Muscat scheme is becalmed

26 May 2000
Power And Water

Oman

The future of the long-standing Muscat wastewater project remains uncertain as the parties involved continue to disagree on key financial issues, sources close to the project say. 'A letter has been going back and forth between the parties for some time now and we still do not know if the project will proceed,' says a spokesman for Fichtner of Germany, technical adviser for the project.

It is understood that the main issue obstructing a deal between Muscat Municipality and the favoured bidder, a consortium headed by the local Galfar Engineering & Contracting, relates to risk cover. The contracting consortium would like 50 per cent of the risk to be covered by the government, which it has declined. 'We believe it is very likely that bids will be reinvited,' the Fichtner spokesman adds.

Sources at Galfar say discussions with the client are continuing. 'We are still involved in negotiations, and finalising and closing all clauses of the agreement,' says a spokesman.

The $600 million project covers construction of a wastewater treatment plant and the operation and maintenance of the city's wastewater system. A first strategy report completed by Fichtner in January established that the proposals conform to international standards, although some cost-saving potential was identified in connection with certain technical changes.

PricewaterhouseCoopers and New York-based Curtis, Mallet-Prevost, Colt & Mosle are respectively financial and legal consultant for the project (MEED 28:1:00).

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