Append Announcement from Rabigh Refining and Petrochemical Company (Petro Rabigh) Regarding the Start of Terminating the Services of Rabigh Arabian Water & Electricity Company (RAWEC)

01-01-2014
29-02-1435
10:40:02

With reference to the announcement of Petro Rabigh on September 18th, 2013 regarding the start of terminating the services of Rabigh Arabian Water & Electricity Company (RAWEC), Petro Rabigh announces that yesterday, Tuesday, December 31st, 2013 it reached a preliminary agreement for a comprehensive settlement with Rabigh Arabian Water & Electricity Company (RAWEC), the main supplier of power and utilities for the Company. The settlement agreement includes a financial package of more than 1 billion Saudi Riyals which RAWEC is committed to fund, and which is distributed as follows: 750 million Saudi Riyals in cash upon signing the final agreement, 190 million Saudi Riyals as reduction in the value of future rate throughout the remaining period of the concession contract of Build, Operate and Own (BOO), and approximately 250 million Saudi Riyals as capital investment to improve the reliability of the utilities supply network.

Until the execution of the final settlement agreement, Petro Rabigh, under this preliminary agreement, will suspend for 3 months the previous notification that was sent to RAWEC on Wednesday, September 18th, 2013 where Petro Rabigh expressed its desire to terminate the agreement of power and water supplies with RAWEC. However, this preliminary agreement provides a promising opportunity to settle this issue for the interest of both parties.

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