LEBANON: Looking to invest $2 billion

24 January 1997

WITH annual rainfall of up to 1,250 millimetres in the mountains, Lebanon is spared the water supply problems faced by other countries in the region. However, the lack of adequate water storage facilities is acute, and exacerbated, like other areas of Lebanon's battered infrastructure, by damage inflicted during the war years, from 1975-90.

According to official estimates, 100 per cent of the country received drinking water supplies before the war. Wastewater treatment services were provided to 80 per cent of the urban population, but only 10 per cent of rural areas. The National Emergency Reconstruction Programme (NERP), which started in 1993, set the goal of supplying every Lebanese with 80 litres of water a day. However, progress has been limited by the slow and costly nature of the work and the government's preoccupation with rehabilitating the power and telecommunications sectors.

Original cost estimates were based on 12 damage assessment reports hurriedly completed in 1992. These put the total cost of rehabilitating the water sector at $250 million. This has subsequently been revised to $900 million, to be invested over three years. The first year entailed the repair of war damage, all of which was completed by early 1996. The second and third year works are now at feasibility, design or initial implementation stages, the Council for Development & Reconstruction (CDR) says.

Sir Alexander Gibb & Partners of the UK, the Kuwait Consulting & Investment Company and the local Khatib & Alami were appointed to carry out studies and designs and supervise construction of the second and third year rehabilitation works in the Greater Beirut area. The consortium's two-year contract expired in December, by which time it had overseen the award of three contracts and completed tender documents for a further 14. All the works are being financed by the Kuwait Fund for Arab Economic Development, at a total cost of $30 million- 35 million. The contracts are divided into three categories: the refurbishment of the existing assets of the Ain al-Delbe and Beirut water authorities; supply contracts for pipes, fittings, and operation and maintenance equipment; and pipe-laying contracts, particularly in the southern suburbs of Beirut.

However, Beirutis are looking to another scheme to solve their water supply problems: the Awali-Beirut water conveyor. The scheme will convey treated water from the Awali river in the south, through a 24-kilometre tunnel to a reservoir in Hadath for distribution to Beirut. The aim is to make up the city's shortfall of supply against demand, estimated at more than 50 per cent, for up to 30 years.

The UK's Montgomery Watson completed detailed designs and tender documents for the scheme almost a year ago, but progress was held up until the government decided in late 1996 to proceed with the project on a build-operate-transfer (BOT) basis. The World Bank has drawn up terms of reference for the contract, and offers are now under evaluation from consultants to help the CDR prepare revised tender documents. The only bidders are understood to be Montgomery Watson and Germany's Lahmeyer International. The World Bank is also considering providing a partial risk guarantee to cover at least a third of the total estimated cost of $150 million. The construction of the 260,000-cubic- metre-a-day treatment plant is expected to take three years. The concession period is expected to be approximately 20 years.


The UK's Brown & Root Projects is carrying out studies, designs and construction management for rehabilitation works in all other areas of Lebanon. Considerable progress has already been achieved. Work worth $90 million had been completed by the end of 1996, and finance is available for work worth a further $250 million. Contracts worth $140 million with finance arranged are under negotiation. Brown & Root says it has identified work worth another $770 million, for which financing has yet to be secured. In the wastewater sector, works have been completed worth $90 million, and projects costing a total of $40 million are under way. Contracts worth $240 million are under negotiation, with finance secured. Works worth a further $230 million have been identified, but have yet to secure finance.

This record is impressive, but the scale of the work still to be done is daunting. Brown & Root has studied all population centres of at least 5,000 people, and found that 61 sewage treatment plants are required at a total cost of $210 million, excluding the cost of sludge handling, disposal and tertiary treatment. Moreover, Brown & Root estimates the total cost of the long-term rehabilitation and expansion work at

$1,000 million for the drinking water sector and $1,200 million for wastewater works.

International support has concentrated on reducing pollution caused by the inadequacy or lack of sewage systems, particularly in the coastal cities of Tripoli, Sidon and Tyre. The European Investment Bank (EIB) has approved a loan of ECU 100 million ($125 million), which it expects to sign in April, to finance the rehabilitation of the wastewater treatment network in Tripoli. Bids for the work, as well as two other contracts to upgrade the wastewater systems of Batroun, Qoubayyat and Akkar, were due on 17 January. The main international bidders include Mohamed Abdulmohsin Kharafi & Sons of Kuwait, John Laing International and Costain, both of the UK, Germany's Philipp Holzmann and Sogea of France.

The EIB also signed a loan of ECU 50 million ($62.5 million) in late October to finance work on the wastewater treatment systems in Tyre, Sidon and Kesrouan. The World Bank has lent $55 million and Japan Y13,200 million ($113.6 million) to finance the work. Bids are also due in mid-February for the construction of a wastewater treatment plant in Baalbek, financed by the World Bank, and for a contract to drill wells and build drinking water networks in the Akkar area of northern Lebanon.

These contracts reflect the CDR's decision to concentrate on upgrading the water systems in the north, the south and the Beqaa Valley. The decision may be explained by the concentration of population in these areas and the necessity of pollution control, but one UK consultant describes the inland wastewater networks as 'an almost totally neglected sector'. It remains to be seen whether the government will ensure the extension of rehabilitation works to all areas of the country, before the inadequacy of public services becomes a greater source of public resentment.

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