January 19, 2007 / 9:16 PM / in 12 years

UPDATE 1-Mitsubishi, GIC and ACWA selected for Saudi project

(Adds quotes, detail, background)

By Haitham Haddadin

KUWAIT, Nov 11 (Reuters) - Japan’s Mitsubishi Corp. (8058.T) plus Gulf Investment Corp. (GIC) and ACWA Power Projects have been selected to build and operate a water and power project in Saudi Arabia, Kuwait-based GIC said on Saturday.

The consortium was selected as a preferred bidder for the project, which consists of a thermal power plant and a desalination plant and support facilities for the two utilities in the southwestern Saudi coast, a GIC statement said.

“WEC (Saudi Arabia’s Water and Electricity Co.) selected the consortium following a competitive tendering process,” the statement said, adding the tender received three bids from international consortia.

The Shuqaiq Independent Water and Power Project (IWPP) will be developed on a build, own and operate (BOO) basis and will increase power and water supplies to Abha and Jizan regions, added GIC, which is owned by the governments of Gulf Arab states.

The project is the second IWPP being developed by WEC and represents a major development in the Saudi water and power sector to help satisfy increasing demand in the desert kingdom, the statement added.

WEC, set up in 2003 and owned by Saline Water Conversion Corporation (SWCC) and Saudi Electricity Co. (SEC), will buy the project’s water and electricity then sell it to SWCC and SEC.

“The consortium and WEC intend to enter into a series of agreements including a 20-year power and water purchase agreement by this year’s end,” the statement added.

The project consists of a thermal power plant and a reverse osmosis technology desalination plant together with all support facilities such as fuel unloading and water intake and discharge structures, it added.

The complex will generate 850 megawatts of power and 47 million imperial gallons per day of water, it said.

Established in 1983, GIC provides financial services that support the development of private enterprise and economic growth in the region. It has assets of about $7.4 billion.

ACWA Power Projects owns and develops infrastructure assets to deliver water and power and is owned equally by three Saudi Arabian companies including a unit of Rajhi group of companies.

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