Adwea fast-tracks Shuweihat

02 November 2007

Abu Dhabi Water & Electricity Authority (Adwea) has taken the unprecedented step of inviting two developer groups to submit proposals for Shuweihat 2, its latest independent water and power project (IWPP).

Instead of the usual process of tendering the project among prequalified developers, Adwea has approached the two groups who provided the two best bids for its recent Fujairah 2 IWPP (MEED 15:6:07).

The move is seen as an attempt to accelerate the implementation schedule for the 1,600-MW and 100 million-gallon-a-day plant, output from which will in part be used by the proposed aluminium smelter in the Western Region.

The groups requested to submit proposals by the 5 November deadline are the UK's International Power (IP) with Japan's Marubeni Corporation, and Belgium's Suez Energy International. Adwea is looking for them to offer the same tariff rates on the Shuweihat scheme as they did on Fujairah.

With engineering, procurement and construction costs rising rapidly, however, it is unclear whether the developers will be able to match those offers.

The IP/Marubeni group won the Fujairah contract, with an electricity tariff of AED 0.107 ($0.03) a kWh and a desalination cost of AED 13.404 ($3.64) per 1,000 gallons. Its electricity tariff was higher than the one submitted by Suez Energy International, but the desalination cost was lower.

If the Shuweihat prices fail to meet Adwea's expectations, it is likely to revert to its original plan of tendering the project among the international developers that applied to prequalify in August (MEED 20:7:07).

The Western Region aluminium smelter is planned by a joint venture of the government and Comalco Aluminium, part of Australia's Rio Tinto. The plant is due to be completed in 2011.

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