KUWAIT plans to issue a new tender this month to build a power plant which it expects will now cost far less than earlier estimates in excess of $2.4 billion.

Assistant undersecretary at the Ministry of Electricity and Water Khaled Al-Wasmi said that the six firms previously pre-qualified to bid to build the 2,000-MW Subiya plant will be invited to reapply.
“I expect the new tender to be issued during the first or second week of April. Due to the economic situation and global recession, the cost is expected to fall significantly,” he said.
Bidders and the government have so far failed to reach a deal over shouldering the hedging risks for the plant as banks showed little appetite for the transaction, which was offered in Kuwaiti dinars, sources familiar with the deal had earlier told Reuters.
Al-Wasmi said that the quotation for the tender will be valued now as 60 per cent in international currencies such as the euro, yen or US dollar, with the remainder in dinars.
He said that initial bids for the plant, which is due to come on stream in 2011, ranged from KD760.69 million ($2.65 billion) to KD930.47 million ($3.189 billion). The six pre-qualifiers included Germany’s Siemens, US’ General Electric Company, Japan’s Mitsui & Company and Marubeni Corporation, Spain’s Iberdrola Ingenieria Y Construction and Canada’s SNC-Lavalin.