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Bahrain-based First Energy Bank (FEB), the world's first Islamic investment bank focused exclusively on the energy sector, has acquired a nine per cent stake in the Al Dur Independent Water and Power Production (IWPP) project, the largest of its kind in Bahrain.
With a total investment of $50 million (BD18.85 million), FEB becomes a significant shareholder in the project.
The Al Dur project, which is located on the southeast coast of the kingdom and is valued at $2.2 billion, is on track to meet completion dates and be fully operational in the summer of 2011. It will produce 1,234 megawatts of power and 48 million gallons of water when operational.
This project represents an important addition to Bahrain and will help meet the rising demand for both power and electricity going forward.
Deputy CEO and chief investment & business development officer Mohamed Ghanem said: "Representing a solution to the rising demand of both water and electricity in the kingdom, the Al Dur water and power production project is a prime example of the nature and scope of investment we are looking for.
"With an investment of $50 million, we are one of five new Bahrain-based shareholders to enter into the project, and are very excited about the opportunity."
Both Gulf Investment Company (GIC) and GDF Suez were awarded the project last year. Under a 25-year power and water purchase agreement, the project will provide both electricity and water to the Electricity and Water Authority (EWA) beginning in the summer of 2010.
The project is composed of a Combined Cycle Gas Turbine power plant and a reverse osmosis (RO) technology desalination plant.
FEB has also recently invested $15 million with Mumtalakat, Bahrain's sovereign wealth fund, to refinance three Airbus A330 aircraft for gulf Air, the kingdom's national carrier. The funding came from a $140 million syndicated Ijara facility provided by FEB.
Vahan Zanoyan, CEO of FEB, said in relation to the two investment moves: "We are committed to further developing both the energy sector and the Kingdom of Bahrain. Strategically important projects and opportunities such as the Al Dur IWPP and the Mumtalakat investment bring significant benefits to the bank and our stakeholders."
