Saudi Aramco’s $12 Billion Jazan IGCC Project in Saudi Arabia

White & Case and the Law Office of Megren M. Al-Shaalan (LOMAS) have advised the Saudi Arabian Oil Company (Saudi Aramco) on the deal.

Saudi Arabian Oil Company (Saudi Aramco) closed the US$12 billion hybrid acquisition, development and financing of a world-scale Integrated Gasification and Combined Cycle (IGCC) project in the Jazan Economic City, Kingdom of Saudi Arabia.

The transaction is structured around Saudi Aramco’s sale of the world’s largest complex of its kind (comprising of gasification blocks, gas turbine power blocks that will produce up to 3.8 GW of power, an air separation unit and other ancillary assets) to a special-purpose joint venture (JV) entity, for a purchase price of approximately US$12 billion. A partnership of Air Products and ACWA Power holds a majority interest in the JV, with Saudi Aramco retaining a minority interest via its subsidiary, Saudi Aramco Power Company (SAPCO).

The JV secured a US$7.2 billion financing from the Saudi Industrial Development Fund (SIDF) and 23 regional and international lenders, and the first group of IGCC assets has now been transferred from Saudi Aramco to the JV.

The JV will own and operate the assets under a 25-year long-term offtake contract with Saudi Aramco. Saudi Aramco will supply feedstock to the JV, and the JV will produce power, steam, hydrogen and other utilities. These offtake products will primarily serve Saudi Aramco’s adjacent Jazan Refinery Complex – a megaproject that will process 400,000 barrels per day of crude oil to produce products such as ultra-light sulphur diesel and gasoline.

The White & Case and LOMAS team that advised on the transaction was led by partners Antoine Cousin (Picture; Abu Dhabi), Carina Radford (London), Adam Pierson, Ibaad Hakim (both Abu Dhabi) and Ivan Paskal (Dubai) and included partners Megren Al-Shaalan (LOMAS, Riyadh), Jacquelyn MacLennan (Brussels) and Strati Sakellariou-Witt (Brussels), counsel Habeeb Rahman (Abu Dhabi) and associates Joshua Cohen, Sarah Hudson, Fergus Langstaff, Patrick Burrows (all Abu Dhabi), Sara Nehring, Josephine Levick (London) and Waad Alkurini (LOMAS, Riyadh).

Involved fees earner: Megren Al-Shaalan – White & Case; Waad Alkurini – White & Case; Patrick Burrows – White & Case; Joshua Cohen – White & Case; Antoine Cousin – White & Case; Ibaad Hakim – White & Case; Sarah Hudson – White & Case; Fergus Langstaff – White & Case; Josephine Levick – White & Case; Jacquelyn MacLennan – White & Case; Sara Nehring – White & Case; Ivan Paskal – White & Case; Adam Pierson – White & Case; Carina Radford – White & Case; Habeeb Rahman – White & Case; Strati Sakellariou – White & Case;

Law Firms: White & Case;

Clients: Saudi Aramco;