The plant will have capacity of 220 million gallons a day of water and 850-1,100MW. The project sponsor, Saudi Arabia’s Water and Electricity Company (WEC), is now evaluating the bids.
A consortium of the local Acwa Power and South Korean Electric Power Corporation (Kepco) was the last to secure bank commitments, and is now working with Gulf International Bank, BayernLB, Korea’s Woori Bank, and Samba.
It submitted an offer of SR0.1013 a kWh and SR4.4978 a cubic metre of water. Kepco is the group’s engineering, procurement and construction (EPC) contractor.
The second consortium includes Japan’s Sumitomo Corporation with Malaysia’s Malakoff International and the local Aljomaih Automotive Company. It is working with Royal Bank of Scotland, Citigroup, Sumitomo Mitsui Banking Corporation, Mizuho, Bank of Tokyo-Mitsubishi and Japan Bank for International Co-operation (JBIC).
The Sumitomo team bid SR0.1036 a kWh of power and SR4.1384 a cubic metre of desalinated water. South Korea’s Daewoo Engineering & Construction and Italy’s Fisia Italimpianti are the group’s power and water EPC contractors respectively.
The third consortium, of Belgium’s Suez Energy International with Japan’s Marubeni Corporation, has banking support from Calyon, Standard Chartered, National Commercial Bank, and Banque Saudi Fransi.
It submitted a price of SR0.18191 ($0.05) a kWh and SR3.61789 a cubic metre of desalinated water. South Korea’s Hyundai Heavy Industries is the group’s EPC contractor.
A fourth shortlisted bidder, a consortium led by Saudi Masader and Taiwan Power Company, withdrew from the bidding process on 26 June. Arab Bank, who were acting as financial advisers to the consortium had arranged bank support from Al-Rajhi and Saudi Hollandi Bank.
WEC expects to announce the preferred bidder by the end of September 2008 after which it will enter into negotiations with the chosen consortium. A power and water purchase agreement is due to be signed in the fourth quarter of 2008.
The winning consortium will take a 60 per cent stake in the Ras al-Zour project company, which will build, own and operate the plant. The Public Investment Fund will hold 32 per cent with the remaining 8 per cent to be owned by Saudi Electricity Company. The project company will sell its output to WEC under a 20-year agreement.
HSBC is WEC’s financial consultant and co-ordinating adviser, and Clifford Chance and Al-Jadaan law firm are the legal advisers on the project. Germany’s Fichtner is the technical consultant.
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