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State utility Saudi Electricity Company (SEC) has recently secured two revolving credit facilities worth a combined SR7.75bn ($2.07bn). This comes as both SEC and other Saudi state firms are having to adapt to lower revenues by tapping external funding sources for capacity expansions. Recent sharp rises in the price SEC pays for generation fuels put additional pressure on its already constrained finances.
The latest fundraising efforts will help fund a capital investment program including the completion of power plants with a combined 7GW of capacity during 2016-18.
The loans take SEC’s total outside funding to more than $30bn since it issued its first sukuk in 2007. Since that time, the companies that provide Saudi Arabia’s heavily subsidized energy – SEC and state petroleum firm Saudi Aramco – have raised a total $63bn of funding. SEC – of which the government owns roughly 74% and Aramco 7%, with 19% of its shares traded on the Saudi Stock Exchange (Tadawul) – regularly raises funds through sukuk and bank loans, but also relies on soft loans from the Ministry of Finance. (CONTINUED - 770 WORDS)
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