Saudi Electricity Company (SEC) is to extend the bid deadline for the contract to develop its 2,000MW PP11 independent power project (IPP) in Riyadh by two weeks to 21 December.
The state-owned utility says the extension is in response to requests from bidding groups for more time to price construction costs, after they claimed the utility failed to provide them with the results of a site study, or details of the plant’s design, on schedule.
However, bankers close to the bidding say some developers are struggling to meet SEC’s terms, which require them to secure financing commitments for at least 50 per cent of the project before bidding.
To help developers secure commitments, SEC has told banks they can support multiple groups. But some bidders are insisting on exclusive commitments with bankers, which is hindering other bids.
However, SEC says there will be no further extension to the deadline.
“Competition is strong and every-body has confirmed that they will complete the journey,” says Amer al-Swaha, head of SEC’s IPP programme.
Five groups are planning to bid: Japan’s Marubeni Corporation and Kansai Electric Power Company with Saudi Masader Company for Power, Water & Gas; Belgium’s Suez Energy International and the local Al-Jomaih Group; Malaysia’s Tenaga Nasional Berhad, Sumitomo and Saudi Binladin Group; and the UK’s International Power with Saudi Oger and Korea Electric Power Corporation.
The local Acwa Power Inter-national leads the fifth group, with Japan’s Mitsubishi Corporation and Tokyo Electric Power Company.
The PP11 plant is planned to start prod-ucing commercial electricity in 2012.