JEDDAH, 24 July 2007 — The objective of the road show on business opportunities in water is to focus on the second Public Private Partnership (PPP) for managing, operating and maintaining the water and wastewater sector in Jeddah city as well as the future investment opportunities in the field of water and wastewater sector in Saudi Arabia to be offered to potential private investors and operators.
The Ministry of Water and Electricity (MoWE) has appointed reputed international consultants to provide advisory services in implementing the program of privatization in the water and wastewater sector in Jeddah. The consortium consists of CRA International as lead advisers with Hyder Consulting (technical), Ernst & Young (financial and human resources) and Prima Law/Freshfields (legal). These consultancy contracts will work toward the formation of the branch of National Water Company (NWC) in Jeddah, pre-qualify the international operators, prepare PPP contracts and work toward financial closure.
MoWE plans to offer a management contract for the operation and maintenance of wells, water conditioning plants, water supply network and wastewater collection in Jeddah city. The second contract will cover the operation and maintenance of wastewater treatment plants in Jeddah including future expansions. This contract is likely to be a long term concession contract or a combination of management and concession contract. The PPP contracts envisaged for Jeddah city’s water and wastewater sector is expected to be operational by the third quarter 2008.
As a preparatory before the commencement of the PPP contracts, MoWE signed a contract on June 19 with a consortium of Al-Zamil group and Saur of France, a reputed international water networks operator to provide technical advisory services to Jeddah Water Directorate and implement certain immediate improvements in the management, operation and maintenance of water supply in Jeddah city including customer services.
Several international operators submitted offers for the management contract covering the water supply network and wastewater collection in Riyadh city. It is expected that the selection of a successful bidder and signing of contract will be completed in the fourth quarter of 2007. The NWC, which is now in the final phase of its formation formalities, will be the signatory to all such PPP contracts. The awarded company will manage, operate and maintain underground water production, water treatment plants, and water and wastewater distribution networks.
The scope also covers the management and development of customer services, revenue collections, reduction of leakage in the networks, training and development of the current work force to improve efficiency and performance of the sector. This contract is considered to be the biggest in the Middle East.
Under the privatization plan, the ministry has signed another contract in June 2007 with a consortium led by financial consultants HSBC with Fichtner, Clifford Chance/Al-Jadaan for technical and legal advice. This contract is meant to provide tendering consultancy services for implementation of management/concession/BOO (Build, Own and Operate) contracts for the wastewater treatment plants in Riyadh city.
Several international firms specialized in the fields of water and wastewater sectors, have been invited to participate in this road show. Details regarding the event and privatization initiatives are available in the website www.nwc.com.sa.