Indian, US, Japanese firms race for projects in the UAE
Over 116 companies from 15 countries, including India, are in the race for acquiring two high- profile utilities projects in Ras Al Khaimah emirate in the UAE
It is an unprecedented participation for independent water and power projects in the Gulf country.
Companies from the US, Europe, Japan, China, India and the Middle East are in the race for the projects, with GDFSuez, Elf Energy, Abengoa (which has built Shams Energy), and ACWA Power among the top international bidders.
The tender is expected to be wrapped up in the third quarter of this year. It calls for the construction of a water desalination plant which will deliver an output of 22 million gallons per day and a power plant that will generate 40 MW per hour once operational.
The tender pre-qualification process is being managed by Latham and Watkins and features independent auditors and finance advisers and management consultants.
The projects are being developed on a 20-year guaranteed off-take agreement by Utico, the region’s largest private utilities company.
As per the terms of the contract, 40 per cent will be funded by the successful bidder, with the remaining 60 per cent being funded by Utico.
The projects are being developed to meet the rapid growth of Ras Al Khaimah and surrounding emirates.
The projects are modelled to set a precedent for the UAE, resulting in lowering or completely wiping out subsidies as prevalent along with lowering consumer pricing.
Richard Menezes, Utico’s Vice Chairman, said that energy management was not a target audience or government problem, but is also an entire value chain holistic initiative that eventually only benefits the consumer paying the bill.
“Total participation is the only answer, starting from the government to the consumer and everything in between,” he said.
The solar independent power project will provide power to the desalination plant as well as provide power to the Utico grid.
Negotiations are also underway to connect to the federal grid, which will help Utico to increase the solar power capacity to 120 MW over the coming years.