We have covered key developments in PPP and infrastructure across OMAN, QATAR and KUWAIT in our latest insight for Q2-2024. There are active projects under development via PPPs with participation from international developers across clean energy, transport and urban infra sectors. Further, we also see development of innovative financing solutions, including a large green bond issuance by Qatar.
Read the key developments in Infrastructure and PPPs in key GCC countries in our latest insight of the Q2 2024 series.
April 2024
GREEN HYDROGEN DEVELOPMENT PROJECTS IN OMAN ARE WON BY ACTIS AND EDF TEAMS.
Oman has allotted green hydrogen projects to two teams— first team include UK asset manager Actis & Australian energy giant Fortescue, and the other team is led by EDF Renewables, Japan’s J-Power, and UK hydrogen developer Yamna. This comes under the second round of Oman's green hydrogen tender, the project was put out by Hydrom, the Omani government organization responsible for implementing the national hydrogen strategy.
First project consists of Installing electrolysers with the capacity to generate up to 200,000 tons of green hydrogen annually, along with installation of 4.5 GW of wind & solar projects in the governate of Dhofar. The second project consist of a 2.5 GW electrolyser, it will produce 1 mtpa of green ammonia and 4.5 GW of solar & wind power, this project will be constructed in Salalah Free Zone.
In 2023, a group led by Copenhagen Infrastructure Partners (CIP) emerged winner in the first round of bidding, winning a 4.5 GW hydrogen project in the town of Duqm. In addition, Hydrom granted a 4 GW project to a consortium supported by Shell and a 3.5 GW project to the UK oil company BP.
A CONTRACT FOR THE 303 KM UAE-OMAN RAIL LINK WAS AWARDED.
A consortium led by German rail signalling and rolling stock producer Siemens Mobility and its local partner Hassan Allam Construction will construct a new 303 Km Oman-Etihad railway line in the Gulf region. The joint venture has been tasked to construct the East-West rail project, which will connect the countries of the Gulf Cooperation Council, from Abu Dhabi to Sohar.
Design, construction, and integration of the ETCS Level 2 signalling, telecom, and power supply systems for the first line of the rail network project will be handled by the consortium. The Oman-Etihad Rail is jointly owned by the Governments of Oman and the United Arab Emirates and is expected to cost USD 3Bn. The rail line will link the Omani port city of Sohar with the UAE National Railway network, which presently links the 7 emirates of the UAE.
UAE AND OMAN ESTABLISH US 35 Bn INVESTMENT PARTNERSHIPS.
Investment partnerships of AED129 Bn (USD 35.12 Bn) have been formed between the UAE and Oman in several industries, including technology, green metals, railways, and renewable energy. The two nations will establish a Dh117 Bn (USD 31.85 Bn) industrial and energy megaproject that will include wind and solar power plants as well as green metal production facilities. Additionally, the two nations agreed to establish an AED 660 Mn (USD179.69 Mn) technology-focused fund to finance investments in Oman's and the wider Mena region.
OFFICIALS FROM OMAN ESTABLISH ECONOMIC TIES WITH THE US, JAPAN, AND SAUDI ARABIA.
Oman’s new agreement with Saudi Arabia, US and Japan is expected to strengthen Oman's industrial infrastructure and encourage private-sector involvement in the nation's economic progress. The MOU is aimed at financing the infrastructure of several industrial zones in Oman, the goal is to develop the industrial and logistical sectors by providing all required basic services, thereby encouraging the private sector to contribute to Oman’s economic development in line with Oman Vision 2040.
This memorandum will support the developmental areas including infrastructure, higher & vocational education programs, and water, along with the industry & mining sectors. Additionally, it includes transportation and communications sectors, as well as developmental projects in the energy sector.
May 2024
THE OMAN BUSINESS GATEWAY (SOCIAL PPP) PROJECT HAS SHORTLISTED SIX COMPANIES
The Oman Business Gateway project's Request for Qualification (RFQ) tender results were made public by the Ministry of Finance. Six companies have been shortlisted for the development of this vibrant commercial hub in Muscat and it include Alghanim International General Trading & Contracting Company, Galfar Engineering & Contracting Company, Plenary Middle East Limited, Amjaad Group, Bouygues Batiment International, and Muscat National Development & Investment Company (ASAAS) for the project's infrastructure development. The winning bidder will take responsibility for the Oman Business Gateway's comprehensive design, finance, development, and operation.
This Project will build under PPP model and its objective is to develop a thriving, commercially oriented hub with a range of mixed-use assets including retail establishments, hotels, offices, and residences among other commercial properties. Project also include the development of the new the Ministry of Commerce, Industry, and Investment Promotion (MoCIIP) Headquarters, which will accommodate all ministry and its departmental staff and occupy roughly 30,000 sqm.
MANAH SOLAR PV PLANTS IN OMAN WILL BE SUPPORTED BY A NEW GRID STATION.
Trade Links & Services (TLS), a local electrical contractor, has successful commission new 400-kilovolt grid station at Manah for the Oman Electricity Transmission Company SAOC (OETC). Constructed at a cost of RO 13 Mn (USD 33.58Mn), this grid station will facilitate the transmission of renewable energy generated by the Manah Solar I IPP and Manah Solar II IPP, which are currently being built in the Wilayat of Manah.
The output from these two solar plants will boost the supply of renewable energy and reduce the reliance on fossil-fuel-based energy. The new grid station is interconnected with Nahada and the new Izki grid station via 400 KV double circuit transmission lines.
GREEN BONDS OF USD 2.5 Bn ARE ISSUED BY QATAR.
Qatar has issued USD 2.5 Bn worth of green bonds in two tranches: USD1 Bn in five-year offers with a yield 30 basis points higher than US Treasury bonds and USD1.5 Bn in ten-year debt with a yield of 40 basis points higher than US Treasury bonds, according to the IFR report. More than USD14 Bn in subscriptions were requested overall, which is more than 5.6 times the amount of issuance.
This indicates a broader and more varied level of interest from institutional investors. The aim of the bond issuance is to fund projects to reduce carbon and other planet -warming emissions. To structure the green finance framework and the bond issuance, Credit Agricole, HSBC, JP Morgan, and QNB Capital were chosen as the coordinators and principal issuance managers.
June 2024
EOIS ARE REQUESTED FOR THE REDEVELOPMENT OF OMAN AIRPORTS.
Expressions of interest are being invited by Oman Airports Management Company (OAMC) for the redevelopment, operation and management of the Old Terminal of Muscat International Airport. The Project is to be developed under build-operate-transfer (BOT) model. As per the plans, the former airport terminal building in Muscat is to be redeveloped into a multipurpose facility that will house an aviation museum showcasing the nation's aviation history.
IBRI III SOLAR PV PROJECT HAS NINE PREQUALIFIED BIDDERS.
The Nama Power and Water Procurement Company (PWP), the sole purchaser of power and water outputs in the Sultanate of Oman, has announced that nine foreign companies have prequalified for the competitive tender to take part in the 500 MW Ibri III Solar PV project. The companies that have prequalified include
Abu Dhabi Future Energy Company (Masdar),
ACWA Power, Al Riyadh National Trading,
Korea Midland Power (KOMIPO),
Jinko Power,
Sembcorp Utilities,
TotalEnergies Renewables,
EDF Renouvelables,
Korean Western Power (KOWEPO),
International Power SA (Engie), and
Sumitomo Corporation.
The Ibri III Solar PV project is estimated to cost OMR 155 Mn (USD 402.64 Mn) and it is the fourth major solar project to be developed in Oman. The project will be implemented following the successful precedent IPP model that Oman has established. It will involve a fair and transparent competition process with the goal of awarding the contract to a highly qualified private sector developer in order to deliver world-class technology solutions.
TEN AGREEMENTS WERE INKED FOR OMAN'S TOURISM PROJECTS.
Ten contracts under the Oman’s usufruct system were signed by the Ministry of Heritage and Tourism to develop projects in various wilayats and governorates of the Sultanate of Oman. Project cost is expected to be OMR 6 Mn (USD 15.59 Mn) and include
A 3-star hotel and a tourist rest house in the Wilayat of Salalah.
A tourist camp in the Al-Khudf area of the Wilayat of Thumrait in the Dhofar Governorate.
A three-star tourist resort in the Wilayat of Shalim and the Al-Halaniyyat Islands in the Dhofar Governorate.
A 3-star hotel, an adventure center, and a luxury tourist camp in Barkat Al-Sharaf.
A tourist camp in the Wadi Mastal,
A tourist camp in the Wilayat of Nakhal in the South Al Batinah Governorate.,
A 3-star resort in Misfat Al Abriyyin in the Wilayat of Al Hamra in the Al Dakhiliyah Governorate.
A tourist camp in the Wilayat of Jaalan Bani Bu Ali in the South Al Sharqiyah Governorate.
The project will increase the supply of hotel rooms and facilities in the Oman tourism sectors, as per the Oman’s comprehensive tourism development plan.
QATAR PLANS TO BUILD A SIMAISMA THEME PARK FOR USD 5.5 Bn.
Qatar plans a new QAR 20 Bn (USD 5.5 Bn) tourism project. It includes amusement park (in a 160 acres) that is expected to surpass Walt Disney Co.'s Magic Kingdom (in a 100 acres). Whole Simaisma project would cover 8 Mn square meters (1,976 acres) with 7 km of beachfront land, and it will be situated around 40 minutes north of Doha, the capital of Qatar.
Along with residences and shops, the project is expected to include an 18-hole golf course surrounded by 300 villas, luxury resorts, a marina and a beach club. The government has assigned Qatari Diar Real Estate Investment Company, a nation's sovereign wealth fund division, to oversee the project's development.
This development is a part of Qatar's long-term ambitions to become a vacation destination. Qatar wants the tourism sector to contribute 12% of the nation's GDP by 2030.
QATAR WILL BUILD A USD 275 Mn SALT MANUFACTURING FACILITY.
Qatar plans to build new salt production and processing facility in the Umm Al Houl area of Qatar. This project is a joint venture between Mesaieed Petrochemical Holding Company (MPHC), Qatar Industrial Manufacturing Company (QIMC), and other key stakeholders. It is to be develop under QatarEnergy’s TAWTEEN programme, that encourage local manufacturing of goods to fulfil domestic demand and also increase the export of goods.
The facility project to cost USD 275 Mn (QAR 1 Bn) and have processing capacity of 1 Mn tons per annum which will replace currently imported 850,000 tons of industrial and table salts. The facility will use reject water recovery from the reverse osmosis (RO) desalination plants and also generate bromine, potassium chlorides, and demineralized water for a variety of product streams.
April 2024
EGIS AND GULF CONSULT WIN PROJECT FOR RECONSTRUCTION AND REVITALIZATION OF THE SOUK AL-MUBARAKIYA IN KUWAIT CITY.
A consortium of Egis and Gulf Consult has been hired to assist with the renovation and redevelopment of Kuwait City's Souk Al-Mubarakiya. The project aims to completely renovate Kuwait City's historic marketplace, which has served as the hub of daily activities for more than a century.
The Souk Al-Mubarakiya was devastated during the 1990 Iraqi invasion of Kuwait. The Kuwaiti Bank- Kuwait Finance House (KFH) is leading the restoration effort, with construction managed by Alghanim and consulting services provided by Egis and Gulf Consult. Egis has been contracted to rebuild 17 buildings and is tasked with leading an extensive upgrade of the infrastructure network in the surrounding area and Egis is also working with architecture and heritage specialists in the predesign and design project management phases.
KUWAIT MINISTRY HAS AWARDED MITSUBISHI POWER A MAJOR CONTRACT TO UPGRADE AZ-ZOUR SOUTH POWER STATION.
The Kuwait Ministry of Electricity, Water & Renewable Energy awarded Mitsubishi Power a contract for the optimization and rehabilitation of eight units at the Az-Zour South Power Station. This project will recover the capacity for steam generation, improve grid reliability, and meet Kuwait's expanding power needs. Mitsubishi Power is also giving innovative technological solutions for lower emissions of particulate matter (PM) and nitrogen oxide (NOx).
This extensive restoration project aims to reduce greenhouse gas emissions and increase boiler efficiency by replacing old, degraded boiler components with new, upgraded ones and optimizing boiler operation by upgrading combustion and control systems. Built in the 1980s, the 2,400 MW Az-Zour South Power Station is regarded as a key pillar and a cornerstone of Kuwait's energy industry.
KUWAIT BEGINS TO CONSTRUCT A USD 649 MN LOGISTICS HUB AT SHUWAIKH PORT.
The Kuwait Ports Authority (KPA) begin to construct an integrated logistics city at Shuwaikh Port, with an estimated cost of KWD 200 Mn (USD 652 Mn). Scheduled for completion by 2028, the project will feature multi-story warehouses, administrative buildings, support services, and exhibition halls.
This new logistics hub at Shuwaikh Port will enable the port to accommodate larger vessels, enhance container handling and storage, and expand re-export capacity from Kuwait to other ports. The project aims to improve Kuwait's trade and logistics capabilities by upgrading essential maritime infrastructure, attracting international investors, and increasing revenues.
Additionally, the Kuwait Ports Authority (KPA) intends to leverage this project to support SMEs involved in foreign trade and logistics.
KUWAIT RELEASES THE REQUEST FOR PROPOSALS FOR THE AZ-ZOUR NORTH 2 AND 3 UTILITY PROJECT.
The Kuwait Authority for Partnership Projects (KAPP) has issued the requests for proposals (RFPs) to all five qualified bidders for the development of the Az-Zour North Phase 2 and 3 IWPP, a major utility project, Bidding consortiums include:
Abu Dhabi energy company Taqa with partners AH Al Sagar & Brothers, a Kuwaiti group with interests in power, oil and gas, and petrochemicals and Japanese power company Jera
Saudi-based utility major Acwa Power with Kuwait-based Gulf Investment Corporation
China Power International Holding with Malaysian group Malakoff International and Saudi-based Abdul Aziz Al Ajlan Sons Company
Nebras Power, a Qatar-based power development company, and
Sumitomo Corporation, a Japanese trading company engaged in diverse businesses, including construction systems and infrastructure.
This initiative is in collaboration with the Kuwait’s Ministry of Electricity & Water & Renewable Energy (MEWRE). The Az-Zour North Phases 2 and 3 of Kuwait's independent water and power plant (IWPP) will be powered by a combination of high-pressure natural gas and liquified natural gas, with gas oil serving as a backup fuel source.
When finished, it will produce at least 120 Mn imperial gallons of desalinated water per day (MIGD) and a minimum of 2.7GW of power. The selected bidder will sign the PPP agreements with the related parties, which would extend up to 27 years and 8 months, The project scope involve financing, design, construction, operation, and maintenance services, followed by the transfer of the plant to KAPP for its management.
May 2024
KUWAIT OIL COMPANY AND MINISTRY COLLABORATE ON A 1 GW SOLAR PROJECT
Kuwait Oil company has signed a MOU with the Ministry of Electricity, Water and Renewable Energy for 1 GW of solar power to diversify the energy portfolio and cut carbon emissions. This power output is equivalent to 6 % of Kuwait’s total power generation capacity.
The agreement aims to remove barriers related to the development of renewable energy projects by promoting cooperation and coordination between the ministry and the enterprise. With this project Kuwait will satisfy the fast-rising demand and diversify its energy sources, for which it presently relies exclusively on fossil fuels. Kuwait has plans to increase the percentage of renewable energy generation to 15% by 2030 to diversify its energy basket.
KUWAIT’S DGCA HAS RECEIVED APPROVAL TO OPEN BID FOR THE NEW KUWAIT AIR CARGO CITY PROJECT.
The Fatwa and Legislation Department has granted approval to the Directorate-General of Civil Aviation to open bidding for the new Kuwait Air Cargo City project. This project includes the design, construction, management, operation, maintenance, renovation, and development of facilities for cargo handling, storage, and distribution at Kuwait International Airport.
The bidding process is restricted to specialized international companies due to the project's strategic importance. The bidding period will span 20 years, during which the chosen global operator will seek investment opportunities at the airport to maximize financial returns for the General Administration of Civil Aviation.
Several investment projects are planned for the new air cargo city, including maintenance and repair zones, shipping facilities, express shipping buildings, government offices, customer service areas, parking lots, a railway, support service structures, and multi-storey parking garages. These initiatives aim to boost air cargo traffic, provide value-added logistical services, and attract global logistics branches of multinational companies, thereby positioning Kuwait International Airport as a leading logistics hub in the Middle East and North Africa region.
June 2024
KUWAIT AWARDS ROAD INFRASTRUCTURE CONTRACT OF USD 565 MN IN SABAH CITY.
The Kuwait’s Public Authority for Housing Welfare (PAHW) has given contracts worth KD173.5 Mn (USD 565.64 Mn) for the building of roads and other infrastructure works for 13,812 residential units in the South Sabah Al Ahmad City, which is 80 km south of Kuwait City.
China State Construction Engineering Corporation Limited was given the first contract, worth KD93.7 Mn (USD 305.48 Mn), to build and maintain the road and infrastructure networks for 7,623 residential units in the suburbs N5, N7, N9, and N10. Sinohydro Corporation won the second contract worth USD 260.16 Mn for infrastructure work for 6,189 residential units in the suburbs of N4, N6, and N8. Both the lowest bidders are Chinese companies.
The scope of work includes the implementation of networks for rainwater, sewage, irrigation, treated water, and fresh water, as well as the necessary traffic works for the project. Additionally, it involves the construction of civil works for telephone networks, road lighting, electrical cable crossings, irrigation tank buildings, and substations.
DAR SECURES THE CONTRACT FOR CONSTRUCTION SUPERVISION AND AIRPORT DESIGN IN KUWAIT.
Kuwait's Directorate General for Civil Aviation (DGCA) (KIA) has reached an agreement to redevelop Kuwait International Airport's infrastructure. Dar Al-Handasah Design and Technical Consultation Company, located in Beirut, has received the five-year contract for design and construction supervision. It includes a 1.5-year design phase and a 3.5-year construction supervision phase.
The project consists of four components, each essential for transforming Kuwait's main aviation gateway:
Upgrading the central runway and associated taxiways to a length of 4,300 meters, meeting ICAO code 4F standards with a precision approach CAT III B,
Upgrading the cargo apron finishing, that involve expanding the cargo apron to 1.5 square kms, designed to accommodate 77 aircraft stands, to meet future logistical demands,
Establishing a new VVIP (AMIRI) Apron with dedicated aircraft stands and a run-up area for distinguished guests,
Developing airport support infrastructure to enhance the capacity of existing facilities and meet future needs, including transportation and utility services.
THE KUWAIT CENTER FOR NEPHROLOGY AND KIDNEY TRANSPLANT OPENS.
The Ministry of Health announced the official opening of the state-of-the-art specialized centre. It provides patients in Kuwait with specialized high-quality care. The Center is located at the Al Sabah Hospital Complex in Shuwaikh and is an expansion of the Hamid Essa Hospital, also called the Organ Transplant Center. There are 4 ICU beds, 13 dialysis beds, 11 isolation rooms, and 83 inpatient beds.
With assistance from the Ministry of Health, the centre was constructed with the funding provided by private donations. Its design prioritises patient well-being and comfort with soothing architectural aesthetics and colours.
KUWAIT AWARDED USD 102 MN 400KV SUBSTATION CONTRACT TO NCC.
The contract for the building of the 400/132/11kV substation in the South Sabah Al-Ahmad residential project was signed by the Public Authority for Housing Welfare (PAHW), Kuwait with the Saudi Arabia's National Contracting Company (NCC). The project involves the design, procurement, construction, testing, commissioning, and maintenance of 400/132/11kV substations in the residential city of Al-Ahmad, South Sabah.
List of key transactions - Oman, Qatar and Kuwait Q2 2024
Source: YOG INFRA analysis
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