(Sukuk.net - Khaleej Times) Saudi Electricity Co.(SEC), the kingdom's largest power generator, agreed to a 6 billion riyal ($1.6 billion) Islamic loan with a group of six local banks to refinance maturing debt and help pay for new projects.

The Riyadh-based company will repay its Murabahah loan over 12 years, it said in a filing to the Saudi stock exchange yesterday, without disclosing the profit rate that will be paid.

Al Rajhi Bank, Banque Saudi Fransi, National Commercial Bank, Samba Financial Group, Saudi british Bank and Saudi Hollandi Bank provided the loan.

State-controlled Saudi Electricity will spend about $24 billion by 2011 to meet soaring domestic demand for power, Moody's Investors Service said in a report last month. The kingdom's power usage may quadruple to 140 gigawatts a year by 2032 as the population grows and oil wealth spurs industrial development, according to forecasts from the King Fahd University of Petroleum and Minerals.

Saudi Electricity spent 13.5 billion riyals on expansion projects last year, according to today's statement, and sold 5 billion riyals of Islamic bonds to pay outstanding bank loans.

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