Kuwait invites interest for second private power and water project

24 April 2013

Second phase of Kuwait’s Al-Zour North power and water scheme will have same capacity as first phase

Kuwait’s Partnerships Technical Bureau (PTB) has invited companies to express interest in the second phase of its Al-Zour North independent water and power project (IWPP).

Companies have until 27 June to submit an expression of interest (EoI) to the PTB. The second phase will involve building a combined power and desalination plant with a power generation capacity of 1,500MW and a water desalination capacity of 102 million gallons a day (g/d). The plant will have the same capacities as the first phase. The PTB is developing the project in partnership with the Ministry of Electricity & Water (MEW).

As with the first phase, the project will use natural gas as its main feedstock and gas oil as back-up fuel. Gas and gas oil will be provided by the MEW. The desalination plant will use either a 100 per cent thermal process or a hybrid process. In the case of a hybrid solution, the capacity of the reverse osmosis plant is not to exceed 25 per cent of the total desalination capacity. The project is expected to use combined-cycle turbine technology.

In January, the PTB awarded the consortium of UK/French company GDF Suez, Japan’s Sumitomo and Kuwait’s AH Sagar & Brothers Group the contract to build the first phase of the Al-Zour North project.

A special-purpose vehicle (SPV) will be established as a Kuwaiti public joint stock company to develop the first phase, with 40 per cent owned by the successful bidder. The remainder will be held by a combination of Kuwaiti public entities directly and Kuwaiti nationals. A similar SPV will be created to develop the second plant.

The Al-Zour North IWPP has long been viewed by those in Kuwait’s projects and finance sectors as a key project for Kuwait’s ambitious public-private partnership (PPP) programme. As the PTB’s first project, it is regarded as a catalyst for the rest of the country’s planned schemes, which require private investment.

Another PTB scheme currently under discussion is the Umm al-Hayman wastewater project.

In September last year, the PTB prequalified six groups to bid for the contract to build the Umm al-Hayman wastewater PPP project. The scheme will increase the capacity of the southern region of Kuwait for dealing with waste by 20 times, compared with current capabilities. The plant will have an initial capacity of 500,000 cubic metres a day (cm/d), which is planned to increase to 700,000 cm/d by 2020.

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