Dubai Waste Management Co secures finance for mega renewable electricity project

$900mln long-term project finance deals sealed for 200-megawatt project

  
Electricity pylons in front of industrial chimneys Dubai, United Arab Emirates, February 13,2020.

Electricity pylons in front of industrial chimneys Dubai, United Arab Emirates, February 13,2020.

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The consortium behind Dubai Waste Management Company has secured a project finance for its mega renewable electricity project.

Belgian construction giant Besix, who is a member of DWMC, said that the special purpose vehicle set up for developing one of the world's largest waste-to-energy (WTE) plants in Dubai, has entered into long-term financing agreements for a total amount of $900 million with major institutional lenders.

The WTE plant, located at the former Warsan landfill site, will process 1.9 million tonnes of municipal waste per year and produce approximately 200 megawatts of renewable electricity.

Apart from Besix, other members of DWMC include Dubai Holding, DUBAL Holding, Itochu, Hitachi Zosen Inova, and Tech Group, according to Besix's press statement.

The loan agreements were signed with Japan Bank for International Cooperation (JBIC) and private financial institutions including Société Générale Bank, KfW IPEX Bank, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation, Mizuho Bank, Siemens Bank, and Crédit Agricole Bank.

It said Nippon Export and Investment Insurance (NEXI) would provide the insurance for part of the loan.

According to the statement, the Build-Own-Operate-Transfer (BOOT) agreement with Dubai Municipality includes the design and construction of the facilities and financing and a 35-year operation and maintenance (O&M) period.

Dawoud Al Hajri, Director General of Dubai Municipality, said: "The strategic focus of this project is to achieve environmental protection, reduce carbon emissions, divert waste from the landfills, and contribute towards the realisation of Dubai's strategy to shift towards clean energy. Dubai Municipality is setting up an attractive environment for investors to support increased foreign direct investment."

The construction, carried out by Hitachi Zosen Inova and BESIX, started in 2020 and is expected to be completed in 2024.

Pierre Sironval, Chief Operating Officer of BESIX Group, said: "BESIX is involved in the project in three ways: the investment, construction, and operations of the plant for 35 years. We have started construction and look forward to delivering and then operating, together with Hitachi Zosen Inova and in close collaboration with Dubai Municipality, this world-leading facility."

The facility will consist of five processing lines, which will be delivered in 2023 and 2024. At the peak of the works, 2,500 workers will be deployed.

The statement said the WTE plant would contribute towards Dubai Clean Energy Strategy 2050 and Dubai Plan 2021 that aim to transform Dubai into one of the most sustainable cities in the world.

In a separate statement, Dubai Holding said the facility will have the capacity to process up to 45 percent of Dubai’s current municipal waste generation, in turn significantly minimising the volume of municipal waste in landfill.

(Writing by Anoop Menon; Editing by Seban Scaria)

(anoop.menon@refinitiv.com)

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