Egypt and Siemens sign $9bn powergen deal
Record breaking contract includes 600 wind turbines to generate 2GW.
Egypt has closed a mega deal with German energy giant Siemens that will boost the North African country’s power generation capacity by 50% and make electricity blackouts a thing of the past.
President Abdel Fattah el-Sisi signed contracts in Berlin yesterday worth EUR 8bn ($9bn) to add 16.4GW through a combination of natural gas and wind power plants.
The single biggest order ever received by Siemens expands on the MoUs signed only in March at the Egypt Economic Development Conference in Sharm El Sheikh.
"With these unprecedented contracts, Siemens and its partners are supporting Egypt's economic development by using highly efficient natural gas and renewable technologies to create an affordable, reliable and sustainable energy mix for the country's future," said Joe Kaeser, President and CEO of Siemens.
"The Egyptian people can count on Siemens. This was true more than 150 years ago when Siemens first started working in Egypt, and it remains our commitment today at this historic signing."
Together with local Egyptian partners Elsewedy Electric and Orascom Construction, Siemens will supply on a turnkey basis three natural gas-fired combined cycle power plants, each with a capacity of 4.8GW, for a total combined capacity of 14.4GW.
Each of the three power plants - Beni Suef, Burullus and New Capital - will be powered by eight Siemens H-Class gas turbines, selected for their high output and record-breaking efficiency.
The plants will add power to the grid in stages. Plans call for an initial 4.4GW to go online before summer 2017 and the full 14.4GW to become available 38 months after the financing has closed and advance payments have been received. Once completed, the three power plants will be the largest in the world.
Siemens will also deliver up to 12 wind farms in the Gulf of Suez and West Nile areas, comprising around 600 wind turbines and an installed capacity of 2GW.
The company will build a rotor blade manufacturing facility in Egypt's Ain Soukhna region, which will provide training and employment for up to 1,000 people. The facility is scheduled to go into operation in the second half of 2017.
Siemens' Financial Services Division (SFS) has structured a financing package for Siemens' role in the contracts, including a tailored guarantee concept.
The envisaged loan facilities, supported to a large extent by Export Credit Agency coverage in Germany and Denmark, will be provided by international and regional banks.