New firm to operate Umm Al Nar plant

A new company will be formed to operate and maintain Abu Dhabi's fourth independent water and power project (IWPP), the Umm Al Nar plant with two companies from the selected consortium taking equity.

Also, the consortium plans to sell the entire output to Adwea under a 23-year Power and Water Purchase Agreement (PWPA).

"The plant will be operated and maintained by an operating company (which will be owned 70 per cent by International Power and 30 per cent by TEPCO) under a long-term Operation and Maintenance contract for the entire term of the PWPA," said Crane, Chief Executive, International Power.

The total project cost (comprising the cost of acquisition and the cost of the expansion project) is estimated at $2.1 billion, which is to be funded by a mix of non-recourse project finance debt, shareholder equity, and cash inflow from operating the existing plant

The mandated lead arrangers for this financing plan, which comprises both conventional long-term and short-term debt, include Bank of Tokyo Mitsubishi, HSBC, Gulf International Bank, ING, Sumitomo Mitsui Banking Corporation, West LB, National Bank of Abu Dhabi and First Gulf Bank.

The project will also be supported by an Islamic loan facility, which will be arranged by Abu Dhabi Islamic Bank. Financial close is expected in June 2003.

The gas-fired Umm Al Nar plant has an installed capacity of 850 MW for power and is capable of producing 162 MIGD (Million Imperial Gallons per Day) of desalinated water.

Under the terms of the PWPA with Adwea, the consortium will also develop a new gas fired power and water plant adjacent to the existing plant. This new facility will have an installed power and water capacity of 1,550 MW and 25 MIGD, respectively.

The engineering, procurement and construction contract for the new plant has been awarded to Mitsui, with Toshiba and Hitachi Zosen as principal sub-contractors for the power and water plant respectively.

The new plant will be constructed using GE9FA turbines and Multi-stage Flash desalination technology. Construction will commence in the third quarter of 2003 and commercial operation is expected by mid-2006.

On completion of this new facility, seven of the existing (but relatively new) desalination units totalling 69.5 MIGD will be integrated with the new water plant, taking the total water capacity of the new plant to 94.5 MIGD.

In mid-2008, the remaining existing water and power units will be handed back to Adwea for decommissioning, leaving the final size of the Umm Al Nar plant at 1,550MW and 94.5 MIGD.

For a two-year period when the new extension and the existing power and water plants are running concurrently, the total contracted capacity at the site will be 2,200 MW power and 143 MIGD water.

As per the terms of the PWPA, fuel will be procured and paid for by Adwea.