Al-Zour conversion hangs in the balance

31 March 2006

The Energy Ministry (Electricity & Water) is understood to be considering whether to proceed with the Al-Zour South power plant conversion project despite a recommendation by the Central Tenders Committee (CTC) that it be retendered after only one bid was submitted in late January (MEED 3:2:06).

A German/local team of Siemens and Alghanim International Contracting & Trading Company was the only bidder for the scheme, with an offer of KD 232 million ($800 million). Local tender regulations stipulate that major projects must receive at least two offers unless special dispensation is granted by the Council of Ministers (cabinet).

As the bid envelope was opened and the results published, it appears likely in this case the Energy Ministry will ask the cabinet for an exemption.

The scope of works on the engineering, procurement and construction (EPC) contract involves the installation of two 250-MW steam turbines and heat recovery boilers at the 1,000-MW gas-fired plant to increase capacity to 1,500 MW. The existing facility was commissioned on a fast-track basis by Siemens in 2004.

Disputing a CTC recommendation is not without recent precedent.

Late last year, the ministry received only one bid - from South Korea's Doosan Heavy Industries & Construction Company - for the Shuwaikh 30 million-gallon-a-day reverse osmosis (RO) seawater desalination plant EPC contract, and asked the government if it could proceed with the scheme regardless. A decision on the matter is expected soon (MEED 7:10:05).

www.meed.com/powerwater

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