Air Products’ Saudi Gasification JV Closes new Financing Round

24.01.2023 - Financing for the $12 billion air separation unit gasification/power joint venture between US industrial gases producer Air Products and its Saudi subsidiary Air Products Qudra with Saudi Aramco and ACWA Power has moved forward another notch.

At the beginning of the week, Air Products announced the financial close and transfer of the second group of assets for the project in Jazan Economic City, Saudi Arabia. This follows the successful asset acquisition and financing transactions for the first group, completed in late October 2021.

The gases producer, which has the 50.6% majority interest in the JV, said minor final commissioning items are expected to be completed later this year. The partners are contributing around 40% of the company’s capital structure; the remainder consists of non-recourse project financing.

In 2021, Air Products said that through the Saudi Industrial Development Fund (SIDF) and 23 local and international lenders, $7.2 billion in funding had been secured thus far. Figures for the second round were not disclosed.

The project’s operators have purchased gasification, syngas cleanup, utilities and power assets from Aramco and now run the facility under a 25-year contract. Aramco is supplying feedstock in exchange for the supply of power, steam, hydrogen and other utilities to the oil conglomerate’s Jazan Refinery, which processes 400,000 bbl/d of crude oil.

Seifi Ghasemi, chairman and president and CEO of Air Products, said the world-scale operation is a “perfect fit with our growth strategy and also supports the Kingdom’s Vision 2030.” It will deliver “significant contributions” to the US company’s earnings, he added.

Author: Dede Williams, Freelance Journalist