Saudi's Marafiq first utility online in Jubail

About This Company

Established in terms of Royal Decree M/29 of 18 October 2000 (22 Rajab 1421 Hijra) as a joint-stock company, Marafiq is owned by its four major shareholders - the Royal Commission for Jubail and Yanbu (RC), Saudi Basic Industries Corporation (SABIC), Saudi Arabian Oil Company (Saudi Aramco), and the Public Investment Fund (PIF). Seven private-sector investors make up the remaining shareholders. Marafiq started operating as a private power and water utility company on 1 January 2003, with SR 2,5 billion of initial owner equity.

Marafiq's headquarters are in Jubail Industrial City on the Arabian Gulf, and the regional office is based in Yanbu Industrial City on the Red Sea. A representative office is located in Riyadh.

Marafiq's main objective, as stated in its charter, is to undertake the operation, maintenance, management, expansion and construction of seawater cooling systems, desalinated and treated water systems, sanitary and industrial wastewater systems and electric power systems to provide essential utility services to industrial, commercial and residential customers in the industrial cities of Jubail and Yanbu.
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Mon, Oct 12 09:16 AM EDT

*Saudi's Marafiq independent utility online

*Plant will be fully operational by Q1 2010

By Asma Alsharif

JEDDAH, Saudi Arabia, Oct 12 (Reuters) - Saudi Arabia's Marafiq, a power and water utility company has brought online its first independent water and power plant (IWPP) with a capacity of 2,700 megawatts, a company executive said on Monday.

Start-up of the plant, which also produces 800,000 cubic meters of desalinated water per day was a few months ahead of schedule due to high demand from the capital Riyadh, Sultan al-Ruhaili, general manager of technical affairs at Marafiq said.

"Jubail's project is operational... Before schedule but not in full production. We have just started operations in August this year," Ruhaili told Reuters on the sidelines of an industry conference in Jeddah on the Red Sea coast.

"We started earlier because of demand in Riyadh. The demand in Riyadh is very high," he added.

"Now (the project) is 20 percent operational and in the first quarter of 2010 it will be in full production, maybe even before that," Ruhaili said.

Marafiq, which was set up in 2000 to provide integrated utility services in the kingdom's main industrial cities, Jubail and Yanbu plans to launch bids for a new power plant in Yanbu that has a capacity of 750 MWs early next year, Ruhaili said.

"In the first quarter of 2010 we will tender another plant in Yanbu so we have Yanbu 1 and Yanbu 2, the capacity can be expanded if needed," he said.

Marafiq is increasing the capacity of its power generation plants to meet rising power demand from industry in Yanbu and Jubail.

In July, it awarded South Korea's Hanwha Engineering Construction Corp [HANWHE.UL] a $750 million deal to expand the current power output from the existing plant in Yanbu to 1,500 MW from 1,000 MW.

Hanwa is a prequalified bidder (for the new Yanbu plant) and GE and Mitshubishi are potentially prequalified if they team up with a local contractor, he added.

Marafiq's main shareholders are the Royal Commission for Jubail and Yanbu, Saudi Basic Industries Corp (Sabic) and the Public Investment Fund (PIF).

Ruhaili said his company will sign on Monday a new contract worth 400 million Saudi riyals with Sete Energy for a 48,000 cubic meters per day Industrial Wastewater Treatment Plant. (Editing by James Jukwey)

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PFI - Aramco/Total US$8.5bn loan signing
Tue, Jun 22 10:18 AM EDT

* Signing today

* Financial close in a few weeks

By Rod Morrison

LONDON (Project Finance International) - The US$8.5bn project financing funding the Aramco/Total (TOTF.PA) Jubail refinery scheme is signing today in London at the offices of Linklaters. Financial close on the deal, when the debt can actually be drawn down, is expected in a few weeks but the signing is a key event with lenders now committed to the project.

The deal has taken some time to put together and was due, under its original timetable from last summer, to close last November. The pricing on the deal sets a low for international projects post crunch crunch at sub 200bp for the international lenders but the main reason for the low pricing is the client relationship pull of Aramco.

The sponsors have included a US$995m loan from themselves in the package as the proposed sukuk bond issue has not been transacted in time. This sponsor loan could still be taken out later by a sukuk and a Saudi Industrial Development Fund (SIDF) tranche. The international commercial bank tranche on the deal totals US$1.485bn, the local bank tranche US$2.09bn, the export credit agency (ECA) covered tranche, US$2.2bn, ECA direct tranche US$490m, Public Investment Fund (PIF) US$1.3bn, and sponsor loan, US$995m. The ECAs are Keic/Kexim from South Korea, Nexi from Japan, Cesp from Spain, Coface from France and Hermes from Germany. Fifteen international banks have joined the deal.

Aramco was due to move onto financing its next similar sized scheme at Yanbu once Jubail was signed but its plans have been upset by the decision of ConocoPhillips (COP.N) to pull out of that scheme in April. Nevertheless it has been an active time for the Saudi funding market. Last week GDF Suez (GSZ.PA) reached financial close on its US$2bn PP11 power project. State mining company Ma'aden and Alcoa (AA.N) are currently in the market on their US$7.5bn aluminum smelter financing.

Local banks are highly liquid with funds at present. State utility Marafiq is raising a US$667m loan at present with pricing around the 100bp mark. International banks find that level of pricing very difficult to live with. But they are still required to fund the dollar tranches of Saudi projects, to avoid currency mismatches on equipment imports for schemes.

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S.Korea's Hanwha E&C wins $1.05 bln Saudi order
Tue, Apr 19 19:56 PM EDT

SEOUL, April 20 (Reuters) - South Korea's Hanwha Engineering & Construction said on Wednesday that it had won a $1.05 billion order to build power and seawater desalination facilities in Saudi Arabia.

Unlisted Hanwha said in a statement that was awarded the project, which will be completed by 2014, by Saudi state utility Marafiq. (Reporting by Ju-min Park; Editing by Jonathan Hopfner)

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Doosan Heavy wins $80 mln Saudi desalination plant deal
Tue, Sep 13 01:02 AM EDT

SEOUL, Sept 13 (Reuters) - Doosan Heavy Industries & Construction Co Ltd , a South Korean power generation facilities builder, said it signed an $80 million deal on Tuesday to build a seawater desalination plant in Saudi Arabia.

Under the contract with Marafiq, a state-run Saudi company, Doosan will complete the multi-effect distillation (MED)-type plant, to be built in Yanbu, some 350 kilometres (220 miles) northwest of Saudi Arabia's second-largest city of Jeddah, in March 2014. The plant will be able to produce 54,000 tonnes of fresh water a day, Doosan said in a statement.

The contract came after Doosan in February obtained another order from Saudi Arabia to construct a similar MED-type desalination plant capable of producing 68,000 tonnes of fresh water per day in Yanbu, the company added. (Reporting by Sung-Won Shim; Editing by Jacqueline Wong)

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