The Red Sea Wind Energy consortium has achieved financial close for its 500MW Gulf of Suez wind farm project located near Ras Ghareb
The Red Sea Wind Energy consortium reached financial close for its 500MW Gulf of Suez wind farm project near Ras Ghareb, on 3 April.
The project will be executed in two phases and connected to the grid by the third quarter of 2025. The consortium will operate and maintain the plant under a 25-year power-purchase agreement (PPA) with the Egyptian Electricity Transmission Company (EETC). Egypt’s Ministry of Finance is backing the EETC’s obligations under the PPA.
The wind farm will be built, owned and operated by Red Sea Wind Energy, a consortium of ENGIE with a 35% stake, Orascom Construction, which holds 25%, Toyota Tsusho Corporation with 20%, and Eurus Energy Holdings Corporation with 20 per cent.
Orascom Construction will execute the construction of the civil and electrical works of the wind farm.
This project is expected to provide clean power to over 800,000 homes in Egypt, accelerate the country’s transition to renewable power generation, and reduce CO2 emissions by approximately 1 million tonnes annually.
The project is also part of the energy pillar of the Nexus of Water-Food-Energy (NWFE) programme, an initiative presented by the Egyptian government at Cop27 in November 2022 that is expected to contribute towards the energy transition.
Non-recourse project financing is provided by the Japan Bank for International Cooperation (JBIC), in coordination with Sumitomo Mitsui Banking Corporation, the Norinchukin Bank, Societe Generale and the European Bank for Reconstruction and Development (EBRD), under a Nippon Export and Investment Insurance (NEXI) cover. HSBC Bank Egypt is acting as the working capital bank and onshore security agent.
This project is a significant milestone for the consortium as it triples its wind energy capacity in Egypt to 762.5MW.
Additionally, it marks the first co-financing between JBIC and EBRD since the signing of a memorandum of understanding (MOU) in October 2022 and the first joint project between NEXI and EBRD since an MOU in October 2020.
Mohamed Hussein, Managing Director of ENGIE Renewable Energy at AMEA and Regional Director for South Africa, said that this partnership is a repeat of the same partnerships it made with the 262.5 MW Ras Ghareb wind power plant for the Gulf of Suez 2 which, once completed in 2025, will be one of the world’s largest wind farms of ENGIE.
Khaled El-Degwi, head of the infrastructure investment sector of Orascom Construction, said that this project is part of the company’s cooperation with the Egyptian Electricity Transmission Company and the New and Renewable Energy Authority.
He added that this project represents the joint efforts of the Alliance and a strong group of international financial institutions, export credit agencies, commercial banks and the Ministry of Electricity and Renewable Energy to present an important project that helps accelerate the transformation of the renewable energy sector in Egypt.
