The UAE Offsets Group said that France's Sidem and South Korea's Hyundai Engineering have submitted the lowest-priced bids for the construction of a $1 billion power and water project in Fujairah.

A UOG statement said commercial bids submitted by three companies were opened on April 28 and 'France's Sidem, in partnership with South Korea's Hyundai Engineering and Construction Company, has submitted the lowest price of Dh2.954 billion ($560 million)'.

The state body said the proposal by Britain's Weir Westgarth was not opened 'as it was not compliant with the request for proposal issued by UOG'.

Other bidders for the construction of the project are South Korea's Hanjung and Italy's Fisia Italimpianti.

Hanjung in March changed its name to Doosan Heavy Industries and Construction Co. Fisia Italimpianti is a unit of construction group Impregilo. Sidem is a unit of Vivendi Environment and Weir Westgarth is a subsidiary of pumps and valves company Weir Group Plc.

The desalination and power plant package, worth an estimated $550 million, involves engineering, procurement and construction of a 100 million gallon per day desalination plant and a power plant of more than 100 MW.

The transmission package, worth an estimated $450 million, involves the construction of storage tanks, associated facilities and a 185-km water pipeline to the northern emirates and the oasis city of Al-Ain.

UOG said bids for the transmission package are due on May 30 after a three-week extension. It said both packages are due to be awarded by the end of July and the project is scheduled to be completed in 24 months.

The project, aimed at easing water shortages, will be initially funded by the Abu Dhabi government. At a later stage a foreign partner will be selected, in line with ongoing privatisation of the UAE power and water sector, to take a stake of up to 49 per cent and to operate the facilities.