International Power and CMS win Abu Dhabi contract

The Abu Dhabi Water & Electricity Authority Tuesday awarded a 20-year contract for the $1.6 billion Shuweihat S1 power and desalination project to a joint venture between CMS Energy Corp. and the UK’s International Power PLC.

The project was won in a competitive bid process. The Shuweihat project, which will be Abu Dhabi’s largest independent water and power plant, includes a gas-fired 1,500 Mw combined cycle power plant and a large water desalination facility with a capacity of 100 million imperial gpd.

It will be built on a green field site close to Jebel Dhana, 250 km west of the city of Abu Dhabi. The water and electricity authority will hold a 60% interest in the project with CMS Energy, Dearborn, Mich., and International Power jointly holding the remaining 40%. CMS Energy and International Power will also jointly operate the facility under a 20-year operations and maintenance agreement.

Gas for the project will be supplied by the Abu Dhabi National Oil Co. on a pass-through cost basis, a CMS spokesman said.

Joseph P. Tomasik, vice-president and managing director of CMS Energy, UK, said the contract positions CMS for future strategic opportunities in the region. Construction on the site is scheduled begin in spring of 2002, with commercial operation expected by summer of 2004.

An engineering, procurement, and construction contract to build the plant has been awarded to a consortium of Siemens AG and Italy’s Fisia Italimpianti SPA, CMS said. The financing for the project is being arranged by Barclays Capital, Citibank, NA., Abu Dhabi Investment Co., Bank of Tokyo-Mitsubishi, Kreditanstalt fur Wiederaufbau, National Bank of Abu Dhabi, and Royal Bank of Scotland. Financial closing is scheduled for November of this year.

The Shuweihat project is CMS Energy’s second entry into Abu Dhabi, following the 710 Mw, 50 million imperial gpd Al Taweelah A2 power and desalination plant, located on the coast of the Arabian Gulf, in which CMS holds a 40% ownership interest.

The Al Taweelah A-2 power facility is operating and the desalination units are expected to be completed and fully operational by September of this year, CMS said.

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