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Acwa Power set to increase capital by SAR 7.1 bn to fund expansions

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WHAT WE’RE TRACKING TODAY

TODAY: Expansion plans for Acwa + Morocco breaks ground on largest desal plant

Good morning, folks. It’s another busy morning of news as the Eid Al Adha break draws nearer, and we have a deluge of updates from across the region hitting nearly every subsector of the business. But first, an update from across the pond…

THE BIG CLIMATE STORY OUTSIDE THE REGION- California to confiscate earnings from Big Oil’s false advertising: California is using a new consumer protection law to force major oil companies — including Exxon Mobil, Chevron, Shell, and BP, ConocoPhillips, and the American Petroleum Institute — to cough up any money made from misleading consumers about their green impacts. This law enables the state to seize any earnings obtained through unfair competition and false advertising.

REMEMBER- California initially filed a lawsuit last year against the oil majors for causing USD bns in economic and environmental damages by misleading the public on the impact long-standing fossil fuel extraction has on the economy and communities. The lawsuit alleges big oil firms and trade groups have known since at least the 1960s that their operations are warming the planet and causing “tens of bns of USD” in damages.

The story grabbed ink in Reuters, The Financial Times, and Bloomberg Law.

ON A RELATED NOTE- The city of Honolulu is also in the midst of a lawsuit against Big Oil for misleading the public for decades about the effects of burning fossil fuels and causing property and infrastructure damage. The Supreme Court’s request for the Biden administration to weigh in on Big Oil’s appeal for the lawsuit to proceed will postpone proceedings. The story made headlines in Reuters and The Guardian.


PSA-

It’s that time of the year again: Emirates Central Cooling Systems Corporation (Empower) has launched its Set at 24°C and Save initiative to reduce district cooling energy consumption during summer, according to a DFM filing (pdf). The campaign — Empower’s 11th in a row — promotes setting air conditioners to 24°C in auto mode for around 136k customers to conserve energy and reduce bills.

WATCH THIS SPACE-

#1- Turkey will impose a 40% additional tariff on Chinese hybrid vehicle imports from July 7, Reuters reports, citing a statement by Turkey’s Ministry of Trade. The decision aims to protect Turkey’s domestic automakers and prevent a deterioration of its current account balance by bolstering domestic production and investment. This measure will apply to both conventional and hybrid passenger vehicles, with a minimum tariff of USD 7k per vehicle.

Turkey already imposed tariffs on EVs: Turkey imposed a 40% customs duty on Chinese electric vehicles in a bid to promote its first locally-produced electric vehicle in March 2023. The government has supported the Automobile Joint Venture Group (Togg) with tax cuts, low borrowing costs, and a purchase pledge of 30k vehicles annually until the end of 2035.

#2- Taqa pulls the plug on Naturgy takeover: Abu Dhabi’s Taqa will not proceed with the acquisition of Spanish gas producer and renewables player Naturgy after halting discussions with two of the utility’s largest shareholders, CVC Capital Partners and Global Infrastructure Partners (GIP), the energy firm said in a statement (pdf).

Taqa also confirmed that it has terminated talks with Criteria Caixa over a potential cooperation agreement to hold a stake in Naturgy.

ICYMI- Criteria Caixa said on Monday that talks with Taqa regarding a joint takeover have fallen through. The two companies were reportedly looking to “cooperate” on a potential acquisition. Criteria Caixa currently owns a 26.7% stake in the company.

BACKGROUND- Taqa disclosed in April that it was in discussions with the three shareholders to potentially acquire their stakes in the Spanish company. The acquisition was expected to meet resistance amid a rising wave of protectionism in the EU, which would have prompted the Spanish government to negotiate maintaining a stake.

#3- Shalfa gets green light for Nomu IPO: Riyadh-based waste management company ShalfaGroup has lined up Capital Market Authority (CMA) approval to debut its shares on Tadawul’s parallel market Nomu, according to a CMA statement. Shalfa is looking to offer a 15% stake in the company to qualified investors.

THE SCORECARD-

KSA + UAE ranked top 10 for sustainable infrastructure: Saudi Arabia and the UAE are the only Middle Eastern countries to have made it into the top 10 global rankings for Leadership in Energy and Environmental Design (LEED) certified projects, according to a report (pdf) by UAE project managing firm Stonehaven. Riyadh is the leading city for LEED projects in Saudi, standing at 866. In the UAE, Dubai took the top spot with 348 LEED projects followed by Ras Al Khaimah with 120 projects. Saudi Arabia has reduced construction and manufacturing emissions by 24% between 2010 and 2020, while the UAE attributes its sustainable construction success to the Al Sa’fat green building rating system, the report wrote.

DANGER ZONE-

Bahrain’s vulnerable groups to be impacted by climate change: Climate change-induced extreme heat, dust storms, flooding, and socioeconomic problems will affect vulnerable groups in Bahrain including migrant workers, health compromised elderly, and farmers, according to a report by the Middle East Institute.

Health + finance burdens will be exacerbated: Outdoor workers — the majority of which are migrants — are especially vulnerable to heat-related illnesses while the elderly are more vulnerable to respiratory issues and health distress from all cases of extreme weather. Farmers will suffer the burden of financial pressures caused by climate change such as the rising costs of water and energy which reduced their crop yield and revenues as water pumping, transmission, and other costs become more expensive. For consumers, it is expected that residential water costs will rise due to scarcity while food insecurity will also increase.

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CIRCLE YOUR CALENDAR-

Spain will host the Connecting Green Hydrogen Europe conference from Tuesday, 25 June to Thursday, 27 June in Madrid. The event will see around 5k attendees including industry leaders, energy ministers, and executives to explore solutions, new technologies, and transformative advancements to advance the hydrogen industry.

Turkey will host the Nuclear Power Plants Summit & Expo from Tuesday, 2 July to Wednesday, 3 July in Istanbul. The event will gather utility companies, independent power producers, government officials, and industry leaders to explore nuclear power projects, plans, products and tech solutions.

Egypt will host the Egypt Mining Forum from Tuesday, 16 July to Wednesday, 17 July in Cairo. The event will convene decision-makers from government, industry experts, new exploration firms, financiers, and investors to explore the challenges and advantages to establish Egypt as a leading global mining hub by 2040.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

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CAPITAL MARKETS

Acwa Power set to increase capital by SAR 7.1 bn to fund expansions

The board of KSA renewables giant Acwa Power has recommended increasing its capital by SAR 7.1 bn through a rights issuance, it said in a disclosure to Tadawul yesterday. The funds will be channeled towards supporting Acwa Power’s growth plans, which aim to triple its assets by 2030.

In numbers: Acwa Power sees spending on its projects between 2025 and the end of the decade surging to USD 2-2.5 bn annually from an earlier range of USD 1-1.3 bn annually, according to the disclosure. “This capital increase will allow Acwa Power to continue to invest in the growth of its portfolio while maintaining a strong financial position,” Acwa Power said.

What’s next: The recommendation is still subject to the approval of regulatory authorities and the general assembly, Acwa Power said. The company also needs to appoint a financial advisor for the issuance and submit the necessary paperwork to the Capital Market Authority.

Market reax: Acwa Power’s fell 8% during intraday trading, but pared back its losses to close down 2.7%. The company is gearing up for the capital increase amid a 570% surge in its share price since its 2021 listing, according to Bloomberg.

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DESALINATION

Morocco begins constructing Africa’s largest desalination plant

Morocco has broken ground on the MAD 6.5 bn (c. USD 650 mn) renewables-powered desalination plant in El Jadida province near Casablanca city, according to Map Express. The plant — set to be the largest in Africa — will provide drinking water and irrigation to communities in Casablanca, Settat, Berrechid, Birr El Jadid, and surrounding areas in an attempt to combat water scarcity after three years of drought in the country.

What we know: The desal plant — located on 50 hectares of land — will have a capacity of 300 mn cbm to provide drinking water for 7.5 mn people. The first phase is expected to be completed by the end of 2026 with a capacity of 548k cbm per day, which will increase to 822k cbm per day by mid-2028. Spanish infrastructure group Acciona is at the helm of the project alongside Acwa Power’s two Moroccan-based subsidiaries Afriquia Gaz and Green of Africa, Atalayar reported last November.

And that’s not all: The facility will also have a MAD 3 bn (c. USD 300 mn) drinking water transportation system with 3 pumping stations, 3 tanks, and a distribution network. The cost of producing drinking water will be MAD 4.48 per cbm.

All part of a bigger plan: The new plant is an effort to combat water insecurity after the country has experienced five years of drought. The project is part of the Development of Water Supply plan that falls under the MAD 143 mn National Program for Drinking and Irrigation Water Supply framework for 2020-2027.

REMEMBER- Water scarcity has been an ongoing problem in Morocco: Water inflows have declined in the country from 2.5k cbm per capita annually in 1960 to 620 cbm in 2020, placing Morocco in a situation of structural water stress. Last year the country approached the absolute water scarcity threshold of 500 cbm per capita per year.

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GREEN FINANCE

Jordan secures USD 30 mn in financing for wastewater management

Jordan’s wastewater treatment gets a financing boost: The European Bank for Reconstruction and Development (EBRD), the UK and the EU will jointly extend USD 30 mn in financing to the Water Authority of Jordan (WAJ) for wastewater management projects, according to a statement. The package will comprise a USD 19 mn loan from EBRD, a USD 8 mn investment grant from the UK’s High Impact Partnership on Climate Action (HIPCA), and a USD 2.95 mn grant from the EU's Neighbourhood Investment Platform.

Where is the money going? The funds are allocated for a new wastewater treatment plant in Jordan’s West Irbid region. The plant will have a capacity of 12k cbm per day and provide sanitation services to the surrounding area.

We knew this was coming: EBRD approved the loan to finance the construction of the treatment plant in March.

Wastewater is an essential source of water supply for the kingdom: Jordan operates 34 wastewater treatment plants that provide 14% of the kingdom’s total water supply. Treated wastewater is also vital for Jordan’s agriculture sector accounting for around a quarter of the volume of water used for irrigation, the statement notes.

Jordan has more plants in the works: A subsidiary of Dubai-based contractor Drake & Scull International is building an AED 307 mn (c. USD 83.6 mn) wastewater treatment plant in Jordan’s Ar-Ramtha city. Jordan signed a JOD 7.6 mn (c. USD 10.7 mn) agreement last year for a treated water carrier project backed by Germany's Development Bank. The project would provide 10 mn cbm of treated water annually and slash greenhouse gas emissions by 6.6k tons annually.

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GREEN MANUFACTURING

Oman breaks ground on USD 68 mn silicon metal factory

Omani silicon manufacturer Green Ferro Alloy has kicked off construction on a USD 68 mn silicon metal factory in Oman's Sohar Port and FreeZone, according to a press release. This plant aims to meet the rising demand for metallic silicon in Asia, Europe, and North America. No timeline for the project has been revealed.

What we know: The factory — which spans 160k sqm — will initially produce 25k tons of high-quality metallic silicon annually, with plans to double production to 50k tons in the second phase, the statement said. The manufacturing process will involve pouring liquid silicon into molds, cooling, grinding, and packing it for export.

What is silicon metal used for? About 95% of solar panels sold currently use silicon semiconductors. Crystalline silicon cells consist of silicon atoms arranged in a crystal lattice, which efficiently converts light into electricity. They offer high efficiency, low cost, and long lifespans.

Plans for the factory were first announced last year: Sohar Port and Freezone and Green Ferro Alloy first inked a land lease agreement to establish the plant back in July 2023.

Sohar is on a roll: Australia’s renewable energy developer United Solar Group began construction on a USD 1.3 bn polysilicon production facility in Oman’s Sohar Port and Freezone back in March.

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RENEWABLES

Belgium’s Jan De Nul + Australia’s Fortescue partner on an North Africa renewable energy exports

Belgian maritime infrastructure firm Jan De Nul and Australia’s Fortescue will partner to lay a subsea cable to export green electrons from North Africa to Europe, according to a statement. The timeline and investment value for the project were not disclosed.

Green electrons, Enterprise? Green electrons are basically energy produced from renewable energy resources, according to Fortescue. Green hydrogen serves as the foundation for green molecules materials such as green ammonia. However, these molecules are only considered green if the carbon is meticulously managed throughout the supply chain and reused.

What they said: “There is a massive opportunity to send renewable electrons from Morocco and North Africa to Europe to industries and consumers…” Fortescue Chairman Andrew Forrest said, adding that Europe will soon begin imposing carbon taxes globally through its Carbon Border Adjustment Mechanism on industries that fail to convert energy supplies to renewable energy.

Fortescue has been preparing the energy: Morocco’s fertilizer giant OCP Group and Fortescue formed a JV in April to develop green hydrogen and ammonia projects in Morocco. The partners will collaborate to supply fertilizers, hydrogen, and ammonia domestically in the kingdom and export to European and global markets. The firm also received nearly EUR 204 mn from the EU to finance its flagship green ammonia plant which will ship surplus green ammonia to domestic and European markets.

And the Morocco-UK interconnection is also underway: UK-based renewables developer Xlinks is currently constructing its interconnection project with Morocco which will comprise a 3.8k km high-voltage direct current subsea cable transporting 3.6 GW of renewable energy — nearly 8% of the UK’s current requirements — from a 10.5 GW solar and wind farm in Morocco’s Guelmim-Oued Noun region to Britain’s power grid in Devon. It will also include a 20 MW battery storage system.

Jan De Nul already has an interconnection agreement with Egypt in the works: The company inked an agreement with Egypt to conduct feasibility studies on the possibility of building a Mediterranean subsea powerline with a capacity of 2 GW to export renewable electricity to Europe.

There are big plans to link North Africa to the EU through Egypt: Italy’s CESI and Prysmian Group, along with the UAE's K&K group, and Germany’s Siemens Energy are carrying out a detailed feasibility study for the development of an electricity interconnection project between Egypt and Italy. Egypt has a planned 3 GW interconnector project with Greece which would see Egypt export its renewables surplus to mainland Greece.

And over in Tunisia…: Italy and Tunisia are already working on a EUR 1 bn electric interconnection project dubbed Elmed. The 600 MW subsea interconnector will transport clean power generated from hydroelectricity and is targeting an operational launch by 2028. Italy is also planning to provide political backing for the Medlink project in a bid to import renewable energy from North Africa to Northern Italy via subsea lines.

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ALSO ON OUR RADAR

UAE’s AGDA partners with G&+, ODI to accelerate climate action in conflict zones

GREEN FINANCE-

AGDA, G7+, ODI launch mechanism for climate action in conflict zones: The AnwarGargash Diplomatic Academy (AGDA), the G7+, and global affairs think tank Overseas Development Institute (ODI) have announced a new coordination mechanism to enhance climate action in fragile and conflict-affected areas, Wam reports. The initiative supports the COP28 Declaration on Climate, Relief, Recovery, and Peace and aims to stimulate climate action and finance for communities facing severe humanitarian challenges by allowing finance providers to tailor programs and finance solutions for these vulnerable areas. AGDA is an autonomous federal diplomatic research and civil service training institute in Abu Dhabi.

REMEMBER- The COP28 Presidency launched the Declaration on Climate, Relief, Recovery and Peace on 3 December. WFP’s Executive Director Cindy McCain and COP28 President Sultan Al Jaber called for urgent action to increase climate action in fragile and conflict-affected areas where “extreme weather events affect three times as many people annually compared to other countries.”

OTHER STORIES WORTH KNOWING ABOUT THIS MORNING-

  • UAE approves digital transformation framework: The UAE cabinet has approved a framework for the government’s sustainable digital transformation as well as a charter setting safety and privacy standards for the use of AI. (Wam)
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AROUND THE WORLD

Yara inaugurates Europe’s largest green hydrogen plant

Norway's fertilizer manufacturer YaraInternational has launched a 24 MW renewable hydrogen and ammonia plant in Herøya, Norway, the largest of its kind in Europe, according to a statement. The facility uses electrolysis of water and renewable energy as feedstock instead of natural gas, cutting around 41k tonnes of CO2 emissions annually. The first batch of low-carbon footprint fertilizer, produced using green ammonia from the plant, has been delivered to the Swedish agricultural cooperative Lantmännen.

A green hydrogen bonanza: The company signed an agreement with Green Hydrogen and Chemicals Company (GHC) — a subsidiary of Indian renewable energy company Acme Cleantech — to buy 100k tons of green ammonia annually from its Oman plant in March. It also signed a term sheet with AM Green's green ammonia production division Greenko ZeroC for the supply of green ammonia from India.


Bill Gates’ energy company TerraPower has broken ground on a USD 4 bn nuclear power plant in Wyoming, the tech mogul wrote in a blog post. The plant is pending approval from the Nuclear Regulatory Commission for commercial use after applying in March. Half of the funding will come from the US Department of Energy.

The details: The plant will use 345 MW sodium-cooled fast reactors as opposed to traditional water-cooled reactors that can generate up to 500 MW at their peak and provide energy to 400k homes. The launch of the plant was delayed by two years to 2030 because the reactors that will be used rely on high-assay low-enriched uranium that is only commercially supplied by Russia. The US Energy Department is now working on developing the fuel itself.

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ON YOUR WAY OUT

Researchers develop wood satellite for sustainable space exploration

Kyoto University researchers and Japan’s Sumitomo Forestry have developed the world’s first wooden satellite in a bid to make space exploration more sustainable, Nature reports. The satellite, dubbed LignoSat, is made from magnolia-wood panels using traditional Japanese wood-joinery techniques which require no glue or metal fittings. The satellite will be launched into orbit from the International Space Station in November after being transferred there in September.

How does it work? LignoSat, which measures approximately 10 cm in length, is equipped with an aluminum frame, solar panels, circuit boards, and sensors. It aims to address the growing concern about space debris in orbit — which can threaten spacecraft and space stations — by ensuring complete incineration upon re-entry into Earth's atmosphere, releasing only water vapor and carbon dioxide.

Big plans ahead: The satellite's mission is to assess the feasibility of using wooden satellites, and includes evaluating the strain on the wood, temperature, geomagnetic forces, and cosmic radiation, as well as testing its ability to receive and transmit radio signals. The project, which began in 2020, will also help determine the feasibility of using wood to construct shelters on the moon and Mars, leveraging wood's natural radiation-shielding properties and thermal insulation capabilities.

But it still has its challenges: While wood offers several advantages for space use, including not blocking radio waves and being resilient in space's harsh environment, concerns remain regarding its structural integrity and longevity in space. Experts also question how wood will fare against galactic cosmic radiation and its potential impact on mechanical properties over time.


JUNE 2024

10-12 June (Monday-Wednesday): The International Conference on European Energy Market, Istanbul, Turkey.

11-12 June (Tuesday-Wednesday): International Conference on Financing Investment and Trade in Africa, Tunis, Tunisia.

11-13 June (Tuesday-Thursday): Morocco Energy Week Summit, Marrakesh, Morocco.

18-19 June (Tuesday-Wednesday): Biofuels International Conference & Expo, Brussels, Belgium.

18-19 June (Tuesday-Wednesday): Sustainable Aviation Fuels Summit, Brussels, Belgium.

25-27 June (Tuesday-Thursday): Connecting Green Hydrogen Europe, Madrid, Spain.

26-27 June (Wednesday-Thursday): Decarbonizing Shipping Forum, Rotterdam, Netherlands.

JULY 2024

2-3 July (Tuesday-Wednesday): Nuclear Power Plants Summit & Expo, Istanbul, Turkey.

12-14 July (Friday-Sunday): G20 Leaders Summit, Rio de Janeiro, Brazil.

16-17 July (Tuesday-Wednesday): The Egypt Mining Forum, Cairo, Egypt.

AUGUST 2024

1 August (Thursday): Distributed Solar Summit, Dubai, UAE.

12-16 August (Monday-Friday): Mastering Renewable & Alternative Energies, Dubai, UAE.

20-21 August (Tuesday-Wednesday): The World ESG Summit, Dubai, UAE.

24-26 August (Saturday-Monday): International Conference on Clean and Green Energy Engineering, Izmir, Turkey.

24-26 August (Saturday-Monday): International Summit on Non-Renewable and Renewable Energy, Valencia, Spain.

SEPTEMBER 2024

16-18 September (Monday-Wednesday): World Utilities Congress, Abu Dhabi, UAE.

17-19 September (Tuesday-Thursday): EV Auto Show, Riyadh, Saudi Arabia.

OCTOBER 2024

1-3 October (Tuesday-Thursday): Water, Energy and Environment Technology Exhibition, Dubai, UAE.

13-17 October (Sunday-Thursday): Cairo Water Week, Cairo, Egypt.

15-17 October (Tuesday-Thursday): EV Auto Show, Riyadh, Saudi Arabia.

NOVEMBER 2024

4-8 November (Monday-Friday): World Urban Forum, Cairo, Egypt.

4-8 November (Monday-Friday): AfricanEnergy Week, Cape Town, South Africa.

11-22 November (Monday-Friday) United Nations Climate Change Conference or Conference of the Parties (COP29), Baku, Azerbaijan.

11-14 November (Monday-Thursday): Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC), Abu Dhabi, UAE.

18-19 November (Monday-Tuesday): G20 Summit, Rio de Janeiro, Brazil.

26-28 November (Tuesday-Thursday): Saudi Electricity Expo, Riyadh, Saudi Arabia.

26-28 November (Tuesday-Thursday): Egypt Energy Show, Cairo, Egypt.

27-28 November (Wednesday-Thursday): RAK Energy Summit, Ras Al Khaimah, UAE.

DECEMBER 2024

2-13 December (Monday-Friday): Conference of the Parties (COP16) to the United Nation Convention to Combat Desertification, Riyadh, Saudi Arabia.

JANUARY 2025

14-16 January (Tuesday-Thursday): World Energy Summit, Abu Dhabi. UAE.

28-29 January (Tuesday-Wednesday): Sustainability Forum Middle East, Riyadh, Saudi Arabia.

FEBRUARY 2025

24-26 February (Monday-Wednesday): Connecting Hydrogen MENA, Dubai, UAE.

EVENTS WITH NO SET DATE

2024

End-2024: Emirati Masdar’s 500 MW wind farm in Uzbekistan to begin commercial operations.

QatarEnergy’s industrial cities solar power project will start electricity production.

November: 9th Arab Forum for Renewable Energy and Energy Efficiency, Amman, Jordan.

2025

International Union for Conservation of Nature World Conservation Congress, Abu Dhabi, UAE.

UAE to have over 1k EV charging stations installed.

Middle East Electric Vehicle Show, Sharjah, UAE.

2026

26-29 October (Monday-Thursday): World Energy Congress, Riyadh, Saudi Arabia.

UITP Global Public Transport Summit, Dubai, UAE.

Annual Meetings of the World Bank and the International Monetary Fund, Bangkok, Thailand.

1Q 2026: QatarEnergy’s USD 1 bn blue ammonia plant to be completed.

End-2026: HSBC Bahrain to eliminate single-use PVC plastic cards.

2027

MENA’s district cooling market is expected to reach USD 15 bn.

World Water Forum, Riyadh, Saudi Arabia.

2030

UAE’s Abu Dhabi Commercial Bank (ADCB) wants to provide AED 35 bn in green financing.

UAE targets 14 GW in clean energy capacity.

Tunisia targets 30% of renewables in its energy mix.

Qatar wants to generate USD 17 bn from its circular economy, creating 9k-19k jobs.

Morocco’s Xlinks solar and wind energy project to generate 10.5 GW of energy.

2035

Qatar to capture up to 11 mn tons of CO2 annually.

2045

Qatar’s Public Works Authority’s (Ashghal) USD 1.5 bn sewage treatment facility to reach 600k cm/d capacity.

2050

Tunisia’s carbon neutrality target.

2060

Nigeria aims to achieve its net-zero emissions target.

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