Pennsylvania-based Air Products along with ACWA Power and NEOM Company have finalized and signed an $8.5bn financing agreement for a green hydrogen project in Saudi Arabia.
To be funded by a combination of long-term debt and equity, the project JV, NEOM Green Hydrogen Project, will build 4 GW of renewables powering production of up to 600 tons per day of hydrogen.
The total financing consists of $5.852bn of senior debt and $475m of mezzanine debt facilities, both arranged on a non-recourse project finance basis, as follows:
– $1,500 million from National Development Fund (NDF) on behalf of National Infrastructure Fund (NIF), under foundation.
– $1,250 million is in the form of SAR denominated financing from Saudi Industrial Development Fund (SIDF),
The balance is from a consortium of financiers, structured as a combination of long term uncovered tranches and a Euler Hermes covered tranche, comprising, in no particular order, First Abu Dhabi Bank, HSBC, Standard Chartered Bank, Mitsubishi UFJ Financial Group, BNP Paribas, Abu Dhabi Commercial Bank, Natixis, Saudi British Bank, Sumitomo Mitsui Banking Corporation, Saudi National Bank, KFW, Riyad Bank, Norinchukin Bank, Mizuho Bank, Banque Saudi Fransi, Alinma Bank, APICORP, JP Morgan, DZ Bank, Korea Development Bank and Credit Agricole.
Air Products, which is the sole offtaker for the project, recently disclosed that the cost of the facility has climbed to $8.5bn compared to an original capital estimate of $5bn.
