Kuwait’s second private power plant to be built at Julai’a

08 February 2011

Engineering, procurement and construction power project to be built at Al-Khiran

Kuwait has concluded technical studies at a site in Julai’a, located in the centre of Kuwait City, for a 1,000MW power plant.

The Electricity Ministry has undertaken the studies for the gas-fired project. According to Law 39, all future power plants in Kuwait over 500MW must be tendered as independent (water and) power projects.

Should the project go ahead, Kuwait’s Partnerships Technical Bureau (PTB) will be responsible for launching it to the market.

“it is a matter of demand and supply. We will see how the market takes the first IWPP before we launch Julai’a,” says Adel al-Roumi, director general of the PTB.

The PTB prequalified 11 groups to bid to build the country’s first independent water and power project (IWPP) at Al-Zour North in December.

The following groups have been prequalified:

  • Acwa Power (Saudi Arabia) with GIC (local) and Samsung (South Korea)
  • AES (US)
  • GDF Suez (France) with Kepco (South Korea)
  • GE (US)
  • International Power (UK)
  • Malakoff International (Malaysia)
  • Marubeni (Japan) with Alghanim (Kuwait)
  • Mitsui (Japan) with Kharafi Group (Kuwait)
  • Sumitomo (Japan)
  • Taqa (UAE)
  • Tenaga Nasional Berhad (Malaysia)

The list has been submitted to cabinet for approval. A request for proposals (RFP) will be issued to qualified bidders soon. The winning bidder will construct the gas-fired project on a design, finance, build, operate and maintain basis. It will have a capacity of 1,500MW of power and 100 million gallons a day (g/d) of desalinated water.

The selected developer will take a 40 per cent stake in the project while the government will take 60 per cent ownership. The company will be listed on the stock exchange. While the developer was originally set to shoulder the risk associated with the IPO, according to Adel al-Roumi, this was changed towards the end of 2010 so that “the government will take the initiative of doing the IPO.”

A team of France’s BNP Paribas, US law firm Chadbourne & Parke and Germany’s Lahmeyer International won the mandate to advise PTB on the project in March 2010.

The Al-Zour North site was selected following an analysis of three sites at Al-Zour, on the east coast of Kuwait. The site was selected as permission has already been granted for another power and water project at Al-Zour North planned by the Electricity & Water Ministry using an engineering, procurement and construction (EPC) contract. The PTB’s IWPP replaced the EPC project.

Kuwait also plans to develop a 2,500-3,000MW power project at Al-Khiran, on the country’s coastline near the Saudi Arabian border.

The oil-fired project will be developed in 500MW phases and will, therefore, be allowed to be tendered in EPC contracts. The first phase is expected to hit the market before the Julai’a power plant.

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications