‘The RFP [request for proposal] was not particularly detailed,’ says one of the prospective bidders. ‘For example, nowhere does it explicitly say whether the project will be an IWPP [independent water and power project]. They could still take the EPC [engineering, procurement and construction] route. This would actually create a more challenging financing situation, and would require a lot more work than just digging out the tried-and-tested IWPP template.’
If the IWPP route is taken, it will be Abu Dhabi’s fifth. The fourth, at Umm al-Nar, has recently been signed (see Power & Water, page 21). However, there is growing speculation that declining interest from developers and the banking community for more exposure to Abu Dhabi utilities risk could encourage Abu Dhabi Water & Electricity Authority (ADWEA) to opt for the EPC approach.
The schedule sketched out in the RFP indicates that a financial adviser will be appointed quickly: kick-off meetings are supposed to take place on 30 April, though bankers say the bid deadline extension is likely to push this back into early May.
If the IWPP route is taken, the RFP is scheduled to be dispatched to prequalified developers by 31 July and they will be given until January 2004 to submit their bids. Financial close is expected by December 2004 and the project is due to be operational by May 2007.
‘The schedule is sensible, if a little tight,’ says a banker looking at the transaction. ‘But some of these deadlines will prove to be very fungible.’
The scope of the Mirfa project has been scaled back from the original plans. The current proposal sees the installation of 600-700 MW of new generating capacity and 22.5 million gallons a day (g/d) of new desalination capacity. The Mirfa complex already has 192 MW and 16.2 million g/d of installed capacity.
Germany’s Fichtner has been appointed technical consultant on the project (MEED 21:3:03, Power & Water).