In this connection, Mubadala and Dubal are set to sign a 25-year deal with EGA worth over AED1bn ($272.25m).
EGA is an aluminum company, which is jointly owned by Mubadala and Dubal.
Mubadala aerospace, renewables and ICT CEO Khaled Al Qubaisi said: “This project creates an attractive opportunity for Mubadala to add to its portfolio of investments in power generation and utilities in the United Arab Emirates and internationally.
“For EGA, structuring this project on the Independent Power Producer model provides certainty on power prices for decades ahead whilst preserving capital for other opportunities.”
In addition to the power plant, Mubadala and Dubal will also develop a reverse osmosis water desalination plant at the Jebel Ali location as part of the agreement.
EGA managing director and CEO Abdulla Kalban said: “This deal will enable EGA to further improve energy efficiency, saving natural resources and reducing the costs and environmental emissions associated with our aluminum production.
“Bringing in our shareholders to invest in such power facilities through a new company makes sense for EGA from a capital allocation perspective as we expand our core business upstream and internationally.”
The new facilities are expected to enhance the efficiency of power for EGA’s aluminum smelting, thereby helping in cutting down environmental emissions and natural gas consumption.
EGA plans to buy the power plant’s output for 25 years upon its commissioning from a joint venture company to be created by Mubadala and Dubal.
According to the aluminum company, once the project is completed, five older, smaller and less efficient turbines at the Jebel Ali location will be put on standby for use in cases of emergencies.
The company expects the new power facility to decrease greenhouse gas emissions from its power generation at Jebel Ali by nearly 10%. The reductions in emissions per ton of aluminum produced at Jebel Ali, which includes power generation and aluminum smelting, are likely to be up to 7%, said EGA.
Siemens has agreed to deliver its combined cycle H-class gas turbine for the project.
EGA needs power for aluminum smelting and other industrial operations and currently operates captive power plants of a combined capacity of 5.45GW at its Jebel Ali and Al Taweelah sites.
