Iraq’s Municipalities and Public Works Ministry has awarded an international consortium an estimated $115m contract to build a desalination plant in the southern city of Basra.

The consortium comprises France’s Veolia Water, Japan’s Hitachi and Egypt’s ArabCo. The contract is a build and operate agreement for five years.

The contract will involve the construction and engineering of an ultrafiltration unit with reverse osmosis (RO) membranes. The expected capacity of the plant is 200,000 cubic metres a day (cm/d) and will provide clean drinking water to the 2.3 million residents of Basra.

As a result of the country’s electricity shortage, the desalination plant will be built with its own power generators. Construction is due to begin in the first quarter of 2014 and is expected to be completed in the third quarter of 2016.

Due to Basra’s strategic location as Iraq’s port city on the Gulf, the government is prioritising the development of water utilities in the area.

This is the second major desalination contract Veolia Water has been awarded in the Gulf in the past eight months. In July last year, Saudi Arabia’s Marafiq awarded the French firm a $310m contract to build a water desalination plant to supply the Sadara petrochemical complex in Jubail Industrial City.