Emirate of Dubai, the United Arab Emirates / NEXI to Provide Loan Insurance for Warsan Waste-to-Energy Project
Nippon Export and Investment Insurance
Nippon Export and Investment Insurance (“NEXI”) has decided to provide insurance for a loan facility to Dubai Waste Management Company P.S.C. (hereinafter “the project company”), formed by ITOCHU Corporation (“ITOCHU”), Hitachi Zosen Corporation (“Hitachi Zosen”), Dubai Holding Commercial Operations Group LLC, Dubal Holding LLC, N.V. BESIX S.A. and Tech Group Dubai, for a waste-to energy project in Dubai, the United Arab Emirates.
This is the first waste-to-energy project in Dubai, and it is the first time for NEXI to provide insurance for such project.
The project, under a 35-year concession period with Dubai Municipality, aims to build and operate a waste-to-energy plant in the Warsan area to treat 1.9 million tonnes of solid waste annually.
From a variety of perspectives including Japanese companies’ involvement in plant operation/management, the global expansion of renewable energy, effective use of Japanese public financial institutions and utilization of Japanese expertise in waste treatment, the project is in line with the Infrastructure Systems Overseas Promotion Strategy 2025, which was decided by the Japanese government at the 49th Overseas Infrastructure Development Meeting held in December 2020.
Considering environmental and renewable energy-related businesses as one of its key areas, ITOCHU, one of the project sponsors, is globally developing its projects that contribute to urban development and reduction of greenhouse gas emissions. It has been focusing especially on waste management from an early stage as an environment-conserving business contributing to the sustainable development of our society. Leveraging its accumulated expertise, ITOCHU will take a leading role in the project through a variety of tasks including personnel dispatch to the project company.
Considering environmental and renewable energy-related businesses as one of its key areas, ITOCHU, one of the project sponsors, is globally developing its projects that contribute to urban development and reduction of greenhouse gas emissions. It has been focusing especially on waste management from an early stage as an environment-conserving business contributing to the sustainable development of our society. Leveraging its accumulated expertise, ITOCHU will take a leading role in the project through a variety of tasks including personnel dispatch to the project company.
The project is co-financed by Japan Bank for International Cooperation, Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, Standard Chartered Bank, Société Générale, Crédit Agricole Corporate and Investment Bank, KfW-IPEX Bank and Siemens Bank. Of the co-financing amount, NEXI will cover the USD 380 million loan facility provided by the private financial institutions.
This project has been developed taking full advantage of Japanese latest technologies and in-depth knowledge. It is expected to be part of “Partnership for Quality Infrastructure” promoted by the Japanese government.
In line with the UN Sustainable Development Goals (SDGs), the facility will contribute to reaching the goals set by Dubai Municipality in minimizing the volume of municipal waste in landfills and developing alternative energy sources as well as contribute to sustainable and ecologically friendly waste management in the Emirate and the targets outlined in the Dubai Clean Energy Strategy 2050.
Financial assistance from NEXI for the project is expected to contribute to Japanese companies’ further business expansion in the Middle East, with their excellent environmental technologies, and consequently to Dubai’s social/economic development.
Having a great potential in the area of renewable energy generation system and energy decarbonization, the project can be also considered as a part of efforts toward the promotion of the LEAD initiative launched by NEXI at the end of 2020. And for the purposes of the project, which are environmental protection and climate change measures, it is applicable to NEXI Loan insurance for Green Innovation1.
Through the LEAD initiative, we will continue to support Japanese companies’ overseas expansion while promoting the proactive contribution of Japan toward carbon neutrality.
| Direction of financing | Dubai Waste Management Company P.S.C. |
| Insured | Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation, Standard Chartered Bank, Société Générale, Crédit Agricole Corporate and Investment Bank |
| Insured value | USD 380 million |
| Tenor | 25 years |
| Covered risk | Political risks: 100%, Credit risk: 90% |
Contact:
Power Group, Structure and Trade Finance Insurance Department
Tel: 03-3512-7340
- 1 For details of Loan insurance for Green Innovation, please refer to the NEXI news on July 30, 2019.