Negotiations to start on Taweelah B IWPP

11 October 2004
Abu Dhabi Water & Electricity Authority (ADWEA) is due to start negotiations in the second week of October with the consortium led by Japan's Marubeni Corporationfor the Taweelah B independent water and power project (IWPP), following approval of the bidders' ranking in early October. The Japanese-led consortium, which submitted on 11 July the highest price at $1,690 million for the brownfield IWPP, was ranked first, with Belgium's Tractebeland the UK's International Power, which offered a price of $1,590 million, following in second place. The other bidder was France's Total(MEED 16:7:04).

ADWEA is aiming to sign the key project agreements, including the power and water purchase agreement (PWPA), by mid-December. Under its IWPP procedures, ADWEA negotiates with the first ranked bidder, and only calls in the second-placed bidder - the reserve - if negotiations break down.

The Marubeni-led developer team also includes Japan's JGC Corporation, Malaysia's Pendekar Power and US-based BTU Ventures. Its nominated engineering, procurement and construction (EPC) contractor for the power island is Germany's Siemensand for the desalination, Italy's Fisia Italimpianti. The group has BNP Paribas, ANZ Investment Bankand Kreditanstalt fuer Wiederaufbau as its financial team. The consortium will also be seeking finance from the Japan Bank for International Co-operation (JBIC).

The successful bidder will take a 40 per cent stake in a new project company, which will acquire the existing 1,070-MW, 100 million-gallon-a-day (g/d) B station and expand it on a build-operate basis to take total output up to 2,000 MW and 160 million g/d. The remaining 60 per cent of the project company will be held by ADWEA.

The project's advisory team on B is made up of Germany's Fichtner (technical), HSBC (financial), White & Case(international legal) and Simmons & Simmons(local legal).

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