Contractors want offset removed from Kuwait airport bids

25 November 2013

New terminal at Kuwait International airport will cost an estimated $3.5bn

Some international contractors are lobbying Kuwait’s government to remove the offset programme, which withholds part of their payment until the project is completed, from bids on the upcoming KD1bn ($3.5bn) new terminal project planned at Kuwait International Airport.

Speaking at MEED’s Kuwait Projects 2013 conference, Jeff de Lange, deputy managing director at the local Gulf Consult, which is working on the new terminal project, said that, at a recent meeting of potential bidders on the project, “Some of the contractors present pleaded with the Ministry of Public Works to remove the offset.”

Under Kuwait’s offset programme, government clients hold back part of the payment for the work until the contract is completed, which can have a significant impact if a contract lasts for two to three years or longer. “[Some of the contractors] said if it is not removed, they will simply add the offset costs to the bid price,” said De Lange.

The new terminal will contain 30-51 gates, a transit hotel, VIP and first-class lounges, and car parking for 4,500 vehicles.

It was designed by a team led by the UK’s Foster & Partners, which won the contract in November 2009. Foster & Partners is working with local firm Gulf Consult. The design team also includes the UK’s Arup, the US’ Parsons Brinckerhoff and the Netherlands Airport Company. The terminal will increase capacity at the airport from 6 million passengers a year to 13 million.

The new terminal will be located south of the existing terminal, between the two runways. It is designed to set a new environmental benchmark for airport buildings and is inspired by local forms and materials. The new building will consist of three symmetrical wings of departure gates, each spanning 1.2 kilometres. The project aims to be the first passenger terminal in the world to achieve Leadership in Energy and Environmental Design (Leed) Gold standard.

The total investment in developing Kuwait’s International airport is expected to reach $6bn. In addition to the new terminal, an estimated $3bn will be spent on widening runways, enhancing control tower facilities and building new cargo facilities.

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