Arab News, Saturday, May 20, 2023 | Shawwal 30, 1444
ACWA Power signs deals worth over $120m with Uzbek energy companies
Saudi Arabia:
ACWA Power Co. has inked agreements valued at over $120 million for energy
projects in Uzbekistan in what is a further strengthening of bilateral energy
relations between Saudi Arabia and the Central Asian country.
The Saudi company has signed a hydrogen purchase
deal with Uzkimyosanoat, the state-owned chemical entity, and a power purchase
contract with the National Electric Grid of Uzbekistan, according to a press
release.
The deal with Uzkimyosanoat will focus
on decarbonizing the sector through green hydrogen projects, with construction
being executed in two phases.
The second set of agreements involves the signing
of financing documents for Karatau wind farm, formerly referred to as the Nukus
Wind Project, with a total investment value of $120 million.
The National Electric Grid of Uzbekistan will
serve as the exclusive buyer of electricity generated by the project for 25
years.
The Uzbek Ministry of Economy and Finance has
provided support for the project, and funding has been secured through Deutsche
Investitions, the European Bank for Reconstruction and Development, and
Proparco.
Marco Arcelli, CEO of ACWA Power, expressed his
enthusiasm for the Uzbek government's commitment to decarbonisation and
investments in energy diversification.
“We enable sustainable growth of communities
around the world by providing competitive power and water desalination
solutions, and in green hydrogen, we are the first mover in the industry with
our participation in the Neom Green Hydrogen Project with Air Products and
NEOM,” he said.
“Our team has done a magnificent job to launch our
second project in Uzbekistan together with Uzkimyosanoat and the Uzbek
government to make the chemical industry in Uzbekistan a world leader in
decarbonisation. Moreover, the financial close of the Karatau wind project with
the support of EBRD, DEG, Proparco and the Ministries of Energy and Investment,
Industry & Trade of Uzbekistan is a key milestone in the installation of about
5,000 megawatts of capacity in the country by ACWA Power, which will reduce CO2
emissions by over 6 million tons by 2030,” Arcelli added.
The hydrogen and power contracts will span 15 and
25 years, respectively, encompassing project development, construction, and
operation.
These contracts are projected to financially
impact once the project achieves commercial operations, targeted for December
2024.
Timur Mukhammedjanov, chairman of Uzkimyosanoat,
said: “We are excited about the limitless possibilities this agreement brings,
positioning UKS as a key player in the emerging Green fertilizers economy. It is
a testament to our commitment to innovation, environmental stewardship, and
building a prosperous, low-carbon future for our citizens and the world.”
ACWA Power currently has over five active projects
in Uzbekistan, including four wind projects and a combined gas cycle turbine
facility, with the country being the firm's second most valuable market after
Saudi Arabia.
“Uzbekistan has emerged as one of the most
exciting growth countries for ACWA Power in recent years and is our biggest
investment geography outside of the Kingdom. We are proud that our giga scale
development experience in green hydrogen is making us the preferred choice of
partners across the world,” Mohammad Abunayyan, chairman of ACWA Power, said in
January.
The firm operates in 12 countries, with total
investments worth $74.8 billion and 72 assets.
Furthermore, in the first quarter of 2023, the
company reported a consolidated net profit of SR270 million ($71.9 million), a
78 percent rise compared to the same period the previous year.