Muscat ditches plans for coal-fired plant

28 March 2008
State power and water company launches study to find long-term solution for fuel feedstock.

Muscat has ruled out using coal as the fuel for its next independent water and power project (IWPP) and launched a fresh study into the fuel to be used for future plants.

Bidders for the advisory contracts on the project, known as Barka III, were initially told they could be asked to study the possibility of the plant being coal-fired.

But with the 700MW and 26 million-gallon-a-day plant due to come on line in 2011, Oman Power & Water Procurement Company (OPWP) has abandoned the idea.

“There was an optional scope in the tender, but we are not intending to exercise that,” says a source at OPWP. “The time limit does not allow that.”

The utility company has invited bids for a fuel selection study for new IWPPs.

“We have decided to carry out a proper study before moving into coal or any other source of fuel,” says the source.

The objective of the study is to provide a long-term solution to the challenge of securing gas feedstock for future projects.

OPWP currently uses sweet natural gas to fire its plants and the study will evaluate the feasibility of using different fuels.

In December, the Oman Tender Board announced that the legal consultancy contract for Barka III had been awarded to the UK’s Berwin Leighton Paisner, and Switzerland’s Electrowatt Engineering Services had won the technical advisory contract. Both com-panies have yet to sign a contract, although the reason for the delay is unclear.

“The tender board has given approval, but we have internal reasons for the delay in the award to the companies,” says the source.

An award on the financial advisory package has also been delayed. The Financial Corporation Company is the low bidder for the work. Bids were also submitted by HSBC, Bank Muscat, Ernst & Young and KPMG.

“We intend to award all the advisory services at the same time,” says the source. “Hopefully, we will award them within weeks.”

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