A Joint Venture (JV) established earlier this year by Singapore’s Sembcorp Utilities, a subsidiary of Sembcorp Industries and China’s Jinko Power, has secured approval for its share capital to be listed on the Third Market of the Muscat Stock Exchange (MSE).
According to a statement published by MSE on its website, the JV has been issued a license with a share capital of $1.3 million comprising 500,000 shares by the Oman’s Ministry of Commerce, Industry, and Investment Promotion.
The Oman bourse’s Third Market is a platform that enables small and emerging companies to publicly trade their shares with less stringent regulations compared to companies listed on the primary stock exchange.
The Jinko-Sembcorp JV was selected to develop the 500 MW Manah 2 solar power project in Oman under a build-own-operate model last March. The JV, which is 80% owned by Sembcorp Utilities and the remaining 20% by Jinko Power, also signed a 20-year power purchase agreement with Nama Power and Water Procurement company, which is known as Oman’s Power and Water Procurement Company (OPWP) and is expected to be operational by 2025.
This project is expected to be financed through a mix of internal cash resources and external bank borrowings. It is not expected to have a material impact on the earnings per share, net asset value per share and leverage of Sembcorp for the financial year ending 31 December 2023.
The contract was made official in May, at the same time Nama selected Korea Western Power and French EDF Renewables for its Manah 1 solar plant. The project marks Sembcorp’s first direct foray into MENA’s renewables sector.
Besides Manah 2 solar project, Sembcorp owns 40% of the Salalah Independent Water and Power Plant, one of the most energy-efficient power and water plants in the Dhofar region in Oman.
OPWP is focusing to expand its power generation capacities through solar and wind independent power projects (IPPs).
Oman’s RE Strategy
As part of its plans, Oman’s government adopted a fuel diversification policy few years ago and one of the objectives its National Energy Strategy is that renewable energy projects should contribute at least 10% of electricity generation output by 2025 and 30% from renewable energy projects.
It may be recalled that Oman’s Authority for Public Services Regulation (APSR) granted its approval to OPWP to award Manah I and Manah II solar power projects to the international investors. The two projects, with power generation capacity of 500MW for each, will be located in Manah in Dakhiliyah Governorate. The total cost of the two projects is expected to be more than $800 million.