by Nick Flitterman

On 16th September 2010 a consortium led by GDF Suez SA and advised by Portland Advisers completed a $1.3bn long term debt financing for two independent power projects in Oman.

The projects are greenfield natural gas-fired power plants with capacity of 744 MW each. . Total investment cost will be around $1.7bn for both projects. Their power output will be sold under two separate 15-year power purchase contracts to the Oman Power and Water Procurement Company (OPWP), who will be the single off-taker. Siemens AG and GS Engineering of South Korea are the EPC contractors.

The project is financed through a blend of equity, early generation revenues and a senior debt facility involving export credit agencies Euler-Hermes and Korea Eximbank, and a club of eight international banks : Natixis, KfW-IPEX, Credit Agricole, HSBC, Bayerische Landesbank, Europe Arab Bank, CIC, and Standard Chartered Bank.

Geoff Knox, Portland’s Head of Energy, said: “Portland Advisers were delighted to have the opportunity to advise GDF Suez on this major financing. The deal was structured and negotiated at the bid submission stage last year when financial markets were still recovering from the financial crisis. The competitive financing submitted with the bids were important elements to the consortium being awarded both projects.”

GDF Suez holds a 46% interest in the consortium, the rest being held by Shikoku Electric Power Company (Yonden) (11%), Sojitz Corporation (11%), both from Japan, and Bahwan Engineering Group (22%) and the Public Authority for Social Insurance (PASI) (10%) of Oman.

For more information on this transaction, or on related topics, please contact Geoff directly on geoff.knox@portlandadvisers.com or +44 20 71 83 83 87.

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