SEC to Award Rabigh Contracts, Launch Sukuk

April 27, 2010 – As announced Monday, Saudi Electricity Company (SEC) will receive a $4 billion (SR15 billion) loan from the Saudi Government over the next two years. SEC plans to use this loan to award contracts for a 2,400 megwatt power plant in Rabigh. The plant is expected to be completed in the summer of 2014, with the contracts being awarded in the coming weeks. South Korea’s Doosan Heavy Industries and Construction, Hyundai Heavy Industries, and France’s Alstom are current bidders on the project.

SEC also plans to sell Islamic bonds, or sukuk, next month to raise $1.87 billion (SR7 billion) to finance its expansion plans. Saudi Arabia expects SEC to invest $80 billion (SR300 billion) over the next 10 years to add 20,000 megawatts of power to the current generation capacity. The issuance of sukuk, which was approved by the Capital Market Authority, will be SEC’s third after it raised $1.87 billion (SR7 billion) in 2009 and in 2007. HSBC Holdings PLC and Samba Financial Group will manage the sukuk sale.

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