GDF Suez wins Abu Dhabi deal

Dubai: French energy group GDF Suez said yesterday it has won a power generation and water desalination project in Abu Dhabi as the emirate brings in independent operators to cope with the rising utility demand.

Located at Jebel Dhana, 250 kilometres west of Abu Dhabi city, the Shuweihat 2 plant will have a capacity to generate 1,500 megawatt of power and 100 million gallons per day of water.

Samsung Corp said it had a $810 million contract for the gas-fired power plant facility from Shuweihat 2 Holdings Company Limited, while Doosan Heavy Industries, another South Korean firm, said it won a $800 million order to build a water desalination facility for the project.

Suez owns 40 per cent of Shuweihat 2, with the remaining held by Abu Dhabi Water and Electricity Authority (Adwea), which had issued the tender.

Abu Dhabi Water and Electricity Company, an affiliate of Adwea, is the sole off-taker of the output in the plant under a 20-year power and water purchase deal with Suez, which will operate the facility.

Construction cost

Suez did not disclose the project's cost, but according to a stock exchange filing by Samsung the facility's construction cost is $2.15 billion.

Completion and start-up of Shuweihat 2 is scheduled for 2011, Suez said.

It said Abu Dhabi aims to raise power generation capacity by 35 per cent over the next five years, with demand for power rising by almost 80 per cent by 2012. Water demand is estimated to grow at five per cent per year.

Adwea is planning a similar project, Shuweihat 3, in the coming months, according to Suez.

Dirk Beeuwsaert, CEO of GDF Suez Energy International, said energy and water opportunities in the Gulf offer long-term off-take contracts. "With Shuweihat 2, we now have 10 plants in our Middle East portfolio, the majority combining power and desalination. They represent over 12,000MW of electricity and two million cubic metres of water per day," he said.

Abu Dhabi is pursuing a policy of independent water and power projects and has roped in foreign companies to build and operate utility facilities.