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Wednesday, 16 November 2022

The SFE could acquire 10% of ACWA, Hassan Allam wind farm

SFE could invest in 1.1 GW wind farm being developed by ACWA, Hassan Allam: The Sovereign Fund of Egypt (SFE) could acquire a minority stake in ACWA Power’s planned 1.1-GW wind farm in the Gulf of Suez. The wealth fund is considering making an investment in the facility under the terms of an MoU signed with the Saudi renewables developer yesterday, which could see it “potentially acquire up to 10%” of the USD 1.5 bn project, the SFE said in a statement (pdf). That would see the fund invest up to USD 150 mn in the project, according to our math. A final agreement will be announced “soon,” three sources familiar with the matter told Bloomberg Asharq yesterday.

The second sovereign fund to the party: News of the SFE’s potential buy-in comes a week after the Oman Investment Authority inked an MoU with ACWA to acquire a 10% stake in the wind farm. The SFE would also buy its stake from ACWA, which currently owns 75% of the project, while Hassan Allam Holding is set to retain its 25% stake, according to Asharq.

More finance in the pipeline? The European Bank for Reconstruction and Development (EBRD) is eyeing a potential investment in the Suez farm, Harry Boyd-Carpenter, the EBRD’s managing director for climate strategy and delivery, told Enterprise earlier this week. Some 70-75% of the wind farm will be financed through loans, while the remainder will be self-financed, Asharq quotes its sources as saying. The project is expected to reach financial close by 4Q 2024.

REFRESHER- ACWA and Hassan Allam Holding signed a 25-year power purchase agreement (PPA) with the Egyptian Electricity Transmission Company (EETC) in June to develop the project under a build-own-operate framework. The project is expected to begin commercial operations by the end of 2026.

AND ANOTHER WIND FARM IN THE GULF OF SUEZ-

GE could work on 1.5-GW Suez wind farm: General Electric, the Egyptian Natural Gas Holding Company (EGAS), and subsea robotics firm Seasplit Technologies will do feasibility studies on a 1.5-GW offshore wind farm in the Gulf of Suez under an MoU signed earlier this week, according to a joint statement. The farm will be used to power offshore oil and gas facilities, with excess power sent to the national grid.

That’s almost 30-GW of wind power: Egypt has lined up 29.5 GW of wind projects in recent days, equivalent to half of the country’s total installed power generation capacity. It’s almost nine times the country’s renewable power generation capacity, which stood at 3.4 GW at the end of 2021. Among the new projects on the horizon are two 10-GW wind farms, which will be two of the biggest in the world when running at full capacity.

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