing Secured for GE’s UAE Combined Cycle Project
Credit to Author: Darrell Proctor| Date: Wed, 05 Jun 2019 16:35:11 +0000
The first independent combined cycle power project in the emirate of Sharjah, in the United Arab Emirates (UAE), is taking shape after $1 billion in financing was recently secured from GE Energy Financial Services (EFS) and its partners.
The plant, featuring three combined cycle blocks, is expected to have 1.8 GW of generation capacity. The first block is expected to come online in 2021, with full commercial operation of the plant in summer 2023. The project was announced earlier this year but was awaiting financial backing.
The news comes on the heels of Siemens’ announcement that it will build what it says will be the UAE’s most-efficient gas-fired plant, a 600-MW combined cycle facility at an industrial site for Emirates Global Aluminum in Jebel Ali, Dubai. The Sharjah project partners include Japan’s Sumitomo, Shikoku Electric Power, and Sharjah Asset Management (SAM), with financing provided by Japan Bank for International (JBIC), Japan’s export credit agency (ECA), and other private financial institutions.
Susan Flanagan, who heads GE’s EFS group, said in a statement, “Sourcing financing from the public and private sectors to fund Sharjah’s first independent combined cycle power plant demonstrates the region’s attractiveness for foreign investment and GE’s ability to connect global capital to significant infrastructure projects. Once completed, the 1.8-GW project will be the first independent combined cycle power project in Sharjah. We are proud to partner with Sumitomo to deliver sustainable energy that utilizes GE’s state-of-the-art gas turbine technology and financial expertise.”
JBIC is expected to provide a second round of financing under its Global Facility to Promote Quality Infrastructure Investment for Environmental Preservation and Sustainable Growth, or QI-ESG initiative, which was launched by the Japanese government in 2018 to promote infrastructure development projects that are expected to contribute to global environmental protection.
GE is supplying three 9HA gas turbines for a new combined cycle power plant in Sharjah, in the United Arab Emirates. Courtesy: GE Power
GE-EFS and Sumitomo have created an equity consortium with Shikoku Electric Power and SAM in order to build, own, and operate the plant. The groups have a 25-year power purchase agreement (PPA) with the Sharjah Water & Electricity Authority (SEWA), which will buy the plant’s electricity. GE is supplying three 9HA gas turbines, three steam turbines, six generators, three heat recovery steam generators (HRSGs), and turnkey engineering, procurement, and construction (EPC) services for the project. GE also will provide parts, repairs, and maintenance services for the life of the PPA.
Dr. Rashid Alleem, chairman of SEWA, said earlier this year when the project was announced, “We are committed to strengthen Sharjah’s electricity infrastructure and provide seamless, affordable power. The proposed plant underlines our focus to promote public-private partnerships to drive a robust power production and management plan that is aligned with local energy needs, as well as the optimal utilization of natural resources.”
Norihiko Nonaka, general manager of the Global Power Infrastructure Business Division at Sumitomo, said, “Sumitomo remains committed to supporting the continuing economic growth in the United Arab Emirates through the delivery of reliable, cost effective, clean and sustainable power from both our existing and new power infrastructure.”
Joseph Anis, president and CEO of GE’s Gas Power Systems and Power Services businesses in the Middle East and South Asia, said, “GE has contributed to the growth of the Gulf Cooperation Council’s (GCC’s) power sector for over 80 years and GE-built technologies generate up to 60 percent of Sharjah’s electricity today. This project is another major milestone in our ongoing collaboration with SEWA and we are honored to provide technological and financial solutions that support the vision of a sustainable, secure energy future for the people of Sharjah.”
The Siemens-built plant in Dubai will feature one of the company’s H-class turbines, which will be used in the Persian Gulf for the first time. Abdulnasser Bin Kalban, CEO of Dubal Holding, owner of EGA, in a statement said, “This is a significant project as we continue to broaden our industrial footprint. We are pleased to be partnering with Siemens to bring this technology to the UAE for the first time, constructing a regional benchmark for energy efficiency in local manufacturing.”
Dubal Holding and another UAE business, Mubadala, are establishing a joint venture to develop the new plant, which will power the smelter. The EGA has a 25-year PPA with the plant. EGA is the largest non-oil and gas industrial company in the UAE.
—Darrell Proctor is a POWER associate editor (@DarrellProctor1, @POWERmagazine).
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