Economic Impact Report
Jazan / Southern Region — Phase Initial · Registry: registry-jazan-v1
State A sourced from Feedstock Study (seven-stream Jazan profile, FWDC SAR 260/ton ESTIMATED — lowest in KSA programme). State B from Proposal. Inherited warnings: WARN-01 (FWDC), WARN-02 (feedstock volume), WARN-03 (Nitaqat), WARN-08 (V₂O₅ IGCC ash and petcoke ash).
Seven streams. Two first-of-kind nationally: IGCC ash from ACWA Power's 2,400 MW gasification complex (distinct from combustion petcoke ash — higher metal concentration, slag chemistry) and agricultural biochar from Saudi Arabia's only subtropical crop corridor. Both gaps — waste diversion and critical minerals — closed simultaneously at zero Authority capital, with a net surplus from Year 2 onward. Phase Initial: 100 TPD · 1 module · $55M Carbotura FDI.
Decision Summary
Option A-IC (IGCC ash V₂O₅ — Aramco Jizan off-take) is conditional on WARN-08 engineering confirmation. IGCC ash must be characterized separately from combustion petcoke ash before V₂O₅ volumes are included in any client figure. Base case does not require critical minerals confirmation.
| Parameter | State A — Current System | State B — Option A (ACM) |
|---|---|---|
| Disposal cost trajectory | SAR 260/ton FWDC — lowest in KSA programme. MWAN tightening will erode this advantage; no incumbent advanced processor exists in Southern Region | Processing Service (Ijarah) — Year 1 net outflow; 2.5%/yr contractual escalator |
| IGCC ash (ACWA Power) | Slag and fly ash disposal liability — first-of-kind in KSA with no designated processor | V₂O₅ + Ni + Fe manufacturing inputs — closed industrial loop from ACWA Power's 2,400 MW gasification complex WARN-08 |
| Agricultural biomass | Crop residues and processing waste — no thermal treatment pathway in Southern Region | Biochar RC3 from subtropical agricultural waste — unique nationally |
| Capital obligation | Ongoing disposal spend — no asset created | Zero LOCKED |
| Year 2+ net | Disposal cost escalating — MWAN enforcement removes low-cost disposal options | Revenue Share exceeds Processing Service — net surplus |
| Critical minerals | IGCC slag vanadium continues to be landfilled — no processor in Southern Region | V₂O₅ from IGCC and petcoke ash WARN-08 |
| MWAN contribution | None | 70,000 tpy full programme toward 2035 |
| Employment | No new in-Kingdom FTE | 94 direct FTE full programme + 282 indirect ESTIMATED — Nitaqat-labeled |
- MWAN 2035 compliance window for Jazan shortens — Southern Region has the fewest alternative processors nationally
- IGCC ash continues as an unresolved disposal liability with no processor — ACWA Power bears cost with no recovery pathway
- Forfeits one full year of Revenue Share at full programme scale
- Agricultural biochar production delayed against Ma'aden soil remediation and Vision 2030 green infrastructure programmes
State A — Current System Baseline
Seven-Stream Disposal Cost All ESTIMATED — WARN-01
- SIRC subsidiary residuals (MSW, C&D, ASR): SAR 140–200/ton
- IGCC ash (ACWA Power gasification complex): SAR 200–300/ton — first-of-kind industrial waste classification, no standard disposal pathway
- Petcoke / combustion ash: SAR 180–280/ton — industrial waste designation
- Agricultural biomass: SAR 100–160/ton — seasonal, no incumbent processor
- Wastewater sludge: SAR 120–180/ton
- Blended FWDC: SAR 260/ton · $69.33/ton — lowest in KSA programme ESTIMATED ⚠ WARN-01
Why Jazan has the lowest FWDC in the programme: Southern Region industrial volumes are lower than the Eastern Province or Riyadh corridors. RCJY Jazan landfill gate rates reflect lower throughput demand. This structural advantage will narrow as MWAN enforcement increases and as the IGCC and steel complex scales to full output — at which point the disposal capacity constraint becomes acute with no alternative processor available.
State A Cost Trajectory — FWDC at 2.5%/yr from SAR 260/ton (base)
State A Structural Position: IGCC slag vanadium — the only first-of-kind industrial gasification ash stream in Saudi Arabia — continues to be landfilled with no recovery pathway. Saudi Arabia imports vanadium for the 110 GW VRFB storage programme. Agricultural biomass — unique in the Kingdom's subtropical climate zone — continues to decompose with no thermal processing. The Southern Region's distinctive feedstock profile produces no manufactured output and no MWAN compliance contribution in State A.
State B — Deployment Baseline
Phase Initial: 100 TPD, 1 module, RCJY Jazan IC Phase II (Manufacturing Site Deed: RCJY · CSA: Saudi Investment Recycling Company (SIRC) — two independent agreements).
| Term | Phase Initial | Full Programme | Status |
|---|---|---|---|
| Capacity | 100 TPD · 1 module | 200 TPD · 2 modules | LOCKED |
| Annual volume | 35,000 tpy | 70,000 tpy | LOCKED |
| Carbotura FDI | $55M (SAR 206.25M) | $110M (SAR 412.50M) | LOCKED |
| Revenue Share lag | 13 months rolling | ALWAYS | |
| T0 | Q2 2029 | ESTIMATED | |
| Phase Initial COD | Q4 2031 | ESTIMATED | |
| First Revenue Share | ~Q1 2033 | DERIVED | |
| IGCC ash stream | Separate ACWA Power feedstock agreement required — independent of SIRC CSA | WARN-08 prerequisite | |
Dual-Counterparty Structure — Jazan: RCJY (Royal Commission for Jubail and Yanbu — Jazan zone) is the Manufacturing Site Deed counterparty. Saudi Investment Recycling Company (SIRC) is the CSA counterparty. These are two independent agreements with two independent entities. IGCC ash from ACWA Power requires a third, separate feedstock agreement. Carbotura designs, finances, builds, owns, and operates — zero Authority capital.
Delta Analysis
Year 1: Processing Service paid. Zero Revenue Share. 13-month pre-royalty period. Year 2+: Revenue Share exceeds Processing Service — net surplus. FWDC is the Authority's current disposal cost — the net Year 2+ surplus position is independent of FWDC and does not change if FWDC is higher or lower than estimated.
FWDC Sensitivity
The net Year 2+ surplus is contractually fixed. FWDC only affects the gross cost displacement calculation in Year 1. The surplus does not change regardless of where actual FWDC lands.
| FWDC | Year 1 gross displacement (Phase Initial) | Net Year 2+ surplus |
|---|---|---|
| SAR 200/ton | SAR 7,000,000/yr ESTIMATED | Net surplus LOCKED |
| SAR 260/ton (base) | SAR 9,100,000/yr ESTIMATED | Net surplus LOCKED |
| SAR 340/ton | SAR 11,900,000/yr ESTIMATED | Net surplus LOCKED |
Critical Minerals Delta (Option A-IC — ESTIMATED — WARN-08)
This section is conditional on WARN-08 engineering confirmation and ICO buyer LOI. Not incorporated into Option A base case. IGCC ash analysis and petcoke ash analysis must be completed separately before any V₂O₅ volumes are quoted in client documents.
IGCC Ash — First-of-Kind V₂O₅ Source (ACWA Power)
The ACWA Power 2,400 MW integrated gasification combined cycle (IGCC) complex at Jazan is the first facility of its kind in Saudi Arabia. IGCC gasification is fundamentally distinct from combustion:
- Combustion petcoke ash: Oxidative combustion — vanadium distributes across fly ash at lower concentration
- IGCC gasification slag: Partial oxidation at high temperature and pressure — metals (vanadium, nickel, iron) concentrate in gasification slag at potentially higher recoverable concentrations
- Exact V₂O₅ concentration in Jazan IGCC slag requires dedicated characterization — engineering confirmation (WARN-08) required before any quantity or value is stated
The ACWA Power–Aramco Jizan Loop: Aramco supplies feedstock to the ACWA Power IGCC complex. IGCC generates vanadium-bearing slag. Carbotura recovers V₂O₅ from that slag. V₂O₅ feeds into Aramco Jizan's VRFB supply chain for regional renewable energy storage. PIF holds a strategic stake in ACWA Power, making ACWA Power both a feedstock originator and an aligned stakeholder in the critical minerals recovery pathway.
Conditional Minerals Output Table All TBD — WARN-08
| Product | Stream | Volume | Buyer (CANDIDATE) |
|---|---|---|---|
| Vanadium Pentoxide V₂O₅ | IGCC gasification slag | TBD — requires IGCC slag analysis | Aramco Jizan / VRFB supply chain WARN-08 |
| Vanadium Pentoxide V₂O₅ | Combustion petcoke ash | TBD — requires petcoke ash analysis | Aramco Jizan / VRFB supply chain WARN-08 |
| Nickel | IGCC slag + petcoke ash | TBD — co-concentrated with vanadium | Industrial metals buyers |
| Iron / Steel | IGCC slag | Confirmed present — volume TBD | Jazan IC steel sector |
Agricultural Biochar — Unique Nationally
Saudi Arabia's only subtropical agricultural zone (Tihamah coastal plain, Aseer highlands) generates crop residues and processing waste that no other region in the Kingdom produces at commercial scale:
- Mango, banana, papaya crop residues — thermal conversion to Biochar RC3
- Coffee processing waste (Jazan is Saudi Arabia's primary coffee-growing region) — high-carbon organic input
- Estimated 700 tpy Biochar output (Phase Initial, ESTIMATED)
- Biochar applications: soil carbon sequestration (Vision 2030 green infrastructure), agricultural amendment (Aseer highland terraces), carbon credit generation
No-Fallback: Critical Minerals Dimension — In State A, the IGCC ash stream — the first industrial-scale gasification ash produced in Saudi Arabia — continues to accumulate as a disposal liability with no V₂O₅ recovery pathway. Saudi Arabia imports vanadium for the 110 GW VRFB programme. Agricultural biochar is not produced. The Southern Region's unique feedstock profile generates zero manufactured output.
System-Level Impact
Employment ESTIMATED — Nitaqat-labeled
| Phase | Direct FTE | Indirect FTE | National Content (IKTVA proxy) |
|---|---|---|---|
| Phase Initial (1 module) | 47 | 141 | 62% ESTIMATED |
| Full Programme (2 modules) | 94 | 282 | 62% ESTIMATED |
Direct FTE subject to Nitaqat compliance. In-Kingdom Saudization tier confirmed at Feasibility Study with HRSD. IKTVA proxy is estimated — formal IKTVA assessment required at CSA execution.
Environmental Delta
| Metric | State A | State B — Phase Initial | Full Programme |
|---|---|---|---|
| Diversion from landfill | ~0% of addressable | ~100% Phase Initial volume | ~100% full programme volume |
| Annual volume diverted | ~10% of addressable | 35,000 tpy | 70,000 tpy |
| Carbon avoidance | 0 | 266,450 tCO₂e/yr ESTIMATED | 266,450 tCO₂e/yr ESTIMATED |
| SGI contribution | None | 266,450 tCO₂e/yr toward Saudi Green Initiative | 266,450 tCO₂e/yr |
| MWAN compliance | None | 35,000 tpy toward 2035 | 70,000 tpy |
| Agricultural biochar | None produced | ~350 tpy RC3 ESTIMATED | ~700 tpy RC3 ESTIMATED |
Regional Economic Impact ESTIMATED
- $110M Carbotura FDI into Southern Region — foreign direct investment from UK-based manufacturer
- 94 direct skilled manufacturing FTE (full programme) — no equivalent employer in Jazan IC currently
- IKTVA contribution: in-Kingdom manufacturing qualifies for IKTVA credit for Aramco and industrial buyers
- Agricultural biochar supply chain: value creation from Tihamah coastal and Aseer highland crop waste
- First critical minerals recovery facility in Southern Saudi Arabia
Risk & Sensitivity
| # | Risk | Mitigation |
|---|---|---|
| 1 | FWDC lower than SAR 260/ton | Net Year 2+ surplus is INDEPENDENT of FWDC — Revenue Share exceeds Processing Service regardless of disposal cost level |
| 2 | IGCC ash V₂O₅ concentration below commercial threshold | WARN-08 — engineering confirmation required. Base case does not include V₂O₅ volumes. Bottom ash and petcoke streams remain fully viable without IGCC. |
| 3 | IGCC ash characterized as hazardous | Routes through GEMS hazardous operating license. Carbotura processes through licensed pathway — does not affect base-case non-hazardous streams. |
| 4 | Agricultural biomass seasonality and volume variation | Seasonal blending protocol — ACM designs for P90 surge. Off-season: other streams fill capacity. Agricultural stream is additive, not base-case. |
| 5 | ACWA Power IGCC feedstock agreement timeline | IGCC agreement is independent of SIRC CSA. Phase Initial can commence on non-IGCC streams while IGCC characterization and agreement proceed in parallel. |
| 6 | Aramco Jizan V₂O₅ buyer LOI timing | WARN-05 — Option A base case does not require V₂O₅ LOI. A-IC is additive election. Resolve WARN-08 first, then LOI pathway. |
| 7 | Nitaqat compliance in lower-population Southern Region | WARN-03 — Feasibility Study with HRSD resolves tier. Southern Region Saudization requirements confirmed at that stage. |
| 8 | RCJY Jazan site allocation timeline | RCJY Business Center engagement initiated at T0 in parallel with CSA execution. Site agreement is independent of CSA. |
Net Effects Summary — Option A
| Dimension | State A | State B Phase Initial | State B Full Programme |
|---|---|---|---|
| Fiscal position | ~SAR 9.1M/yr disposal cost (ESTIMATED) | Year 1: Processing Service outflow. Year 2+: net surplus | Net surplus scales with module count |
| 30-year cumulative State A | ~SAR 398M ESTIMATED | Converted to manufactured output and Revenue Share | |
| Critical minerals | None — landfilled | V₂O₅ + Ni + Fe from IGCC/petcoke ash (WARN-08) · Biochar RC3 from agricultural waste | |
| MWAN compliance | None | 35,000 tpy | 70,000 tpy toward 2035 |
| Carbotura FDI | None | $55M (SAR 206.25M) | $110M (SAR 412.50M) |