$2bn deal to secure Bahrain energy supplies

POWER PARTNERS: A deal has been signed to help Bahrain cope with future energy demands. (Getty Images)

A consortium has signed a $2 billion deal for the development of the Al-Dur Independent Water and Power Producer (IWPP) which aims to help Bahrain cope with future energy demands.

The project will be built on the southeastern coast of Bahrain and will substantially increase power and water supplies in the Kingdom.

The Ministry of Finance awarded the consortium - made up of of French-based GDF Suez and Kuwait's Gulf Investment Corporation (GIC) - following an international competitive tendering process.

The project is the third IWPP being developed in Bahrain.

It will deliver electricity and water to the Electricity and Water Authority (EWA) under a 20-year agreement starting in June 2011.

The first phase will start in the summer of 2010, with full capacity being achieved in summer 2011.

The project consists of a Combined Cycle Gas Turbine power plant and a Reverse Osmosis (RO) technology desalination plant.

The complex will have a capacity of 1,234 megawatts of power and 218,200 cubic meters per day of water.

The initiative is expected to cost more than $2 billion, which will be funded by a mix of equity capital and project finance through a consortium of regional and international banks.

"The Middle East needs to build substantial additional power and water capacity and we have proven to be a reliable and competent partner to do so", said Dirk Beeuwsaert, GDF SUEZ Energy International's chief executive officer.

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