The committee supervising the ACWA Power Research Chair for Water and Power met to discuss the applied fields of research and agree on the person directing the chair, in preparation for the chair launch activities.
Mr. Mohammad Abunayyan, Chairman of ACWA Power Projects (APP), had signed agreement with His Excellency Dr. Abdullah Al-Othman, Rector of King Saud University (KSU), to establish and sponsor a chair focused on research in water and power, two strategic commodities in Saudi Arabia.
The supervising committee’s meeting was attended by representatives from APP and KSU’s College of Engineering. Both sides have agreed on the following action points: Firstly, development of membranes used in reverse osmosis. Secondly, development of anti-scaling chemicals used in thermal desalination plant. Thirdly, selection of an internationally-renowned researcher–to be announced at a later date–to direct the chair. Fourthly, launching of Chair activities by mid-November, allowing for sufficient preparation time.
ACWA Power Projects corporate social responsibility focuses on sustainable development sponsoring programs and initiatives such as Wafeer, an initiative launched by Tamkeen designed to reduce the consumption of water in industry. Wafeer was launched with the backing of the Saudi Ministry of Water and Electricity, itself an advocate of reduction of consumption.
ACWA Power Projects is an owner and developer of infrastructure assets delivering water and power to cater for the rapidly increasing demand fueled by social and economic growth of nations. ACWA Power Project is an investor in Shuaibah IWPP and its expansion, Rabigh IWSPP, Shuqaiq IWPP, Marafiq IWPP, and Barge IWP, all of which are multibillion-dollar projects currently under construction. While each of these six projects is in a various stage of construction and shall achieve commercial operation between 2008 and 2010, once completed, they will produce a total output of 4,850 MW of power and 2.23 million m3/day of desalinated water.
ACWA Power Projects corporate social responsibility focuses on sustainable development sponsoring programs and initiatives such as Wafeer, an initiative launched by Tamkeen designed to reduce the consumption of water in industry. Wafeer was launched with the backing of the Saudi Ministry of Water and Electricity, itself an advocate of reduction of consumption.
ACWA Power Projects is an owner and developer of infrastructure assets delivering water and power to cater for the rapidly increasing demand fueled by social and economic growth of nations. ACWA Power Project is an investor in Shuaibah IWPP and its expansion, Rabigh IWSPP, Shuqaiq IWPP, Marafiq IWPP, and Barge IWP, all of which are multibillion-dollar projects currently under construction. While each of these six projects is in a various stage of construction and shall achieve commercial operation between 2008 and 2010, once completed, they will produce a total output of 4,850 MW of power and 2.23 million m3/day of desalinated water.
A consortium of Saudi and Malaysian companies will implement the project at a cost of SR 9,129 million (about US$ 2,434 millions).
Shuaibah Plant will export 194 million gallon of water per day (880,000 cubic meters) and 900 megawatt of power. This will supply the areas of Makkah, Jeddah, Al-Taif and Al-Baha.
This project is the first among a series of four projects in the sector of water and power co-generation projects (Shuaibah: phase-3, Shuqaiq: phase-2, Ras Alzour & Jubail: phase-3) which were approved by the Supreme Economic Council, and will be implemented with participation of private sector. The private sector will contribute 60% of the cost, Public Investment Fund 32% and Saudi Electricity Company 8%. Projects will be implemented on the basis of (Build, Own and Operate) with a total cost of more than SR 30 billion.
The combined export capacity of the four projects will reach 492 million gallons of water per day, (2.236 million cubic meters per day) and 4,500 megawatt of power. This export will boost the total desalinated water export capacity of the Kingdom by 80 percent. The implementation of the four projects will start with Shuaibah phase-3 and the commercial operation will begin in early 2009.
According to D Logic Data report, Shuaibah Project is the biggest co-generation project for production of water and electricity in the world in terms of the volume of debt to be provided to the project. It is also an important Saudi experience in promoting joint investments by domestic and foreign private sectors.
The Water & Electricity Company (WEC) was established in pursuance to the resolution of Supreme Economic Council which legislated the establishment of a limited liability company jointly owned by the Saline Water Conversion Corporation and the Saudi Electricity Company.
The four IWPP projects will meet the increasing demand of water and power of the Kingdom, in addition to compensating for desalination plants which would be decommissioned in near future. WEC will sell 100% water to Saline Water Conversion Corporation and 100% electricity to Saudi Electricity Company. The new projects will greatly contribute to economic and industrial growth of Saudi Arabia.
The preparation for this project has gone through several stages. It began with incorporation of the Water & Electricity Company, and then WEC appointed its Advisors (Technical Advisor: Fichtner GmbH & Co. KG of Germany, Legal advisor : The Law Firm of Yousef and Mohammed Al-Jadaan, in association with Clifford Chance of USA and the Financial consultant HSBC bank plc). The project included the scope of work for the developer, the project requirements and the estimated cost of the project according to its financial model as well as structuring the agreements needed for the project and the interrelations among parties of these agreements. It also covered ways of investment and finance, distributing risks among the parties, and the time schedule required for implementing the project.
WEC later made announcements in several Arab and global newspapers and magazines and asked the companies to participate in developing this project. 48 companies applied for participation and 11 developers were qualified for the project. The Request for Proposal (RFP) was issued on 31/7/2004G, and the bid submission was decided to be on 5/3/2005G.
Proposal Analysis Criteria :
The project documents included the complete proposal analysis criteria :
To achieve these criteria, WEC and its advisors prepared a financial model which enables WEC to ensure all elements of the project with their reasonable costs.
It is the first Independent Water and Power Project (IWPP) of this scale, in the world, using crude oil as the main fuel, while observing the international requirements for environment protection (as required by the international banks) by installing flue gas de-sulphurisation with a cost estimated to be 458 million Saudi Riyals.
It is worth mentioning that such vital and strategic projects have been offered to private (local and international) companies to implement on BOO basis. Saudi Electricity Company will construct power transmission lines, and the Government represented by the Ministry of Finance will provide the credit support required by the developer on behalf of Water & Electricity Co. Besides, there will be many privileges, incentives and concessions which will be granted by the Government for industrial activities.
The Water & Electricity Company, which has geared itself well to meet any need, has succeeded in presenting the project in such short time. About 48 companies and their consortia, specialized in the field of electricity and power production, have actually responded to the offer, and about 11 have been qualified and invited to bid.
Participation in Funding:
Regarding funding of this project, a group of local and international banks participated and worked jointly for the funding process. These are: Riyadh Bank
Syndication and underwriting are now underway where all Saudi Banks and 18 international banks are expected to participate.
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