oil and gas

GS Inima reaches $138m financial closure for Oman desal plant

July 26, 2022

GS Inima, a global leader in the water sector, said it has reached financial closure of Barka V desalination plant - a major utility project being developed by Oman Power and Water Procurement - for €135 million ($138 million).

The plant, located 58 km west of the capital Muscat, has a total capacity of 100,000 cu m/day and will supply drinking water to a population of 800,000 people, said a statement from the utility major.

GS Inima has obtained financing for 100% of the project's needs by signing a 22-year non-recourse loan under the Project Finance modality and a bridge loan to finance the project's equity (Equity Bridge Loan).

Both international and local financial entities have intervened in long-term financing. The majority share is held by Korea Export-Import Bank (Kexim) followed by Bank Muscat and Standard Chartered Bank. For its part, the Equity Bridge Loan (EBL) has been financed by KEB Hana Bank London for a term of 3 years.

Additionally, through the local bank Ahli Bank, a line destined to finance the VAT of the project has been obtained, which has been an important milestone since this tax has been established very recently in Oman and therefore there were no experiences in this type of financing.

The project is being implemented by Oman Power and Water Procurement on a BOO (build, own, operate) contract basis for an operation period of 20 years.

On the successful closure, Diego de Vera, Business Development Director at GS Inima, said: 'It is an honour for us to collaborate with world-class financial institutions to make the Barka V desalination plant project viable, which will contribute to the protection of the region's water resources and provide a new source of drinking water.'

'Together with Ghubrah III, which will be the largest IWP in the country, we will continue to contribute to the increase and improvement of water infrastructure in Oman,' he stated.

Finance Director Manuel Becerra said the financial closure of Barka V represents an important achievement for the company, as it occurred in a scenario of high uncertainty and volatility in the financial markets caused by the pandemic and later the war situation in Ukraine.

'This result would not have been possible without the joint efforts of our client OPWP, the financing entities and GS Inima. Barka V reaffirms the Company's position as a project financing partner for our clients and increases our recurring revenue base that will support GS Inima's future growth,' he added.

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