Qatar signs Facility D contract

25 May 2015

Japanese-led consortium was selected as preferred bidder in early March

  • Consortium led by Japan’s Mitsubishi officially signs contract with Kahramaa
  • Project will be Tepco’s first foreign project since Fukishima disaster
  • Project will require an estimated $3bn investment

Qatar General Electricity & Water Corporation (Kahramaa) has officially signed the contract with the consortium led by Japan’s Mitsubishi to develop Qatar’s next independent water and power project (IWPP), known as Facility D.

MEED reported on 1 March that the Mitsubishi consortium, which also contains Japan’s Tokyo Electric Power Company (Tepco), had been selected as the preferred bidder.

Kahramaa officially signed the contract with the consortium in Doha on 24 May.

The proposed IWPP is planned to be located in the Qatar Economic Zone (QEZ) near Mesaieed and will have a capacity of 2,280-2,520MW and 123.5-136.5 million imperial gallons a day (MIGD) of water.

About 70-90 MIGD of the desalination capacity will be from multi-stage flash (MSF)/multi-effect distillation (MED) technology, with the remaining 40-60 MIGD coming from reverse osmosis (RO) technology, which has to date only been implemented on a small scale in the country.

Facility D is estimated to require $3bn-worth of investment, with a large proportion of this to be project financed by banks. It is thought government-backed export credit agencies (ECAs), such as Japan Bank for International Cooperation (Jbic), will have to play a role in raising the necessary funding.

Kahramaa owns 60 per cent of the project, with Qatar Petroleum (QP) and Qatar Foundation both holding 5 per cent stakes. Mitsubishi holds the remaining 30 per cent stake.

Despite having recorded some of the highest demand growth for power and desalination in the Gulf in recent years, Qatar has been able to build up one of the highest reserve margins in the region.

However, with consumption expected to continue to rise steeply as the state pushes ahead with its construction programme for hosting the 2022 Fifa football World Cup, Kahramaa is moving ahead with the Facility D project to ensure supply remains above demand.

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