Al Dur closes $1.3bn refinancing facility

Al Dur Power & Water Company announced yesterday the successful closure of a USD 1.3 billion refinancing facility provided by a syndicate of 20 banks including local, regional and international banks. A celebration was held on the occasion in the presence of Shaikh Mohammed bin Khalifa Al Khalifa, the Minister of Oil, Cecile Longe, the French Ambassadress to Bahrain, a representative from the German Ambassador to Bahrain and representatives from the Company, shareholders, financing banks and other key stakeholders.

The refinancing facilities extend up to 14 years and include USD 450 million of conventional facilities and USD 850 million of Islamic facilities. The new financing replaces the one originally provided in 2009, which amounted to USD 1.6 billion. “This is another landmark achievement for 2018 in Bahrain,” said Shafic Ali, Chairman of Al Dur. Al Dur accounts for one-third of the country’s power and water production with a combined capacity of 1,234 MW of power and 48 MIGD of water. The right to develop, finance and operate the project was awarded in 2008 by the Electricity and Water Authority (EWA) of Bahrain to a consortium consisting of Engie and Gulf Investment Corporation.

Other shareholders including the Social Security Organisation, Bahrain Islamic Bank, Capital Management House, First Energy Bank, and Bunya Infrastructure Fund joined in 2009. The Company benefits from a 25-year power and water purchase agreement entered into with EWA. Commercial operations started in early 2012 and the plant was officially inaugurated in April 2012 by His Majesty King Hamad bin Isa Al Khalifa and the Prime Minister HRH Prince Khalifa bin Salman Al Khalifa. The original financing won the “2009 Deal of the Year Award” from Project Finance magazine and praise from various sources for being the first project finance deal to close after the onslaught of the 2008 financial crisis.

Similarly, the new financing has also won an award as the “2018 Refinancing Deal of the Year”. This is an award that Al Dur shares with its sister company Al Ezzel Power Company, which also undertook a successful refinancing in 2018 and is owned by Engie, Gulf Investment Corporation and the Social Insurance Organisation. “This was a challenging transaction implemented in a volatile market environment,” said Cedric Girod, Head of Acquisitions, Investments and Financial Advisory at ENGIE Middle East, South & Central Asia and Turkey. “This success demonstrates the strong support of Bahrain, Saudi and regional and international banks for a strategic asset of the Bahrain economy and for its lead sponsors ENGIE and Gulf Investment Corporation.”