Consortium Secures Major Water and Power Project in Kuwait
A consortium led by Saudi Arabia’s ACWA Power, in partnership with Kuwait’s Gulf Investment Corporation (GIC), has officially secured a significant contract to develop the Az-Zour North Phase 2 & 3 Independent Water and Power Project (IWPP) in southern Kuwait.
Agreement with KAPP and MEWRE
The consortium recently signed a Letter of Agreement with the Kuwait Authority for Partnership Projects (KAPP) and the Ministry of Electricity, Water and Renewable Energy (MEWRE). This collaboration marks the beginning of a transformative project that will stand as Kuwait’s largest integrated power and water facility.
Project Scope and Investment
The ambitious initiative is projected to have a net power generation capacity of at least 2,700 megawatts, alongside a desalination capacity of no less than 120 million imperial gallons per day (MIGD). The total investment for this monumental project is expected to surpass $4 billion, solidifying its significance in the region’s infrastructure development.
Leadership of ACWA Power
ACWA Power, headquartered in Riyadh, is recognized as the world’s largest private water desalination company and a pioneer in energy transition and green hydrogen initiatives. As the leading entity in this venture, ACWA will leverage its expertise, gained from a diverse portfolio of global projects, to ensure the project’s success.
Project Structure and Future Operations
Under a 25-year offtake agreement, the consortium will take on the responsibilities of designing, financing, building, operating, and maintaining the plant using a Build-Operate-Transfer (BOT) model. This model enables the consortium to establish a project company where it will hold 40% of the shares, with KAPP retaining the remaining 60%.
Notably, KAPP plans to allocate 50% of the company’s capital for public subscription by Kuwaiti citizens once the project becomes operational by 2029. Following its launch, the company is set to be listed on the Kuwait Stock Exchange.
Vision for Sustainable Development
Raad Al Saady, Vice Chairman and Managing Director of ACWA Power, highlighted the project’s importance, stating that it aligns with Kuwait’s broader development strategy. He expressed optimism about enhancing the reliable delivery of water and electricity while contributing to the nation’s efforts in energy transition and water security.
Economic Impact and Employment Opportunities
The Az-Zour North Phase 2 & 3 IWPP project is not only crucial for bolstering Kuwait’s electricity generation and water security infrastructure but also promises significant job creation. Employment opportunities will be available for Kuwaitis during both the construction and operational phases of the project, supporting local economic development.
Expansion of Capacities
This initiative marks the second phase of the Al-Zour project, which currently generates 2,700 megawatts and desalinates 120 MIGD. Upon completion of the new phases, these capacities are expected to double, further enhancing the region’s power and water supply.
GIC’s Commitment to Strategic Development
As a pioneer in Public-Private Partnership (PPP) infrastructure projects in the region, GIC has successfully developed and currently owns ten major infrastructure projects. Ibrahim Ali Al-Qadhi, CEO of GIC, emphasized the company’s pride in contributing to this landmark investment. He noted that the project would utilize cutting-edge technologies and adhere to the highest global standards in power generation and water desalination.
Meeting National Needs through Modernization
In a statement, KAPP highlighted that this venture is a critical step in addressing the increasing demand for water and electricity. It is designed to strengthen the national power network, ensuring readiness for future development initiatives. Furthermore, the project aims to engage the private sector in overhauling Kuwait’s infrastructure, leveraging its expertise to expedite execution and attract foreign investments.
By investing in modern solutions for power and water resources, Kuwait is taking significant strides towards ensuring sustainable growth and economic prosperity for its citizens.
