• Contract awards for $3bn mega-reservoirs expected this quarter
  • Banks expected to compete to provide contract financing
  • Reservoirs will provide seven-day water storage supply

Banks are awaiting the award of the main construction contracts for Qatar’s $3bn Water Security Mega Reservoirs project, hoping to provide the winning bidders equipment and contract financing.

Sources suggest that the contracts will be awarded this quarter, with bids having been submitted to Qatar General Electricity & Water Corporation (Kahramaa) last September.

“This is a key infrastructure project with an undoubted project sponsor, so appetite across the banking sector should be competitive,” says a Doha-based banker.

Contractors were invited to submit bids for five packages – A, B, C, D and E – to build the reservoirs and associated infrastructure at the five locations planned for the schemes last year.

The sites where the reservoirs will be located are: Umm Birka; Umm Slal; Al-Thumama; Rawdhat; Rashid; and Abu Nakhla.

Local and international banks have already supported earlier contracts awarded by Kahramaa.

HSBC signed QR1bn-worth ($275m) of contract-related finance with Al-Jaber Engineering Company in mid-2014.

In December last year, Al-Khalij Commercial Bank provided contractor financing to local Boom Construction Company and Lebanon’s CAT International Qatar for the development of transmission pipelines for the reservoirs. The total value of that project was more than QR900m.

The project is intended to provide seven days of strategic water storage to prevent disruptions in the supply to Qatar.

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