Kuwait’s Partnerships Technical Bureau (PTB) plans to award advisory contracts on three multibillion-dollar public-private partnership (PPP) projects by the end of the year.

Kuwait award contracts *  
Budget value ($m) Award date
2,421.00 2010 Q1
13,058.00 2010 Q2
11,208.00 2010 Q3e
32,257.00 2010 Q4e
7,754.00 2011 Q1e
29,260.00 2011 Q2e
16,426.00 2011 Q3e
21,147.00 2011 Q4e
1,200.00 2011 Q4e
77,000.00 2012 Q1e
13,385.00 2012 Q2e
1,000.00 2012 Q3e
5,212.00 2013 Q4e
*=Planned (2010-2013); e=Estimate
Source: MEED Projects

The bureau received formal expressions of interest for the deal to provide the PTB and the Public Works Ministry with advisory services on the estimated $3bn development of Failaka Island into a tourist resort on 15 June. The bureau set a deadline of 16 June for expressions of interest in advisory services on a new estimated $10bn emirate-wide rail network sponsored by the Communication Ministry.

The bureau plans to start qualifying interested consortiums to bid on the deals before the end of June and wants to have drawn up a shortlist of bidders by the end of July, officials say.

Key projects under development by Kuwait’s PTB
Project Client Value ($m) Status
Failaka Island tourism development Public Works Ministry 3,000.00 Advisory expressions of interest in on 15 June
Railroad project Communication Ministry 10,000.00 Advisory expressions of interest in on 16 June
Kuwait City Metro project Communication Ministry 7,000.00 Advisory bidding closed          27 May
Kuwait Airport development schemes  Directorate of General and Civil Aviation unknown Invitations to bid to be sent out on 24 June
Six new Labour Cities Kuwait Municipality 1,500.00 Invitations to bid to be sent out in early July
Al-Zour independent water and power plant Energy and Water Ministry 2,500-3,000 Invitations to bid to be sent out on 24 June
Solar power project Energy and Water Ministry; Toyota Corporation (Japan) 650 Tender planned by year end
Source: MEED Projects

Meanwhile, bidding on the advisory services on the ministry-planned $7bn Kuwait City metro network closed on 27 May, and the bureau is in the process of finalising the selection of a winner from a shortlist of nine consortiums. It hopes to award the contract by late August after it is given approval by the government’s Kuwait Audit Bureau.

Each bidding consortium is made up of firms able to provide technical, environmental, legal, financial and project management services to the respective ministries.

The bureau, which was set up in 2008 to help government ministries to develop new schemes under the country’s PPP law of that year is currently working on 24 projects worth a total of KD6bn ($20.6bn), senior officials say.

The PTB helps government ministries and companies to develop new PPP projects by working with them on feasibility studies; selecting transaction advisory consultants to draw up contracts and plans to tender the projects to investors; and overseeing the process of tendering the projects to investors and developers.

Other PTB-supervised projects are at later stages of development. The bureau plans to invite developers to prequalify to bid on four projects for the Directorate of General and Civil Aviation on 24 June. Planning for these projects has been completed, and they have been approved by the Higher Committee for PPP projects.

They cover the development of a new four-star airport hotel, aircraft maintenance facilities, shipping and cargo facilities, and airport fuel stations at Kuwait Airport. The bureau hopes to have created a shortlist from the 60 interested firms by the end of July.

Tender documents will also be sent to potential investors for the development of six new labour cities in the first week of July. Planning for the cities, each of which is planned to house around 40,000 Kuwaitis, has been completed and the PTB and Kuwait Municipality estimate overall cost of the scheme will be $1.5bn.

The most advanced scheme the bureau is working on is the country’s first independent water and power plant (IWPP) at Al-Zour, with the Energy and Water Ministry. The PTB awarded a technical advisory deal for the scheme, which it values at $2.5-3bn, to French bank BNP Paribas, US law firm Chadbourne & Parke and Germany’s Lahmeyer International in March.

The PTB is currently meeting with potential investors and developers over the plant, which will produce 1,500MW of power and 100 million gallons a day of desalinated water. It plans to send out tender documents to investors interested in a strategic 40 per cent share in the scheme by 24 June, and to tender the contract to build and operate the plant by mid-July.

Many in the country see the IWPP project as key test of the government’s PPP programme after years of delays to new power and water schemes along with other pieces of vital infrastructure development on the back of suffocating bureaucracy and political wrangling.

“This is the centrepoint project for the PTB,” says one government official. “It is make or break [for the PPP programme].”

Government officials say they are confident that the project, and the other 23 planned by the PTB, will go ahead. International bankers and businessmen in the country say that a recent spirit of compromise between the government and the National Assembly, or parliament should prevent the political deadlock that stalled earlier schemes.

“The signs are overwhelmingly positive,” says one senior international banker based in Kuwait City. “As for international businesses, there is a significant amount of interest and the banks are definitely feeling that.”