KUWAIT CITY: Kuwait’s projects market received a KD 5.2 billion boost with the awarding of the New Refinery Project (NRP) and the new airport terminal in recent weeks. The much anticipated award of two of Kuwait’s largest strategic projects brings the total value of contracts awarded in 2015 to KD 8.4 billion ($28 billion). It sets Kuwait’s projects market on the path for another record year. According to MEED Projects, the total value of Kuwait’s projects market (planned and active) grew to over KD 71.3 billion ($235 billion) by the beginning of August 2015. Below is a breakdown of developments relating to Kuwait’s major projects in 2015.
Oil and gas Kuwait National Petroleum Company (KNPC) officially awarded four out of the five packages of the New Refinery Project at Al-Zour. The bids were originally opened in March 2015 but because they came in at least 20 percent over budget, KNPC had to apply for an increase in its budget. KNPC secured approval to increase the project’s budget by an additional KD 871 million, eventually paving the way for the project to be awarded to its original bidders. The consortium of Tecnicas Reunidas/Sinopec/Hanwha submitted the lowest bid of KD 1.1 billion for the first package (processing plant).
The group of Fluor Corporation/HHI/Daewoo Engineering submitted the lowest bids of KD 832 million and KD 987 million for the second (processing plant) and third packages (utilities & off-site facilities), respectively. Hyundai E&C submitted the lowest bid of KD 454 million for the fifth package (marine facilities). The Fourth package (Tankage) was the only package to be retendered in July; KNPC officials awarded the KD 475 million contract to Italian firm Saipem in August. Once completed, the new refinery at Al- Zour is expected to be the largest of its kind in the Middle East.
At 615,000 barrels per day (b/d), Al-Zour refinery would effectively double Kuwait’s refining capacity, from a current 730,000 b/d to 1.4 million b/d. In July, Kuwait Oil Company (KOC), awarded a contract for a Manifold Gathering System. The KD 222 million ($733 million) contract was awarded to UK-based Petrofac to develop a liquid transport system from a number of oil wells to gathering centers 29, 30, and 31 which are currently under development. The three gathering centers will help crude production capacity in Kuwait’s northern oil fields. KOC also announced that it is planning a fourth gathering center (32) to be tendered in 2016.
Construction
According to MEED Projects, the Ministry of Public Works (MPW) has tendered the New Maternity Hospital. Pizzarotti, an Italian firm, submitted the lowest bid of KD 220 million ($728 million) for the project. The hospital project, which envisages a total build up area of 351,000 m2 and plans to accommodate 780 beds, was among three others originally tendered in 2013 that were scrapped because they were over budget. The MPW is scheduled to hand over the Jaber Al-Ahmed Hospital and Al-Razi Hospital expansions to the Health Ministry by December 2015. June 30 was the Public Authority for Housing Welfare’s (PAHW) deadline for companies wishing to qualify for three major infrastructure contracts relating to South Mutlaa City.
The PAHW has split construction into three parts: a Main Roads package; a 5 Neighborhoods package (12,000 plots); and a 7 Neighborhoods package (18,000 plots). According to MEED, the list of prequalified companies has not yet been released. The South Mutlaa City project is Kuwait’s next major housing project (29,000 housing units), with infrastructure contracts scheduled to be awarded in January 2016. The PAHW began plot distributions to citizens in August 2015, as it attempts to make good on its promise to deliver 12,000 units in the city during the current fiscal year. The project is scheduled for completion in 2018. Power & Water The Ministry of Electricity & Water (MEW) plans to set up two desalination plants at Doha to help increase water supply levels in Kuwait in the face of rising demand.
In June, Spanish firm Abeinsa submitted the lowest bid of KD 106 million ($351 million) for phase 1 of the Doha Desalination Plant. The plant will have a capacity of 60 million gallons/day. The contract has not yet been awarded though. The deadline to prequalify for several Public-Private Partnership (PPP) projects ended in June. The Kuwait Authority for Partnership Projects (KAPP) issued several requests for qualification (RFQs) for power projects scheduled to be awarded in 2016. KAPP is yet to release the names of prequalified companies for two renewable energy projects: Al-Abdaliya Integrated Solar Combined Cycle (ISCC) Power Plant and Kabd Municipal Solid Waste Project, as well as the Umm al- Hayman Wastewater Treatment Plant.
In June, the PAHW awarded a KD 45 million contract to design and install 10 Main Transformer Stations in the Wafra residential area. Transportation The Central Tenders Committee (CTC) awarded the retendered New Terminal Building at Kuwait Airport on 17 August 2015. Turkey’s Limak and the local Kharafi National Company Joint Venture won the award with their lowest bid of KD 1.32 billion. It was followed by Beijing-based China State Construction Engineering Corporation and UAE-based Arabtec. Though lower than their initial November 2014 bid, Limak’s bid still remains 33 percent above budget. The Ministry of Public Works might need to increase its budget. The Directorate General for Civil Aviation (DGCA), responsible for the airport, is also moving ahead with other projects.
The deadline for prequalification for the KD 150 million Passenger- Support Building is past. The shortlist of qualified companies is due in October. The project is designed to be a “quick fix” to relieve traffic pressure on the existing terminal. The DGCA is also looking to tender the KD 148 million Runway & Parallel Taxiways Package. The tender is due to be issued in 3Q15. The Ministry of Public Works awarded local contractor Mushrif Trading & Contracting a KD 82 million contract to develop a 40 kilometer road linking Mina Abdulla to Wafra.
