SOUTH KOREA’S Hyundai Heavy Industries and France’s Sidem have together won an engineering, procurement and construction (EPC) contract worth $1.4 billion to build to the first phase of the Az-Zour North Independent Water and Power Project (IWPP) in Kuwait.

Under the deal, Hyundai would build a gas-fired power plant worth $970 million, while Sidem would construct a water desalination plant in this combined complex about 100 km south of Kuwait City.

The power plant would have a production capacity of 1,500 MW while the desalination plant would produce up to 486,000 cu m of water a day.

Construction was expected to start last month and be completed towards the end of 2016.

Hyundai Heavy has been part of the EPC consortium with Sidem since March 2011, formed by GDF Suez.

A consortium of Japan’s Sumitomo Corporation, France’s GDF Suez Energy International and Kuwait’s Abdullah Hamad Al-Sagar and Brothers is undertaking the Az-Zour North IWPP, which is the first ever public private partnership (PPP) in Kuwait. The consortium has a stake of 40 per cent, the government holds 10 per cent, while 50 per cent is to be distributed to citizens as free shares.

Production of power and fresh water will be sold to the Ministry of Electricity and Water for 40 years under the deal.

The National Bank of Kuwait is part of a consortium that includes Japanese lenders which will arrange a $1.43 billion loan for the IWPP, which is expected to cost a total of $1.8 billion.