ACWA Power in $8.5B financing for NEOM green hydrogen project

The NEOM Green Hydrogen Project (NGHP), which is anticipated to be put into service in 2026, has inked financing agreements for a total investment of $8.5 billion with Saudi Arabian utility developer ACWA Power, which is partially owned by the sovereign Public Investment Fund.

The investment was made with NEOM Green Hydrogen Company (NGHC), a joint venture between ACWA Power, Air Products, and NEOM Company, with ACWA Power holding a 33.3% equity stake, the utility said in a statement on Riyadh’s Tadawul exchange on Wednesday. The investment was funded by a combination of long-term debt and equity.

The $5.852 billion in senior debt and $475 million in mezzanine lending facilities that make up the total financing were both negotiated on a non-recourse project finance basis:

  • $1.50 billion from the National Infrastructure Fund (NIF) through the National Development Fund (NDF) (NIF).
  • The Saudi Industrial Development Fund loan totaling $1.25 billion is in Saudi Riyals (SIDF).

The remaining amount is provided by a group of investors, and it is structured as a combination of long-term uncovered tranches and a covered Euler Hermes tranche. There are many financial institutions involved, including First Abu Dhabi Bank, HSBC, Standard Chartered Bank, Mitsubishi UFJ Financial Group, BNP Paribas, Abu Dhabi Commercial Bank, Natixis, Saudi British Bank, Sumitomo Mitsui Banking Corporation, Saudi National Bank, KFW, Riyad Bank, Norinchukin Bank, Mizuho Bank, Banque Saudi Fransi, Alinma Bank, APICORP, JP Morgan, DZ Bank, Korea Development Bank,

Under a 30-year green ammonia offtake agreement with Air Products, NGHP entails the complete setup and operation of a multi-billion-dollar green hydrogen and green ammonia factory in the NEOM region of Saudi Arabia.

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