TRSDC signs first JV worth $400m with Al Mutlaq Group

Under the agreement, the two companies will develop the Jumeirah Red Sea, a 159-key luxury resort situated on The Red Sea destination’s hub island, Shura, currently under construction and expected to open in early 2024. 
Under the agreement, the two companies will develop the Jumeirah Red Sea, a 159-key luxury resort situated on The Red Sea destination’s hub island, Shura, currently under construction and expected to open in early 2024. 
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Updated 01 August 2022

TRSDC signs first JV worth $400m with Al Mutlaq Group

TRSDC signs first JV worth $400m with Al Mutlaq Group

RIYADH: The Red Sea Development Co. has signed a joint venture agreement worth SR1.5 billion ($400 million) with Almutlaq Real Estate Investment Co., a subsidiary of the Al Mutlaq Group. 

Under the agreement, the two companies will develop the Jumeirah Red Sea, a 159-key luxury resort situated on The Red Sea destination’s hub island, Shura, currently under construction and expected to open in early 2024. 

The island forms part of the first phase of development, and will comprise 12 luxury, premium and lifestyle hotels and resorts, residential units, a championship golf course, 118 berth marina, and a comprehensive retail, dining, and entertainment offering.

The strategic partnership marks the first JV established by TRSDC.

“This joint venture investment reinforces the private sector’s alignment with our commitment to regenerative tourism and sustainable development. Our project naturally lends itself to promising business opportunities, with the ability to leverage the Kingdom’s key strategic assets, and drive economic growth and diversification as outlined by Vision 2030,” said John Pagano, CEO of TRSDC. 

“We are extremely pleased to partner with TRSDC and its best-in-class management team on this exciting and compelling project. We have been studying the giga-projects for some time, and the Red Sea is achieving its vision. The destination is coming to life, and we look forward to welcoming our first guests in 2024,” said Tariq Almutlaq, chairman of AREIC.

Investors’ interest

TRSDC is in discussions with several other investors under a similar framework to invest in The Red Sea Project’s commercial assets, including hotels and resorts, leisure, and retail and dining experiences. Moreover, AMAALA and additional soon-to-be-announced projects in the developer’s expanding portfolio bring with them additional opportunities for investors.

“We are attracting an abundance of third-party investment interest, particularly those focused on ESG who are confident that this is an exciting opportunity and one that they do not want to miss out on,” said Jay Rosen, chief financial officer at TRSDC.

Green financing

The announcement follows TRSDC achieving financial close on its SR14.120 billion ($3.76 billion) green financing earlier this year with four leading Saudi banks (Banque Saudi Fransi, Riyad Bank, Saudi British Bank, and Saudi National Bank). As the first-ever riyal denominated green financing, TRSDC was acknowledged with an award for Project Finance Deal of Year in the Capital Markets Saudi Arabia Awards 2021 plus the Best New Green Loan Financing Project Award at the International Finance Awards 2022.

The Red Sea Project has demonstrated significant progress on the ground, with Phase-1 now more than 50 percent complete and several key assets already fully operational, including a four-star management hotel, on-site offices, and the largest landscape nursery in the region.

TRSDC and AMAALA have awarded over 1,000 contracts worth in excess of SR25 billion. Work is on track to welcome the first guests in early 2023, when the first hotels will open, with the balance of phase one set to complete by early 2024.


Saudi Electricity secures $568m funding for interconnection project with Egypt

Saudi Electricity secures $568m funding for interconnection project with Egypt
Updated 14 sec ago

Saudi Electricity secures $568m funding for interconnection project with Egypt

Saudi Electricity secures $568m funding for interconnection project with Egypt

RIYADH: State-owned Saudi Electricity Co. has obtained $568 million in financing to fund the Saudi-Egypt electricity interconnection project.

The Fund, which has a term of 14 years, is backed by Swedish Export Credit Corporation, Standard Chartered Bank, and Sumitomo Mitsui Banking Corp., according to a bourse filing.

Saudi Arabia and Egypt signed an agreement to establish an electrical interconnection in 2012 for the purpose of being the main axis in the Arab electrical linkage, which aims to create an infrastructure for electricity trade between Arab countries.

In October of last year, the two countries signed contracts for a $1.8 billion electricity interconnection project to ensure an exchange of 3,000 MW of electricity between both nations.

In a separate announcement, the utility firm announced that it has also obtained a syndicated loan of $3 billion from a number of international banks.

As part of the five-year syndicated loan, the company will refinance an existing international syndicated facility. This will include, without limitation, capital expenditures.

The financing entities include Standard Chartered Bank, HSBC Bank, Intesa Sanpaolo, Mizuho Bank, MUFG Bank, Sumitomo Mitsui Banking Corporation, Industrial and Commercial Bank of China, and State Bank of India.

Following the announcement, shares of SEC opened Thursday's trading session 0.39 higher percent at SR26.

Established in 1999, Saudi Electricity produces electricity through 45 power plants and owns transmission and distribution networks throughout the Kingdom.

It is majority-owned by the government at 74.3 percent, while Saudi Aramco owns 6.9 percent.

In the last earnings report by the firm, it reported a 10 percent decline in profit to SR1.5 billion for the first quarter of 2022.


MG sells over 120,000 cars since its debut in Mideast

MG sells over 120,000 cars since its debut in Mideast
Updated 11 min 8 sec ago

MG sells over 120,000 cars since its debut in Mideast

MG sells over 120,000 cars since its debut in Mideast

RIYADH: British automotive company MG has sold over 120,000 cars in the Middle East alone since its debut in the region in 2014, according to a press release.

The company claimed that it is currently ranked sixth in the list of manufacturers in the region.

Meanwhile, MG also exported its one-millionth vehicle since it started overseas sales following its acquisition by SAIC Motor in 2007.

Tom Lee, managing director of MG, said: “This latest milestone illustrates the commitment MG has to its customers, both globally and regionally, ranging from the support provided by our Advanced Design Studio in London, our extended support team in headquarters to that delivered by our dedicated partners across the Middle East.”

It further noted that MG is ranked among the top 10 brands in 18 countries including Saudi Arabia, New Zealand and Australia. 


Oil demand rises as gas prices surge: IEA

Oil demand rises as gas prices surge: IEA
Updated 17 min 39 sec ago

Oil demand rises as gas prices surge: IEA

Oil demand rises as gas prices surge: IEA

PARIS: Global oil demand will rise more than previously forecast this year as heatwaves and soaring gas prices are prompting countries to switch fuels for power generation, the International Energy Agency said Thursday, according to AFP.

Oil prices have dropped by $30 per barrel from a peak in June due to growing supplies and “escalating concerns over the deteriorating economic outlook,” the Paris-based agency said in a monthly report.

Meanwhile, prices of natural gas and electricity have jumped to new records, prompting some countries to switch to oil use, the IEA said.

“With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and the Middle East but also across Asia,” the agency said.

“Fuel switching is also taking place in European industry, including refining,” said the IEA, which advises developed countries on energy policy.

Consequently, the IEA raised its demand forecast by 380,000 barrels per day.

Demand is now seen rising by 2.1 million bpd to a total of 99.7 million bpd in 2022. It will reach 101.8 million bpd in 2023, exceeding pre-Covid levels.

The IEA said European oil deliveries are being boosted by “exceptional demand” for heat and power generation and in industry.

The report comes as a EU plan to cut gas consumption across the 27-nation bloc by 15 percent came into effect on Tuesday.

The effort is aimed at coping with the energy price crisis spurred by Russia’s war in Ukraine.

EU countries also fear Russia may cut gas supplies during winter in retaliation to Western sanctions over the war.

The IEA said the heatwaves and “the beginning of what may be a major rise in gas-to-oil switching under new EU guidelines in response to uncertainty surrounding gas supply from Russia are augmenting fuel oil and gasoil use.”


NEOM's subsidiary plans district cooling plant in OXAGON

NEOM's subsidiary plans district cooling plant in OXAGON
Updated 38 min 47 sec ago

NEOM's subsidiary plans district cooling plant in OXAGON

NEOM's subsidiary plans district cooling plant in OXAGON

RIYADH: ENOWA, NEOM’s subsidiary energy, water and hydrogen, plans to build a district cooling plant at OXAGON.

It is set to issue a request for proposals for the contract by November, reported MEED.
The planned cooling plant will have a capacity of 25,000 refrigeration tons. 

It will be connected to the district cooling network, which will be built separately, according to MEED. 

Earlier in June, ENOWA announced a partnership with Japan-headquartered Itochu and France’s Veolia to develop a desalination plant powered by renewable energy in OXAGON.

The new plant has a design capacity of 500,000 cubic meters and is expected to produce water as early as 2024.

The project is scheduled to become commercially operational in 2025 and is expected to meet around 30 percent of the total projected water demand in NEOM once completed.

In addition to using 100 percent renewable energy, the proposed plant will use membrane technology to produce separate brine streams.


Saudi PIF supported Lucid during times of supply crunch, says top official 

Saudi PIF supported Lucid during times of supply crunch, says top official 
Updated 45 min 14 sec ago

Saudi PIF supported Lucid during times of supply crunch, says top official 

Saudi PIF supported Lucid during times of supply crunch, says top official 

RIYADH: Saudi Arabia’s Public Investment Fund has been supportive of Lucid Group Inc. during times when the firm faced a supply crunch which led to two production target cuts, said a top official. 

Earlier this month, Lucid cut its production targets to 6,000 to 7,000 cars from an original target of 20,000 cars due to supply chain issues. 

Faisal Sultan, managing director of global operations at Lucid, said that PIF — which owns over 60 percent share in the electric car manufacturing firm — understands the challenges around supply chain issues and costs. 

“The PIF have been very supportive. When the world re-emerges from the pandemic and the supply chain catches up, we will be ready,” Sultan told Bloomberg TV. 

Sultan, however, noted that supply chain issues will be solved soon, and conditions will improve by the end of this year. 

“We’re a new company, so definitely there will be challenges in the next three-four months, but we’re hoping things will get better by the end of this year,” he added. 

In the first quarter of 2022, Lucid sold 360 cars to Saudi Arabian customers, and in April alone, 300 cars were delivered in the Kingdom. 

Lucid has inked a deal with Saudi Arabia to deliver 100,000 cars over the next decade, as the Kingdom continues its focus to achieve a sustainable future. 

Sultan noted that Lucid has huge opportunities in the Kingdom. 

“The government is very serious and they’ve been working very hard with us to make sure the environment is ready,” added Sultan.

On May 18, Lucid signed an agreement to build a production factory in King Abdullah Economic City, the western part of the Kingdom, with an annual capacity of 150,000 zero-emission electric vehicles.