Kuwait’s first independent power and water project (IWPP) and a pathfinder scheme for a wider government and private sector investment programme valued at around $30bn, is set to reach financial close before June, according to sources close to the project.
Work on the $2.5bn Al-Zour North IWPP is still progressing despite a parliamentary investigation that was launched in early February into the award of the project to a consortium led by the UK/French GDF Suez/International Power and Japan’s Sumitomo earlier this year. Financial close is still on track for May.
“Work on the documentation is still happening so [we] are targeting financial close in the second quarter,” says one adviser on the project.
The project has already gone through two government investigations, including one by the State Audit Bureau. Both approved the scheme. “The project has been given a clean bill of health by two investigations already and once this enquiry is over, the state will have exhausted all avenues by which anyone opposed to the privatisation plan could get in the way of this project going ahead,” adds another source close to the project. “That will be good news for all the other projects being planned in Kuwait.”
The Partnerships Technical Bureau (PTB) has been established by the Kuwaiti government to move forward with a raft of projects developed in cooperation with private sector firms. It hopes that by doing so it will diversify Kuwait’s economy and boost growth. Al-Zour North was intended to be the pathfinder for this broader plan, but has hit several hurdles along the way, including parliament voting to scrap the project. Now that Al-Zour North is approaching financial close, observers say plans to develop other projects in Kuwait will start accelerating.