Dec 26 2005 |
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Mubadala Development, SNC-Lavalin win bid for USD900 million Algeria project
Abu Dhabi - Abu Dhabi-based Mubadala Development Company has entered into a Joint Bidding Agreement (JBA) with SNC-Lavalin Inc., the preferred bidder for a project to build, own and operate a 1,200 Megawatt power generation plant at Hadjret Ennous in western Algeria. The project's total value is estimated at $ 900 million (approximately AED 3.3 billion).On December 17, SNC-Lavalin was announced as the winning bidder for the Independent Power Project (IPP). Following the announcement, a protocol agreement on the terms of the required investment in the project company was signed with the Algerian Energy Company (AEC) which is equally owned by the state energy company Sonatrach and the state power company Sonelgaz.
HE Khaldoon Khalifa Al Mubarak, Chief Executive Officer of Mubadala Development, said the investment in Hadjret Ennous IPP is in line with the company's utilities investment strategy in the emerging markets of North Africa.
"Mubadala Development is extremely bullish on Algeria's fast growing energy sector. This is our debut venture in the promising North African utilities sectors and we seek to use it as a step towards other investment opportunities in Algeria, as it has always been a prime focus of our interest," he said.
"We are also very pleased to be partnering with SNC-Lavalin in this project. The JBA with SNC-Lavalin is not only strategic in nature, but also provides several potential opportunities for future cooperation in other markets," added Al Mubarak.
Under the JBA, Mubadala Development and SNC-Lavalin will equally co- invest to own a 51% stake in the project company. The remaining 49% of the project company will be owned by Algerian Government entities.
Sonelgaz will guarantee the purchase of the power produced by the plant to fuel growing demand for electricity in Algeria, estimated at 4% per annum, and will sign an energy conversion agreement to that effect with the project company.
An estimated $ 650 million of the project's cost will be raised through financing on a non-recourse basis via 70:30 debt to equity ratio.
Meanwhile, Mubadala Development and SNC-Lavalin are in the process of acquiring a substantial stake in the newly built 800 Megawatt combined cycle power plant of Skikda, in eastern Algeria.
The Skikda power plant is being built by SNC-Lavalin, and is scheduled to be commissioned in the first quarter of 2006.
Mubadala Development is a Public Joint Stock company, established and wholly owned by the Government of Abu Dhabi with a mission to invest in commercially-viable, strategic, industrial and commercial partnerships. The company manages a diversified portfolio of local, regional, and international investments.
International investments include the Italian luxury sport car maker Ferrari (5% stake), the Dutch fleet management giant LeasePlan Corporation (25% stake), and a stake in nine oil exploration blocks in Libya.
Locally and regionally, Mubadala Development has invested in, and developed, a number of leading projects including the first GCC cross-border natural gas project, Dolphin Energy (51% majority stake), Aldar Properties, National Central Cooling Company, Abu Dhabi Ship Building, Imperial College London Diabetes Center in Abu Dhabi, Injazat Data Systems, and Tanqia. Mubadala Development is also leading the development of the UAE University's new campus in Al Ain City through a Public-Private Partnership initiative.
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