Following clarification meetings with prequalified developers in Dubai in late September, it is expected that three groups will submit bids for the Shouaiba independent water and power project (IWPP) by the January deadline.

The UK's International Power (IP), alongside Saudi Ogerand Xenel Industries, both local, and Sumitomo Corporationand Mitsui & Company, both of Japan, have formed one group, which has a bank supporting group comprising Arab National Bank, Banque Saudi Fransi, Calyonand Sumitomo-Mitsui Banking Corporation.

Belgium's Tractebel and the local Bugshan Grouphave formed a second group, which is supported by BNP Paribas, Gulf International Bankand Samba Financial Group.

The third bid is expected from Malaysia's Tanaka National and Malakoffand the local Acwapower and Mada. Sources say that Germany's Siemens and South Korea's Doosan Heavy Industries & Construction Company have lined up as the engineering, procurement and construction (EPC) contractors. This consortium is understood to have financial backing from ANZ Investment Bank and Riyad Bank.

Project sources say that some of the other developers to have been prequalified - such as the UAE's Union Water & Electricity Company and the local Al-Baraka Investment & Development Company- remain keen to join bidding groups.

The consortia remain fluid until formal notification of their formation has been presented to the Water & Electricity Company (WEC), the joint venture offtaker formed by Saudi Electricity Company (SEC)and the Saline Water Conversion Corporation.

The Finance Ministry has provided a monthly payment guarantee on the offtake agreement and a termination guarantee. It is understood that SEC is paying for the guarantee.

The advisory team on the 650-900-MW, 194 million-gallon-a-day (g/d) Shouaiba project comprises HSBC(financial), Germany's Fichtner(technical) and Clifford Chancewith the local Law Firm of Yousef & Mohammed al-Jadaan(legal).