ACWA Power seeks financing for solar and wind projects

Updated 23 October 2014
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ACWA Power seeks financing for solar and wind projects

ALKHOBAR: Saudi Arabia-based power and water project developer ACWA Power is seeking to secure or arranging finance for $15 billion worth of projects, nearly half of which are in renewable energy, its CEO said.
The company, which plans to list its shares on the Saudi stock market, has projects operating or under construction in countries including Saudi Arabia, Jordan, Oman, Turkey, Morocco and some African and southeast Asian states.
“This network of countries is starting to move toward renewables fast,” Paddy Padmanathan said in an interview at the Reuters Middle East Investment Summit.
“Morocco is clearly leading, while South Africa is embracing a huge program and is deploying it...Jordan is starting to employ renewables.”
ACWA Power’s plans illustrate a huge business opportunity emerging in the Middle East and North Africa: solar and wind power projects. Countries with big external deficits such as Morocco are pushing them to cut their energy import bills.
Meanwhile, some of the Gulf oil exporters are beginning to turn to them to meet rapidly rising domestic demand for electricity, since oil-fired power stations threaten to eat up a growing share of their oil available for export.
Padmanathan said ACWA Power’s bids under preparation or already submitted, plus projects which had been awarded but were still in the financing stage, totalled $15 billion. Of this, $7.4 billion were in renewable energy.
The company also has $20 billion worth of projects already operating while $4.5 billion are under construction.
In Saudi Arabia, ACWA Power is bidding for a 100 megawatt solar power plant in Makkah and has proposed the lowest electricity tariff, though an award has not yet been made, Padmanathan said.
In 2012 the kingdom, which is the world’s largest oil exporter, announced plans to diversify its energy mix by investing in renewable energy. Little progress has been made so far, but projects such as the Makkah plant may indicate momentum is building.
Roughly 40 percent of Saudi Arabia’s electricity could be provided economically using renewable energy, Padmanathan said.
“There will be renewable energy deployed, no question...I am confident that we will start to see plants starting to be built in 2015, maybe toward the end of 2015.”
He added that the government had decided in principle that no more new oil would be made available for power generation in Saudi Arabia.
Another Gulf country pushing renewables is Oman, which has much more limited oil reserves than its wealthy neighbors and is keen to conserve them. This month Oman announced plans to build what it described as the first major wind farm in the Gulf Cooperation Council, at a cost of $125 million.
ACWA Power has about 18 gigawatts of power capacity worldwide and produces 2.4 million cubic meters per day of desalinated water. It aims for 39 GW and 5 million cubic meters by 2017-2018.
Padmanathan said these targets could be achieved merely by operating in the company’s current markets.
“In terms of our future plans, in terms of geography we donít see any reason for us to step much beyond that...This geography will keep us very much occupied for the next three to five years, simply because our demand is growing across this geography at about 7 or 8 percent.”
The next independent power project in Saudi Arabia will be the Fadhili gas-fired power plant owned by Saudi Aramco and Saudi Electricity Co. Padmanathan said his company was waiting for a request for proposals, and would start working on a bid this year.
In Morocco, it recently proposed the lowest tariff to build the Noor II and Noor III projects, Padmanathan said. Noor II is a 200 MW concentrated solar power plant and Noor III is a 100 MW solar tower project.
The company is also preparing to bid for an 850 MW wind project in Morocco, which it says will be the largest in the world.
In Oman, it bid for a desalinated water project in Qurayyat, which is now under evaluation and expected to begin construction next year. It is preparing to bid with Japan’s Mitsui for Oman’s Salalah II power plant.
Outside the Middle East, ACWA is developing a 1,200 MW coal-fired power plant in Vietnam and looking to start bidding for projects in Indonesia in early 2015. In Mozambique, it is developing a $1 billion coal-fired power plant with a capacity of 300 MW.
ACWA has chosen Banque Saudi Fransi 1050.SE to arrange its flotation on the kingdom’s stock exchange. Padmanathan declined to say when the company aimed to list its shares; he said it currently had enough resources to finance its projects, but would look in the future to tap debt markets, including the Islamic bond market.
The company is owned by two Saudi government bodies — the Public Investment Fund’s Sanabil Direct Investment, and the Public Pension Agency — as well as eight Saudi conglomerates.


Ghosn vows to stay in Japan if granted bail

Updated 10 min 29 sec ago
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Ghosn vows to stay in Japan if granted bail

  • “I am not guilty of the charges against me and I look forward to defending my reputation in the courtroom,” Carlos Ghosn said
  • The Franco-Lebanese-Brazilian executive said he has been in his Tokyo detention cell for 64 days “with no release in sight”

TOKYO: Carlos Ghosn, the ousted Nissan boss detained in Tokyo on charges of financial misconduct, on Monday vowed to remain in Japan if granted bail and again proclaimed his innocence.
The Tokyo District Court will later Monday consider the 64-year-old’s latest petition for bail but has already rejected previous applications, judging Ghosn a flight risk who might seek to destroy evidence.
“As the court considers my bail application, I want to emphasize that I will reside in Japan and respect any and all bail conditions the Court concludes are warranted,” Ghosn said in a statement released by his US-based representatives.
He vowed to attend any subsequent trial “not only because I am legally obligated to do so, but because I am eager to finally have the opportunity to defend myself.”
“I am not guilty of the charges against me and I look forward to defending my reputation in the courtroom,” concluded the statement.
A spokeswoman for Ghosn, Devon Spurgeon, said his family had already rented an apartment in Tokyo where he promised to reside while awaiting trial.
He has also promised to hand over his passports, refrain from contacting people connected with the case and pay for security guards approved by prosecutors to monitor his movements, according to Spurgeon.
She added that Ghosn has also offered a higher bail fee by stumping up Nissan stock as collateral and promised to wear an electronic tracking bracelet paid for by himself.
The Tokyo court has dismissed all previous attempts by Ghosn to secure his freedom and even his lead lawyer has said he is unlikely to be granted bail until a trial takes place — which could take six months.
However, the case has been full of twists and turns that have kept Japan and the business world gripped since his first stunning arrest as he landed in his private jet at Haneda Airport.
The Franco-Lebanese-Brazilian executive said he has been in his Tokyo detention cell for 64 days “with no release in sight.”
Since then, he has only been seen in public once, in a dramatic court appearance where the much thinner executive pleaded his innocence in a packed courtroom.
His wife Carole has appealed to Human Rights Watch, claiming he is being held in “harsh” conditions and subjected to round-the-clock interrogations intended to extract a confession.
Ghosn’s arrest represented a sudden fall from grace for a once-revered tycoon widely credited with turning Nissan around from the verge of bankruptcy.
Nissan immediately ousted him as chairman after the arrest, as did Mitsubishi Motors, the other Japanese firm in the three-way alliance with Renault.
The French firm is expected to meet later this week to discuss removing Ghosn as chairman and CEO. French government officials have already urged the company’s board to pick a “new lasting leadership.”
Late Sunday, Nissan held an inaugural meeting of a special committee designed to improve governance in the wake of the scandal.
The head of the committee, Seiichiro Nishioka, said the problem was “an excessive concentration of authority in the hands of a single person.”
The committee is expected to meet three or four additional times before issued a final report at the end of March.
The charges against Ghosn are that he under-declared his income in official documents to shareholders over an eight-year period — in an apparent bid to dodge accusations he was overpaid.
In addition, prosecutors have formally charged him with involvement in a complex scheme they say was designed to make Nissan pay for personal investment losses sustained in the financial crisis of 2008.
Ghosn’s arrest has thrown into question the future of the auto alliance he forged, which has come under pressure in his absence.
French Economy Minister Bruno Le Maire on Sunday denied talk of a potential merger between Renault and Nissan, despite reports in the Japanese media that Paris was pushing for that outcome.
“The subject is not on the table today. What is on the table today is the governance of Renault,” he told journalists during a visit to Cairo.
“The most important thing for us is to have solid, stable, sustainable governance for Renault.”