PPP sewage treatment plants

By Davis Thattil | Dec 31, 2017
Water & Electricity (WEC) has invited companies to submit expressions of interest for two major sewage treatment plants (STPS), which will be developed under a public-private partnership (PPP) model. Two independent sewage treatment plant (ISTP) projects have been identified and placed for public bidding.

For the first project, WEC is planning to oversee the development of a 330,000 cubic meters a day (cm/d) independent sewage treatment plant (ISTP) in Dammam. The project will be developed under a 25-year sewage treatment agreement (STA), under which the sewage capacity will be provided by the National Water Company (NWC). WEC’s obligations under the STA will be guaranteed by a credit support agreement from the Saudi government.

The second planned project is the Jeddah Airport 2 ISTP, which will have a total treatment capacity of 500,000 cm/d. The new ITSP will be located adjacent to the existing 350,000 cm/d Jeddah Airport STP. WEC is also considering linking the new STP with the potential acquisition, refurbishment, operation and transfer of the existing JA1 STP, owned by NWC, in with the planned ISTP. As with the planned Dammam ITSP, the successful developer will develop the project/bundle under a 25 year STA with WEC, under which the sewage capacity will be provided by NWC.

The Jeddah Airport 2 project has faced a number of delays, having already twice been tendered under the EPC model. The project was originally tendered in 2012, but faced numerous delays as the client reconsidered the size and procurement model for the scheme. The STP was retendered as an EPC project in 2015, with the deadline for proposals postponed several times until December 2016. However, the client has now decided to move ahead with the project either as a PPP scheme.

The advisory team working on the Dammam and Jeddah Airport 2 ISTP projects will be led by Japan’s Mizuho Bank, financial adviser, and will also include UK-based Atkins, owned by Canada’s SNC Lavalin, technical adviser, and US-based law firm White & Case as legal adviser. MEED reported in September that the advisory team had been selected for a handful of planned PPP sewage treatment plants and related projects.

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