Local banks seal Qatari project financing

Published: September 27, 2013

Qatar Electricity and Water Company gets US$450mn in conventional and Islamic tranches for desalination plant.

The Qatar Electricity and Water Company (QEWC) has signed a US$450mn funding package to back its new desalination plant.

The company secured the funds from a consortium of four banks: QNB Group, Barwa Bank, Masraf Al Rayan and Qatar Islamic Bank.

QNB Group acted as conventional mandated lead arranger and provided a US$162mn debt tranche, an US$18mn standby facility and conventional interest rate hedging.

Barwa Bank, Masraf Al Rayan and Qatar Islamic Bank acted as Islamic mandated lead arrangers and each provided US$90mn under an Islamic facility tranche totalling US$270mn.

Announcing the deal, QEWC business development manager Khalid Jolo noted that it is the first Qatari project financing in which a Qatari developer, Qatari offtaker and Qatari banks have worked together without the support of any foreign lenders.

The 36mn-gallons-per-day RAF A2 plant is under construction at the Ras Abu Fontas site and is expected to start operation in June 2015. It should account for 10% of Qatari national water production.