A consortium of Hyundai Heavy Industries (HHI) of South Korea and Sidem, a subsidiary of Veolia Water Solutions & Technologies, has announced the signing on 12 December 2013 of a US$ 1.4 billion engineering, procurement and construction (EPC) contract with Shamal Az-Zour Al-Oula to build the first phase of the Az-Zour North Independent Water & Power Project (IWPP) in Kuwait.
HHI, as the EPC consortium leader, will carry out the construction of the gas-fired 1,500 MW combined-cycle power-plant. Sidem, as EPC consortium partner, will construct a 107 MIGD (486,000 m³/d) multi-effect distillation desalination plant on a turnkey basis.
The capacity of Az-Zour North will account for around 10% of Kuwait’s installed power generation capacity and around 20% of its installed desalination capacity.
The consortium will complete the project approximately 100 km south of Kuwait City in the fourth quarter of 2016. Kuwait’s Ministry of Electricity & Water (MEW) will be the off-taker of power and water produced from the project under a 40-year Energy Conversion & Water Purchase Agreement.
The project is the first IWPP in Kuwait developed as part of planned long-term expansion of the power and water production capacity in the country and a pathfinder scheme for its public-private partnership programme.
HHI reports that competition among developers from Europe, Japan, Korea and the Middle East was tough. However, it says that a positive evaluation of HHI by MEW might have benefited the consortium, as the company handed over Kuwait’s previous Sabiya Combined Cycle Power Plant far earlier than the required schedule, enabling MEW to meet the challenging electricity demand during the summer peak load period of 2011.
Chun In-soo, chief operating officer of HHI’s Industrial Plant & Engineering Division said, “HHI, GDF Suez and Sidem have worked together on a wide range of projects in the Middle East. The synergy of our alliance will ensure this project is completed in time and on budget.”