Saudi Arabia tenders equipment contract for Duba 1

29 April 2014

Client is tendering equipment and engineering, procurement and construction contracts separately

The Saudi Electricity Company (SEC) has invited companies to bid for the original equipment manufacturer (OEM) contract for its planned 550MW Duba 1 integrated solar combined-cycle (ISCC) plant.

SEC has decided to split the project into two contracts: an OEM contract and an engineering, procurement and construction (EPC) contract. MEED recently reported SEC had dropped original plans to develop the ISCC plant as an independent power project (IPP), and is tendering the scheme through a standard EPC model.

For the OEM contract, technical bids are due on 1 June, and commercial bids are due in mid-July. SEC is hoping to place the equipment order in mid-August.

For the EPC contract, SEC is planning to issue the request for proposal (RFP) for the EPC contract by mid-May, with a planned submission date in early September and commercial bids due in late October.

The Duba 1 ISCC is planned to run on a mix of natural gas and solar energy, and will have a total development cost of $600m. The planned commissioning date of the plant is 2017. SEC had previously appointed Germany’s Fichtner as technical consultant, and had awarded a contract to the local law office of Mohanned al-Rasheed, in partnership with the US’ Baker Botts, to provide legal consultancy services for the plant when it was planned as an IPP.

SEC is also planning to develop a second phase of the Duba scheme, Duba 2, which was proposed as an IPP. It is currently unclear whether the second phase will remain an IPP, or will also be switched to an EPC deal. The proposed Duba 2 IPP will have a larger capacity of 1,800MW and an estimated budget of $2.7bn. The planned commissioning date for the Duba 2 IPP is 2018.

The scrapping of plans to develop Duba 1 as an IPP follows the signing of the final project agreements on the Rabigh 2 IPP in December 2013. On 25 December, the local Acwa Power completed the signing of the power purchase agreement (PPA) and project finance agreements for the $1.6bn Rabigh 2 scheme.

The power projects are part of the kingdom’s efforts to boost generating capacity in the coming years to cope with the expected rise in demand. In its 2012 annual report, SEC forecasts that peak demand will grow from the 51,900MW recorded in 2012 to 85,000MW in 2020 and 120,000MW by 2030.

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