• Al-Zour North 2 will be Kuwait’s second independent water and power project (IWPP)
  • Seven consortiums have been prequalified to participate in tender
  • Request for proposals (RFPs) are expected to be issued imminently

The Kuwait Authority for Public Partnerships (KAPP) has prequalified seven consortiums for the country’s second independent water and power project (IWPP), Al-Zour North 2.

KAPP, the body overseeing the country’s public-private partnership (PPP) programme, received prequalification entries from groups in early April for the IWPP.

The seven prequalified groups are led by the following developers:

  • Abengoa (Spain)
  • Acwa Power (Saudi Arabia)/Al-Mulla (local)
  • Kepco (South Korea)
  • Marubeni (Japan)/Fouad al-Ghanim (local)
  • Mitsubishi (Japan)
  • Mitsui (Japan)
  • Sumitomo (Japan)/Osaka Gas Company (Japan)/ National Industries Holding Consortium (local)

Tender documents for the project are expected to be issued imminently.

The Al-Zour North 2 IWPP will have a power capacity of at least 1,500MW, to be provided through combined-cycle gas turbines, and a desalination capacity of 102 million imperial gallons a day (MIGD). As with the first phase, the Al-Zour North phase 2 project will use natural gas as the main feedstock and gas oil will be provided by the Ministry of Electricity and Water (MEW).

The Al-Zour North 2 scheme has fallen behind scheduled, with developers having been invited to submit expressions of interest (EOI) for the scheme in June 2013.

KAPP is also planning to progress with the Al-Khiran 1 IWPP, which will have the same generation capacity as Al-Zour North 2 IWPP, but a slightly larger desalination capacity of 125 MIGD. Prequalification entries for the Al-Khiran project were received on the same day as the Al-Zour North 2 project, but it is believed that KAPP and MEW will stagger the tendering process due to the large size of both projects.

Progress with both projects stalled as a result of the restructuring of KAPP’s predecessor, the Partnerships Technical Bureau (PTB). The restructuring of Kuwait’s PPP body, which happened in parallel with the amendments of the country’s PPP and IWPP laws, was implemented in response to the slow procurement process for the country’s first PPP project, the Al-Zour North 1 IWPP.

In December 2013, the final project agreements for the much delayed Al-Zour North IWPP were signed. The project company set up to develop the IWPP, which is 40 per cent owned by a consortium of the UK/French GDF Suez, Japan’s Sumitomo Corporation and local Abdullah Hama al-Sagar & Brothers, awarded South Korea’s Hyundai Heavy Industries (HHI) and France’s Sidem the $1.4bn EPC contract to build the plant.

HHI will build the gas-fired 1,500MW, combined-cycle power plant, while Sidem will build the 107 million gallon-a-day desalination component of the first Al-Zour project.

The country’s IWPP programme is part of the government’s efforts to meet the rapid demand growth for both power and water.

Kuwait’s Ministry of Electricity and Water forecasts that peak power demand will climb from 12,800MW in 2013 to 14,000MW in 2015 and to 22,500MW by 2022. To meet the demand and build in a reserve margin of about 10 per cent, the ministry estimates that available conventional power capacity will have to reach 25,500MW by 2022, an 80 per cent growth in capacity.