Taqa plans floating sukuks to raise capital

Abu Dhabi: Abu Dhabi National Energy Company PJSC (Taqa) is planning to raise the value of its assets from $14 billion to $20 billion within 12 months, according to a top company official.

The company plans to diversify its borrowing be resorting to Islamic instruments, in addition to its original plan of issuing a medium term note (MTN).

"We are planning to raise up to $9 billion in 12 months, of which $1.5 billion to $3 billion will be through the Islamic sukuk market," Peter Barker Homek, Taqa's chief executive, told Gulf News yesterday.

The sukuks will target the Middle East and North Africa region, including the Gulf Cooperation Countries (GCC), while the announced $10 billion euro medium term note (EMTN) programme will be altered to accommodate for the new Islamic approach.

The move comes in line with the company's target to increase its assets to $40 billion to $60 billion up to the year 2012, according to Homek.

The company, which provides 80 per cent of Abu Dhabi's power and water needs, is seeking projects in other countries in the region including Saudi Arabia, Egypt, Libya, and Algeria. "We have four programmes for Saudi Arabia to provide 4000 megawatts of power, and we will announce the details within 60 days," he added, adding that the company is mainly targeting power generation for the new economic cities in the kingdom, in addition to power for aluminum production.

Plans

With over $12 billion in power generation assets, in addition to $1.4 billion and $450 million in up-stream and mid-stream production, Taqa is seeking to expand its up-stream assets through acquisition of LNG facilities in the region.

"We may move into LNG up-stream production this year, including an LNG terminal in the region.... we are targeting projects in Egypt, Libya, and Algeria this year," he added.

Taqa does not have any plans to finance its expansion plans through increasing its capital, nor is it considering any investments out of the region or Europe.

"Our strategy is to maintain operations within a three-hour time zone from our offices in Europe and the UAE," he said.

It recently announced a joint venture in India with a prominent Indian partner, IL&FS, to develop plants generating 10,000 megawatts of power.