Landmark Kuwait power deal unlikely until late August

10 July 2013

Al-Zour North project has still not reached financial close despite being awarded in January

Financial close for Kuwait’s landmark independent power and water project (IWPP), Al-Zour North, is now not expected until late August as the timeline for the scheme faces yet another set of delays.

The project is a key pathfinder scheme for a wider government and private sector investment programme valued at around $30bn. Its success is viewed by bankers and consultants in Kuwait as vital before significant progress can be made on any other private sector investment schemes in the country.

The latest delays come despite a parliamentary enquiry into the project, which had been holding up progress on the scheme, being dropped as a result of the parliament being dissolved in mid-June. The $2.5bn project was awarded to a consortium led by France’s GDF Suez and Japan’s Sumitomo in January, but it has yet to reach commercial close or financial close.

“With Ramadan now starting I think signing the deal is unlikely until later in August now,” says one source involved in the deal.

Another source adds, “Work is still progressing on getting the project company incorporated and finalising the details of the financing, but it seems unlikely it will be finalised in the next few weeks.”

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