Saudi Electricity Company (SEC) is set to award a contract to the local Acwa Power within the next three weeks to build an independent power project (IPP) at Qurayyah.

“SEC has evaluated all of the bids and an announcement is expected to be made in the next two to three weeks,” says Yasir Mahmoud, business development manager, Acwa Power.

Mahmoud was speaking at the MEED Saudi Arabian EPC Projects 2011 conference held in Al-Khobar in the Eastern Province of the kingdom.

Acwa Power submitted the lowest bid for the contract in March.Acwa has put together a banking group, including the local National Commercial Bank and Banque Saudi Fransi and the UK’s Standard Chartered and HSBC.

SEC received six bids to develop the Qurayyah IPP after a seventh prequalified bidder, the US’ AES Corporation, pulled out of the process as a result of political unrest in the region.

The six bids opened on 27 March were:

• Acwa Power (Saudi Arabia) and Mena Infrastructure Fund with Samsung C&T (South Korea) as engineering, procurement and construction (EPC) contractor: 1,963MW at 7.417 hals/unit (1.97 $ cents/unit)
• Marubeni Corporation (Japan) with Doosan (South Korea) and Hanwha (South Korea) as EPC contractor: 2,030MW at 8.56 hals/unit
• Sumitomo Corporation (Japan)/Korea Electric Power Corporation (South Korea)/Hyundai Engineering & Construction (South Korea): 1,940MW at 8.62 hals/unit
• GDF Suez (France)/International Power (UK)/Al-Jomaih (Saudi Arabia) with Hyundai Heavy Industries (South Korea) as EPC contractor using turbines from GE (US): 2,066MW at 8.75 hals/unit
• Powertek Berhad (Malaysia)/Saudi Oger (Saudi Arabia) with GS Engineering (South Korea)/Sepco 2 (China) as EPC contractor/JGC Corporation (Japan): 1,832MW at 9.25 hals/unit
• Tenaga Nasional Berhad (Malaysia)/Saudi Binladin (Saudi Arabia) with Iberdrola (Spain) as EPC contractor: 2,063MW at 9.3 hals/unit

AES Corporation had been due to bid with Saudi Masader Company for Water, Power & Gas (Saudi Arabia) as EPC contractor. It pulled out of the bidding for the Saudi project in February, along with a scheme in Oman, as a result of the spread of anti-government protests throughout the region and has now closed its local offices.

Once completed, the Qurayyah project will be a combined-cycle gas turbine (CCGT) power plant with a capacity of 1,800MW-2,100MW. Although originally launched as an oil-fired scheme, SEC changed the fuel source to gas in August 2010 and reissued the request for proposals to developers.

Construction of the plant and associated facilities is scheduled to begin no later than August 2011 and the commercial operation date is scheduled for June 2014. The IPP will be built next to SEC’s existing facility at the Qurayyah site. It will be the third project to be developed under SEC’s IPP programme.

The project will 50 per cent owned by SEC and 50 per cent by the developer. SEC will buy the entire plant’s output under a 20-year power purchase agreement (PPA). SEC will supply gas to the project company on an energy conversion basis. SEC will source the required gas under a separate arrangement with oil major Saudi Aramco.

The US’ Citigroup is financial adviser to the state-owned company in the tender, while the law office of Mohammad bin Saud al-Rasheed, in association with Baker Botts, is legal consultant. Germany’s Fichtner is technical consultant.