ABN AMRO completes several firsts for the region with Barka II IWPP and Al Rusail Privatization

Represented by the Electricity Holding Company S.A.O.C. (EHC) and Oman Power and Water Procurement Company S.A.O.C. (PWP), the Government of the Sultanate of Oman has awarded the development of the Barka 2 IWPP and 100% of the shares in Al-Rusail Power Plant to a consortium led by Suez-Tractebel S.A., including Mubadala Development Corporation (from the Emirate of Abu Dhabi) and National Trading Company LLC (from the Sultanate of Oman). ABN AMRO acted as the financial advisor and leader of the consortium of advisors advising the government through PWP, composed of legal adviser Berwin Leighton and Paisner and technical adviser Black and Veatch.

The project sets a milestone for government privatisations in the public utilities sector. It marks the first transaction to be undertaken in Oman after the electricity and related water sector was unbundled in May 2005 following the promulgation of a new sector law and the establishment of a regulatory framework: This is also a first in combining the development of a "Greenfield" IWPP project with a geographically separate "brownfield" project.

As part of the deal, the Suez-Tractebel-led consortium will also acquire the entire share in Al-Rusail Power from the Government of the Sultanate of Oman through the EHC. This marks the first ever privatization by way of a 100% share sale of a power asset awarded to a foreign investor in the Middle East.

Colin Macdonald, ABN AMRO's Country Executive UAE and Regional Head Middle East said:

"We are pleased to have successfully executed this transaction and are committed to support our growing business in Oman and the Middle East. The advisory work was carried out by the dedicated ABN AMRO Structured Loans and Advisory (SLA) Group based in the region and brings our product knowledge closer to our clients enabling us to develop and deliver more innovative solutions."

The project has also set a model for Oman and the region; the evaluation methodology developed for the project is the first of its kind in the Middle East. In addition to giving consideration to the value of the unit cost of electricity and water, the Government and its advisers developed a methodology that also attributes a value to the benefits of the plant configuration on the overall electricity and related water requirements in Oman.

Mohammed Al-Mahrouqi, CEO of Oman PWP and Bob Whitelaw, CEO of EHC said "We have all worked together in achieving the best deal possible for Oman and the full commitment and support of our advisers has been very valuable to the successful conclusion of the Barka 2 IWPP Project and the Al-Rusail Privatization."

The IWPP at Barka will be implemented by SMN Barka Power Company S.A.O.C. in two phases: an early power phase during which 363 MW will become available from the end of April 2008 and a full commercial operation phase during which 668 MW will become available together with 26.4 MIGD of desalinated water. In addition, SMN Power Holding Company will acquire the shares in Al-Rusail Power Company S.A.O.C. Al-Rusail Power Company S.A.O.C. owns a power station with a capacity of approximately 668 MW that was developed in several phases between 1984 and 2004.

ABN AMRO also led the advisory work for the government of Oman through PWP for the IWPP projects of Al Kamil, Barka 1 and the Salalah Privatization of Concession.