Muscat: All power generation and water desalination companies in Oman are set to be privatised by 2009.
An agreement yesterday, for a project that includes the first privatisation of Oman's electricity and related water sector restructuring process under a Share Purchase Agreement, signalled the start of the privatisation process in earnest.
The Omani government has early 2008 timeframe for privatising all transmission operations and the distribution and supply companies within the next three years.
Oman's Minister of National Economy and Deputy Chairman of Energy Resource Council, Ahmad Bin Abdulnabi Macki, with other senior official officially signed the AI Rusail/Birka II project with the preferred bidder, the Suez Tractebel, Abu Dhabi-based Mubadala, Development and National Trading Company consortium.
"This agreement marks a new milestone for the sector, one of the largest and the most important industries operating under the Sultanate's policies of privatisation," said Mohammad Bin Nassere Al Khusaibi, Chairman of the Electricity Holding Company.
The AI-Rusail-Birka II project has two elements; the privatisation of Al Rusail Power Company and also the development, ownership and operation of a new power and desalination project at Birka (IWPP) under a Build, Own and Operate basis (BOO). This marks the first IWPP to be awarded following the promulgation of the Sector Law in August 2004, as well as the first privatisation of an existing power company by way of a 100 per cent share sale.
The now privatised AI-Rusail Power Company is a natural gas fired 668MW open cycle plant consisting of eight Fram 9E units. It is located approximately 40km west of Muscat and is connected to the main interconnected transmission system at 132 kV.
It has now been just over a year since the Ministry of National Economy transferred the electricity and water related assets, responsibilities and staff of the Ministry of Housing Electricity and Water to ten successor companies.
"During the restructuring process and the privatisations to come, the safeguarding of sector employees has been one of the key objectives," says the press release.
