Algal bloom affects water production

Muscat – ACWA Power Barka said that the production of water from RO-1 and RO-2 Expansion plants were affected due to algal bloom prevailing in the sea. The financial impact to date amounts to RO140,000.

In its Muscat Securities Market (MSM) filing, the company said during the algal boom period, the level of  pollutants in the seawater exceeded the technical limits as defined in the Water Purchase Agreements (WPAs) of the two expansion plants.

The company and its operator are closely monitoring these levels and and increased chemical doses to the maximum to keep the two plans partially operational until the seawater quality returns to the acceptable limits and the production is fully restored.

The situation is defined as the Seawater Quality Failure in the respective WPAs and once established is a Force Majeure Event.

Pursuant to the WPAs during the Force Majeure Event:

1. The company will get relief from liability for any consequent failure to perform its obligations.

2. Oman Power and Water Procurement (OPWP) will not pay for the water capacity, which the company could not make available during this Seawater Quality Failure period.

3. The terms of two WPAs will be extended beyond December 31, 2021 for a period equal to the period during which the company was unable to provide the required capacity –  the water capacity charged not by paid by OPWP in item two above will be recovered at the end of 2021 .