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Dubai prequalifies developers for $22bn tunnels PPP

6 February 2025

 

Dubai Municipality has prequalified developers for the first four packages of the $22bn Dubai Strategic Sewerage Tunnels (DSST) project.

According to industry sources, at least three companies have been prequalified as lead members of potential consortiums that can bid for the contracts.

These include:

  • Etihad Water & Electricity subsidiary (local)
  • Itochu (Japan)
  • Vision Invest (Saudi Arabia)

Other companies have been prequalified as technical members. 

MEED reported in October that over a dozen companies were keen to prequalify as investors or sponsors of the planned public-private partnership (PPP) project.

They included:

  • Abrdn Investcorp Infrastructure Investments Manager (UK)
  • Besix (Belgium)
  • China Railway Construction Corporation (CRCC)
  • China Railway Engineering Group (CREG)
  • China State Construction Engineering Corporation (China)
  • Itochu (Japan)
  • Nesma Company (Saudi Arabia)
  • Plenary (Australia)
  • Samsung C&T (South Korea)
  • Vision Invest (Saudi Arabia)
  • Webuild (Italy)

The request for proposals for the project’s first two packages is expected to be issued imminently.

MEED previously reported that the bidders for the PPP packages will be prequalified consortiums comprised of sponsors or investors, EPC contractors, and operations and maintenance contractors.

The overall project will require a capital expenditure of about AED30bn ($8bn), while the whole-life cost over the full concession terms of the entire project is estimated to reach AED80bn.

The investor prequalification process for the scheme comes after the client prequalified EPC contractors that can partner with the developers or investors to bid for the contracts.

MEED understands that packages J1 and W will be tendered together as separate contracts first, followed by J2 and J3, with the requests for proposals to be issued sequentially, staggered about six to 12 months apart.

DSST packages

Under the current plan, the $22bn DSST project is broken down into six packages, which will be tendered as PPP packages with concession periods lasting between 25 and 35 years.

The first package, J1, comprises Jebel Ali tunnels (North) and terminal pump stations (TPS). The tunnels will extend approximately 42 kilometres (km), and the links will extend 10km. 

The second package, J2, covers the southern section of the Jebel Ali tunnels, which will extend 16km and have a link stretching 46km.

The third package, W for Warsan, comprises 16km of tunnels, TPS and 46km of links.

J3, the fourth package, comprises 129km of links.

J1, J2, W and J3 will comprise the deep sewerage tunnels, links and TPS (TLT) components of the overall project.

J1, J2 and W will be procured under a design-build-finance-operate-maintain model with a concession period of 25-35 years.

J3 will be procured under a design-build-finance model with a concession period of 25-35 years. Once completed, Dubai Municipality will operate J3, unlike the first three packages, which are planned to be operated and maintained by the winning PPP contractors.  

The project’s remaining two packages entail expanding and upgrading the Jebel Ali and Warsan sewage treatment plants. MEED understands that these packages will be procured at a later stage.

READ THE FEBRUARY MEED BUSINESS REVIEW

Trump unleashes tech opportunities; Doha achieves diplomatic prowess and economic resilience; GCC water developers eye uptick in award activity in 2025.

Published on 1 February 2025 and distributed to senior decision-makers in the region and around the world, the February MEED Business Review includes:

> WATER & WASTEWATER: Water projects require innovation
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