Oman to issue RfPs for solar, power and water projects

By Conrad Prabhu — MUSCAT: MAY 21 – A Request for Proposals (RfP) is expected to go out in the fourth quarter of this year for the implementation of Oman’s first large-scale solar Independent Power Project, the Sultanate’s sole procurement utility revealed here yesterday. A 7-Year Outlook Statement unveiled by Oman Power and Water Procurement Co (OPWP) for the 2017-2023 timeframe also sets out a strategy for the implementation of a number of gas-based electricity and water desalination schemes over this period.
It includes plans for the procurement of a handful of Independent Power Projects (IPPs) providing around 2,400 MW of new gas-based capacity, and a raft of new Independent Water Projects offering a total of over 800,000 cubic metres/day of new desalination capacity. Importantly, future procurement initiatives may include additional solar or wind IPPs, a gas-fired IPP for service in 2024, and the first coal-fired IPP for operation beyond 2024, subject to government approval, the state-owned utility — part of Nama Group — stated.
Commenting on its plans to support the introduction of commercial-scale renewable energy generation in the Sultanate, the utility said: “OPWP plans to procure Oman’s first large-scale solar IPP in 2017. Technical advisers have been engaged to develop tender documents and an appropriate evaluation methodology that assures a cost-effective project without subsidy. OPWP expect to issue the RFP in Q4 2017, for capacity of at least 200 MW, to be operational by 2020.”
The move comes as OPWP is faced with burgeoning electricity demand projected to grow at the rate of about 6 per cent annually from 5,920 MW in 2016 to 8,960 MW in 2023. “This growth rate, lower than previous forecasts, reflects economic trends and the introduction of cost reflective tariffs to large consumers. Energy consumption is expected to grow at 7 per cent per year,” the procurer said. Also set to be issued around mid-year is an RfP for a new IPP planned at Misfah in Muscat Governorate. The proposed 800MW power project is slated for commercial launch in January 2020.
Later this year, OPWP also aims to kick-off the procurement process linked to the development of at least around 1,600 MW of new power generation capacity at an unspecified location within the Main Interconnected System (MIS), covering the northern half of the Sultanate. The new IPP is planned to be brought on stream in 2022. Tendering for the project will be governed by a new procurement methodology that allows existing, out-of-contract to compete for new power and water contracts along with bidders for the new plants.
On the water side, demand growth is projected to be significant, in response to which OPWP has formulated a substantive procurement plan. Around half a dozen new Independent Water Projects (IWPs) are planned in various parts of the Sultanate over the 2017 – 2023 timeframe. Notable is a new desalination plant planned in Al Ashkarah in Al Sharqiyah South Governorate, with a capacity of 80,000 m3/day (equivalent to 17.6 million imperial gallons per day MIGD). Bids for the project were already received in Q4 2016 with an award likely to be announced shortly, according to OPWP.
Seeking to satisfy growing demand in the capital region, the procurer plans to initiate the procurement in Q4 2017 of a new IWP of around 300,000 m3/day (66 MIGD) capacity as part of the Ghubrah water desalination cluster.  Dubbed Ghubrah III IWP, the plant is slated for commercial launch in 2022.
Also envisaged is a first-ever IWP in North Al Batinah Governorate of a capacity of 200,000 m3/day (44 MIGD). An RfP for the project will be released in Q4 2017, with commercial operation set for 2022.  Likewise, in Dhofar Governorate, OPWP foresees the potential for a new 100,000 m3/day (22 MIGD) capacity IWP to come on stream in 2022.  Initial procurement efforts for this project are likely to begin this year.
The new Dhofar Water 2022 project, as it currently called, comes on top of the Salalah III IWP, an award for which is expected shortly.  Salalah III IWP will offer 100,000 m3/day (22 MIGD) of capacity and is expected to come into operation in January 2020.
Two new modest-sized IWPs are envisioned in Khasab and Duqm, procurement of which is already under way.
The Khasab IWP, with capacity of 16,000 m3/d (3.5 MIGD) using RO technology, is under procurement, with anticipated launch in Q1 2021. Bidder pre-qualification began in Q4 2016, and the RfP is expected to be released during Q2 2017.  For the Duqm IWP, featuring 60,000 m3/day (13.2 MIGD) of capacity, bidders have already been pre-qualified pending the release of an RfP.  The project is currently “on hold pending government review”, according to OPWP.