A consortium led by Saudi Arabia’s Acwa Power has been awarded the contract to develop the Salalah independent water project (IWP) in Oman.

The consortium, which also contains France’s Veolia and the local Dhofar International Development & Investment Holding Company (DIDC), will develop the 25 million imperial gallons a day (MIGD) desalination plant in the Southern Omani governorate of Dhofar.

The developer consortium, which has formed Dhofar Desalination Company, has signed a 20-year water purchase agreement (WPA) with state utility Oman Power & Water Procurement Company (OPWP) to supply water from the plant.

The project company has awarded the engineering, procurement and construction (EPC) contract to a consortium of Italy’s Fisia Italimpianti and Spain’s Abengoa to build the Salalah plant. The value of the EPC deal is expected to be over $100m. Construction works are due to begin to start in the second quarter of 2018.

OPWP received proposals from three developer groups for the contract in October 2016.

The plant will play a key part in meeting the rapidly growing demand for water in the Dhofar governorate. OPWP expects demand for water in the sultanate’s southern region to grow by an annual rate of 9 per cent, from 125,000 cubic metres a day (cm/d) to 231,000 cm/d by 2023.