Red Sea wind farm starts operations
16 April 2025
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The 500MW initial phase of the Gulf of Suez wind farm in Ras Ghareb, Egypt, has started commercial operations six months ahead of schedule, according to the project's developer, Red Sea Wind Energy.
Red Sea Wind Energy is developing the project on a build, own and operate basis. It comprises a consortium of France’s Engie with a 35% stake; the local Orascom Construction, which holds 25%; Japan’s Toyota Tsusho Corporation with 20%; and Eurus Energy Holdings Corporation with 20%.
The completion of the 500MW wind farm phase takes Oracom Construction's renewable energy portfolio to 912.5MW of wind farms, in addition to three water projects in Egypt, the UAE and Saudi Arabia.
The Cairo-based firm is also responsible for executing the engineering, procurement and construction (EPC) work on the balance of the plant, as well as all carrying out civil and electrical works at the Ras Ghareb wind farm.
Red Sea Wind Energy reached financial close on the 150MW expansion of the 500MW Gulf of Suez wind farm project in January this year, at the same time as it announced that the first 306MW of the project had started commercial operations.
The original project has a capacity of 500MW, which reached financial close in early 2023.
The expansion adds another 150MW, with the original lenders together extending a further co-financing totalling $106m, MEED previously reported.
Orascom said the project's 150MW new phase is financed by the same partners that financed the original 500MW project capacity.
Non-recourse project financing is provided by Japan Bank for International Cooperation (JBIC) in coordination with Sumitomo Mitsui Banking Corporation (SMBC), Norinchukin Bank, France's Societe Generale under a Nippon Export & Investment Insurance (Nexi) cover, and the London-based European Bank for Reconstruction & Development (EBRD).
HSBC Bank Egypt acted as the working capital bank and onshore security agent.
JBIC signed a loan agreement of approximately $51m with Red Sea Wind Energy to finance the project, MEED reported in November last year.
JBIC confirmed at the time that the total loan of $106m was co-financed with the other four banks.
It is understood that the 150MW expansion required an additional investment of about $127m.
According to Nexi, it will provide cover for an approximately $35m loan extended by the commercial banks, as well as for the interest rate swap agreement guaranteed by SMBC.
The project company has been developing the 500MW onshore wind farm, which is located in the Ras Ghareb region facing the Red Sea, approximately 200 kilometres southeast of Cairo. It consists of 84 wind turbine generators.
The 150MW expansion of the project entails the addition of a further 20 wind turbine generators.
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 Finance Ministry is backing the EETC’s obligations under the PPA.
This project marked the first co-financing by JBIC and EBRD since the signing of a memorandum of understanding (MoU) in October 2022, and the first joint project by Nexi and EBRD since an MoU in October 2020.
MEED reported in March 2023 that JBIC had signed a loan agreement to finance up to $240m of the project.
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