The consortium led by Belgium's Tractebel and Kuwait's Gulf Investment Corporation (GIC)on 31 July signed the key project agreements with the Ministry of Finance & National Economy (MoFNE) for the kingdom's first independent power project (IPP) at Al-Ezzal. The group was low bidder by 15.9 per cent at BD 8.090 ($21.289) per MW/h for the project when five bids were submitted in June (MEED 24:6:04)
Manama has signed a 20-year offtake agreement with the developer, which is obliged to ensure the availability of 470 MW by the summer of 2006 - when current generating capacity is due to fall behind demand on current trends - and 1,000 MW in 2007. MoFNE's advisers on the project were BNP Paribas, the UK's Mott MacDonaldand UK-based Freshfields Bruckhaus Derringer. Total project costs are estimated at $500 million. Tractebel and GIC will jointly invest $120 million of paid-up capital in the project company, a portion of which is likely to be sold through an initial public offering (IPO). The remainder will be financed by a commercial loan secured from a club of nine banks led by HSBCand Societe Generale(see Banking & Finance). Germany's Siemensis the nominated engineering, procurement and construction (EPC) contractor. The award is Tractebel's second success in less than a month: the company signed up for the Sohar independent water and power project (IWPP) in Oman in July (MEED 9:7:04).