ACWA Power and Mitsui win tender for $630mn Salalah 2 IPP

Oman Power and Water Procurement Company (OPWP) has awarded a consortium of ACWA Power, Mitsui & Co and Dhofar International Development and Investment Holding Coompany (DIDIC) the contract to develop the Salalah 2 Independent Power Project (IPP).

Mitsui and ACWA Power will each hold a 45% stake in the project while the remaining 10% will be hold by DIDIC.

The scope of the Salalah 2 IPP includes design, construction, ownership, financing, operation and maintenance of a 445 MW high efficiency facility which will extend the current power capacity of 273 MW to 718 MW. The facilities will be located in Raysut, Oman. Under the contract the team will acquire Dhofar Generating Company (DGC), which owns and operates the 273 MW natural gas fired power plan, which has a 15-year PPA with OPWP.

The total project investment is estimated at US$630 million.

The project is expected to be operational by early 2018.

Paddy Padmanathan, President and CEO of ACWA Power stated

“Salalah 2 IPP is an important milestone for ACWA Power, given the importance of Oman as a strategic market. This transaction goes a long way in demonstrating our commitment to the socio-economic development of Oman, be it in reliably delivering low cost power and / or desalinated water, or in providing jobs for Omani citizens. ACWA Power is committed in maintaining a high level of Omanization, especially at the senior level positions, in its portfolio companies in Oman.”

Rajit Nanda, Chief Investment Officer at ACWA Power stated:

“We acknowledge the trust bestowed by OPWP upon ACWA Power in supporting Oman’s increasing demand for power and water, and we are proud to have offered a technically viable and a commercially competitive solution to provide the best value for money for OPWP on this transaction.”