Deadline for power proposals released

Companies have until 27 August to submit bids for the development of the Yanbu Independent Water and Power Project (IWPP) in Saudi Arabia.

  arabianbusiness.com/web/power_thumb.jpg - YANBU PROJECT: proposal request is out now.
arabianbusiness.com/web/power_thumb.jpg - YANBU PROJECT: proposal request is out now.

Companies have until 27 August to submit bids for the development of the Yanbu Independent Water and Power Project (IWPP) in Saudi Arabia.

Thamer S Al-Sharhan, president and CEO of Power and Water Utility Company for Jubail and Yanbu (Marafiq) released a Request for Proposals (RFP) for the project last week.

This is the second IWPP project that is being tendered by Marafiq, with the first being the Jubail IWPP, which achieved financial close last June.

"The issuance of the RFP for Yanbu IWPP represents a major step forward in the development and privatisation of the Kingdom's water and power sector," said Al-Sharhan.

"The RFP is the product of significant work by various organisations in the Kingdom and has the full support of the Government of the Kingdom of Saudi Arabia. This is also a reflection of the strong economy that the Kingdom is experiencing."

Marafiq has issued the RFP to pre-qualified bidding groups to select a developer or a developer consortium to own 60% of a special-purpose project company that will build, own, operate and transfer (BOOT) the 1,700 MW and 150,000m3 of water per day.

The remaining 40% of the shares in the project company will be held by Marafiq.

The project company will sell its entire capacity and output to a new off-taker company in Yanbu that is 100% owned by Marafiq. This will be done under a 25-year Power and Water Purchase Agreement with structured credit support from the Ministry of Finance.

"We are pleased to see keen interest by the bidding groups for the project and look forward to receiving competitive bids", added Al-Sharhan.

Marafiq's owners are the Royal Commission for Jubail and Yanbu, Sabic, Saudi Aramco and the Public Investment Fund, each holding 24.81%. The remaining 0.76% is held by private investors.

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