Developers line up for Yemeni private power scheme

02 December 2009

Sanaa plans three pilot plants with combined capacity of 375MW

More than 40 companies have expressed interest in Yemen’s first independent power project, according to a senior official at the country’s Electricity & Energy Ministry.

The project involves building three pilot plants with a combined capacity of 375MW.

Developers will build a 150MW plant at Aden in the south, another 150MW plant at Hodeidah in the west, and a third plant with capacity of 75MW at Al-Mukalla, east of Aden.

The International Finance Corporation, part of the World Bank, is advising the Yemeni government on tendering the scheme.

“We should be advertising the request for qualification within a few weeks,” says Wagdi Aman, chairman of the private power unit at the ministry. However, he could not say whether the ministry would issue the request for qualification before the end of 2007.

The US’ K&M Consulting & Engineering, the UK’s Norton Rose with the local Al-Suwaidi & Luqman, and PricewaterhouseCoopers are the technical, legal and accounting advisers respectively.

Sanaa will award the project to the developer that offers to produce the cheapest power for the government at each of the three locations.

The winning developers will carry out the projects under build-own-operate-transfer contracts.

The plants will use heavy fuel oil as feedstock, but Sanaa wants the option to run them on natural gas in the future.

The state-owned Public Electricity Company will buy the plants’ power output.

Yemen’s demand for power grew at an average of 8 per cent a year between 1998 and 2008.

In 2008, the utility’s installed power capacity totalled 852MW and only 40 per cent of the population had access to electricity.

The World Bank estimates Yemen will require more than 900MW of new capacity by 2015 if it is to meet growing demand and maintain a reserve of 25 per cent of its capacity.

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