Kuwait to prequalify advisers for wastewater plant expansion

05 October 2010

The Partnerships Technical Bureau is looking to appoint a transaction adviser for the scheme

Kuwait’s Partnerships Technical Bureau (PTB) has received about 20 responses to a request for qualification (RFQ) for transaction advisers for the construction of a wastewater treatment plant at Umm al-Hayman.

Firms with technical, financial, environmental, and legal experience and previous participation in wastewater treatment projects were invited to respond to the RFQ.

According to a source at the PTB, eight to 10 companies will be shortlisted to receive the request for proposals (RFP) and a selection is to be made by the end of 2010 or in early 2011.

The chosen consultant will advise on the expansion of the Umm al-Hayman plant from its current wastewater treatment capacity of 27,000 cubic metres a day (cm/d) to around 600,000 cm/d.

The expansion project will be carried out in two phases. The first phase will see around 400-450,000 cm/d capacity brought online by 2015. The enlarged Umm al-Hayman wastewater treatment project will serve a new city at the site.

The extension of the Umm al-Hayman facility will also treat raw sewage that will be diverted from the Riqqa plant, which has a capacity of 180,000 cm/d, which is to be decommissioned.

The project, located on the coast some 50 kilometres south of Kuwait City, was originally to be developed as a design and construct project by the Public Works Ministry, who had appointed Lebanon-based Dar al-Handasah (Shair and Partners) in January 2009 as the consultant for the design, construction supervision and environmental study (MEED 19:1:10).

The Partnerships Technical Bureau (PTB) has recently joined the project and may develop the project as a public-private partnership (PPP) scheme.

The project will be a publicly traded project company with 50 per cent of the ownership held in shares. The developer will take a 40 per cent stake, while the government is to retain a 10 per cent stake.

The chosen consultant will be tasked with completing a study, establishing a project company and closing financing within 18 months of appointment. The company will be floated before or around the start of construction of the project.

Under Kuwait’s capital markets law, the company will be allowed to list before the project starts operating. It is still unclear how the company will attract shareholders before the project has started up and bringing in revenue.

According to a source at the PTB, “agreements by the government and the developer” will be used to draw investors who will fund the construction of the project. “The idea is to have funds for the company and secure all the agreements for the operator so that it can start designing and building.”

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