Saudi Arabia's Marafiq and partners secure $280m to build sewage plant in Jeddah

The project, known as Jeddah Airport 2 ISTP, was awarded under the build, own, operate and transfer model

Ships docked in Jeddah Islamic Port. Marafiq and a consortium of companies secured financing for a project in Jeddah. (Salah Malkawi/ The National)

Saudi Water Partnership Company and a consortium including Marafiq, Veolia and Amwal Khaleejiah secured financing worth $280 million (Dh1.03 billion) to build a sewage treatment plant in Jeddah.

The project, Jeddah Airport 2 ISTP, is being developed through a public-private partnership agreement between Saudi Water Partnership and the consortium, which will build, own and operate the facility under a 25-year deal, Marafiq said in a statement on Sunday, before transferring it back to the public sector.

Funding has been structured as non-recourse project finance, sourced from a combination of senior project finance loans by the National Commercial Bank and equity contributions from shareholders, it added.

"The successful financial closing of Jeddah Airport 2 ISTP, shows the robustness and the efficiency of private-public-partnerships and we expect to see more of these type of projects as part of the Vision 2030," SWPC's chief ececutive, Khaled Al-Qureshi said.

The consortium has also established an entity called the Jeddah Althaniya Water company, which will be responsible for the plant's operation. Once the first phase of construction is complete by the end of January 2023, it will treat 300,000 cubic metres of water per day. Stage two might add another 200,000 cubic metres per day, if the plant exceeds specific utilisation rates.

"All the principles of the circular economy will be put in place, allowing the reduction of sludge and enhancing the beneficial reuse of recycled water for irrigation or industrial use," said Sébastien Chauvin, chief executive of Veolia.

Marafiq, which is also known as Power and Water Utility Company for Jubail and Yanbu, is owned by the the Royal Commission for Jubal and Yanbu, the Public Investment Fund, Saudi Aramco and Sabic.