UAE PPP activity rises

8 October 2024

 

All eyes are on Dubai in the final quarter of the year as it endeavours to bring to the market its largest infrastructure project to date.

The prequalification process is under way for potential investors for the planned $22bn Dubai Strategic Sewerage Tunnels (DSST) project, which will be procured on a public-private partnership (PPP) basis.

The project's ambitious scope includes converting Dubai’s existing sewerage system from a pumped system to a gravity system by decommissioning the existing pump stations and providing “a sustainable, innovative, reliable service for future generations”.

Dubai currently has two major sewerage catchments. The first, in Deira, is Warsan, where the Warsan sewage treatment plant (STP) treats the flow. The second catchment is in Bur Dubai, where the wastewater is treated at the Jebel Ali STP.

The DSST will replace 120 pump stations, saving approximately 100 gigawatt-hours of electricity annually, MEED has been told. 

The 25-35-year design-build-finance procurement model is also ambitious, given that Dubai has a dismal PPP track record, with the exception of electricity and water generation projects.

The DSST project has met major interest from engineering, procurement and construction (EPC) contractors. A total of 21 individual companies and consortiums prequalified to bid for the project’s three tunnels and terminal pump station packages – J1, J2 and W. Nineteen have been prequalified to bid for package J3.

The client is expected to run a separate prequalification process for the packages to upgrade the two existing STPs.

At the time of writing, Dubai Municipality, the project client, has yet to receive the statements of qualifications from interested investors.

Industry sources have indicated, however, that those that have shown early interest include Japan's Marubeni Corporation and Itochu, Australia's Plenary Group, Belgium's Besix, China Railway Engineering Corporation and China Harbour Engineering Company, and potentially some Israeli investors.

The project is essential to support Dubai’s economic expansion and sustainability ambitions, notes a source close to the scheme, stopping short of saying that the lack of suitable infrastructure could limit the extent to which the emirate can grow.

So far, while everyone agrees that the project is imperative, some need further convincing of the likelihood of success for the project’s chosen PPP route.

“It is a civil construction project with limited operation and maintenance scope,” says a senior executive with an infrastructure investor, who adds that the government of Dubai can raise a bond much cheaper than equity.

A senior transaction adviser not linked to the project notes, however, that since PPPs are a combination of debt and equity, “overall, PPPs are cheaper for governments”.

The latter adds that the PPP route is doable if the project is tendered in phases or one at a time, as is currently planned.

 Water desalination and treatment projects

In recent months, the UAE has also seen an uptick in water desalination plants utilising reverse osmosis technology.

Three independent water projects (IWPs) are under construction, including Abu Dhabi’s Mirfa 2 and Shuweihat 4, and Hassyan 1 in Dubai. The three seawater reverse osmosis (SWRO) plants have a total combined capacity of 370 million imperial gallons a day (MIGD).

Negotiations are under way for the contract to develop Abu Dhabi’s next IWP on Saadiyat Island, while the request for qualifications for another project, the 90MIGD Al-Nouf IWP, is expected to be issued in December this year or January 2025.

Sharjah Electricity & Water Authority (Sewa) also awarded the contract to develop its first IWP scheme this year to Saudi Arabia-headquartered Acwa Power, which was the tender’s sole bidder.

The $682m, 90MIGD project is expected to reach financial close soon.

"This is Sharjah’s first IWP and, unlike other jurisdictions such as Oman, Abu Dhabi and Saudi Arabia, the emirate has yet to establish a track record with PPPs, especially in power and water," says Robert Bryniak, CEO of Dubai-based Golden Sands Management (Marketing) Consulting.

He notes that once the Hamriyah IWP reaches financial close and commercial operations, Sewa should be able to attract more developers for future IWPs. 

Sewa is not the only utility launching its maiden IWP. Etihad Water & Utility (Etihad WE) is understood to have conducted a market-sounding event earlier this year for a small SWRO plant to complement the capacity of an existing facility in Ghalilah in Ras Al-Khaimah, another of the UAE's northern emirates.

Ras Al-Khaimah's Public Services Department and Investment & Development Office have also started the tendering proceedings for the emirate's first independent sewage treatment plant project.

The proposed plant will be able to treat 60,000 cubic metres a day (cm/d) of sewage water, which could be expanded to 150,000 cm/d.

The project has garnered strong interest from the market, with the following companies and consortiums having been prequalified to bid for the contract:

  • Acciona (Spain)
  • Besix (Belgium)
  • China Harbour Engineering Company (China) / BOWT
  • Cobra (Tedagua, Spain)
  • GS Inima (Spain/South Korea) / Alkhorayef Water & Power Technologies (Saudi Arabia)
  • Etihad Water & Electricity (UAE) / Saur (France)
  • FCC Aqualia (Spain)
  • MA Kharafi (Kuwait) / Passavant Energy & Environment (UAE, Germany)
  • Metito
  • Miahona Company (Saudi Arabia)
  • Orascom Construction (Egypt)
  • Sustainable Water Solutions (UAE)
  • Veolia Middle East (France / local)

MEED understands that the scope of the build, own, operate and transfer scheme will include extensive sewerage and distribution works, in addition to the STP.

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Jennifer Aguinaldo
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    Engineering, procurement and construction (EPC) works are progressing on an estimated $2bn to $2.5bn carbon dioxide (CO2) sequestration complex project of QatarEnergy LNG covering its liquefied natural gas (LNG) production operations in Qatar’s Ras Laffan Industrial City (RLIC).

    Once commissioned, the planned sequestration facility will be capable of capturing 4.3 million tonnes a year (t/y) of CO2 from QatarEnergy LNG’s production operations in RLIC.

    QatarEnergy LNG, a subsidiary of state enterprise QatarEnergy, awarded the main EPC contract for the CO2 sequestration project to South Korean contractor Samsung C&T, sources told MEED.

    The letter of award for the EPC contract was issued by QatarEnergy LNG to Samsung C&T on 27 May, according to a source.

    The following contractors are among those that are understood to have submitted bids in April for EPC works on the QatarEnergy LNG CO2 sequestration project:

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    • Samsung C&T (South Korea)

    Based on the initial evaluation of bids, Larsen & Toubro Energy Hydrocarbon is understood to have pulled ahead in the race for the project’s contract, MEED previously reported. However, sources, at the time, added that the situation could change.

    QatarEnergy LNG awarded Australia-headquartered consultancy Worley a contract in September 2023 to execute the front-end engineering and design (feed) work on the project and to prepare the EPC scope of work.

    CO2 sequestration facility

    The planned sequestration facility will capture CO2 from seven LNG trains at the QG North complex and three LNG trains at the QG South complex.

    The CO2 captured from the trains is to be dehydrated, compressed and transferred via a new 154-kilometre pipeline, to be injected into wells at the Dukhan oil field development onshore Qatar for a related enhanced oil recovery pilot scheme.

    The pilot project is part of QatarEnergy’s long-term strategy for the redevelopment of the Dukhan fields that will contribute to the recovery of additional crude.

    The detailed EPC scope of work on the CO2 sequestration project covers the following:

    • QG North complex:
      • Installation of four new electric-driven compressors
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      • Dehydration package
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      • Integration with South injection system unit 85
      • Solvent reformulation for South trains 1/23
      • New power substation for power import from Kahramaa 35MW
      • New SIH for DCS/ESD/F&G
      • Tie-ins with utility units
      • Dehydration package
      • Chillers package
      • Pig launcher
         
    • RLIC corridors
      • Common 22-inch export pipeline stretching 18 kilometres
      • Power tie-in RLF3 with Kahramaa
      • Electric cables
      • Fiber optic cable
         
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      • Six injection wells by QatarEnergy LNG subsurface
      • Six injection flowlines and metring skid
      • Six wellhead control panels
      • Power tie-in from Barzan
      • Substation
      • Pig receiver
      • Access road and fencing

    The project will directly reduce CO2 emissions because some of the CO2 injected into wells at the Dukhan oil field will remain in the reservoir after injection.

    The CO2 sequestration complex in RLIC is expected to start operations by the end of 2027.

    North Field LNG expansion

    Meanwhile, QatarEnergy LNG continues to press forward with its North Field LNG expansion programme.

    The estimated $40bn North Field LNG expansion programme aims to raise Qatar’s total LNG production capacity from 77.5 million t/y to 142 million t/y in three phases.

    QatarEnergy is understood to have spent almost $30bn on the two phases of the North Field LNG expansion programme, North Field East and North Field South, which will increase its LNG production capacity from 77.5 million t/y to 126 million t/y by 2028.

    EPC works on the two projects are making progress.

    QatarEnergy awarded the main EPC contracts in 2021 for the North Field East project, which is projected to increase LNG output to 110 million t/y by this year. The main $13bn EPC package, which covers the engineering, procurement, construction and installation of four LNG trains with capacities of 8 million t/y each, was awarded to a consortium of Japan’s Chiyoda Corporation and France’s Technip Energies in February 2021.

    QatarEnergy awarded the main EPC contract for the North Field South LNG project, worth $10bn, in May 2023. The contract covers two large LNG processing trains, each with a capacity of 7.8 million t/y, and was awarded to a consortium of Technip Energies and Lebanon-based Consolidated Contractors Company.

    When fully commissioned, the first two phases of the North Field LNG expansion programme will contribute a total supply capacity of 48 million t/y to the global LNG market.

    In February 2024, QatarEnergy announced the third phase of its North Field LNG expansion programme. To be called North Field West, the project will further increase QatarEnergy’s LNG production capacity to 142 million t/y when it is commissioned by 2030.

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    The state enterprise recently started a prequalification process for the main tendering exercise for dredging works on the North Field West project.

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  • New Murabba signs up consultants for project delivery

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    Saudi Arabia’s New Murabba Development Company (NMDC) has signed agreements with three US-based engineering firms to undertake design works on various assets at the New Murabba downtown project in Riyadh.

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    Also in July, NMDC announced the completion of excavation works for the Mukaab, the centrepiece of the overall development.

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    The New Murabba destination will have a total floor area of more than 25 million sq m and will feature more than 104,000 residential units, 9,000 hotel rooms and over 980,000 sq m of retail space.

    The scheme will include 1.4 million sq m of office space, 620,000 sq m of leisure facilities and 1.8 million sq m of space dedicated to community facilities.

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    The GCC is projected to add at least 80 million tonnes a year (t/y) of liquefied natural gas (LNG) capacity by 2030, placing it firmly among the world’s top three producing regions.

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    > PPPs: NCP showcases private sector project opportunities in Saudi Arabia

    > GREEN STEEL: Abu Dhabi takes the lead in green steel transition

    > DIGITISATION: Riyadh-based organisation drives digital growth

    > LEADERSHIP: Saudi Arabia’s housing boom risks leaving citizens behind

    > UAE MARKET REPORT: 
    > COMMENT: Investment shapes UAE growth story
    > GOVERNMENT: Public spending ties the UAE closer together

    > ECONOMY: UAE growth expansion beats expectations
    > BANKING: Stability is the watchword for UAE lenders
    > OIL & GAS: Adnoc strives to build long-term upstream potential
    > PETROCHEMICALS: Taziz fulfils Abu Dhabi’s chemical ambitions at pace
    > POWER: UAE power sector hits record $8.9bn in contracts
    > WATER: Tunnel projects set pace for UAE water sector
    > CONSTRUCTION: UAE construction faces delivery pressures
    > TRANSPORT: $70bn infrastructure schemes underpin UAE economic expansion
    > DATABANK: 
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    Neom omitted from Saudi pre-budget statement

    Qiddiya high-speed rail PPP is a bold but risky move
    Wood leadership change holds promise for future
    Power market reshapes contractor landscape

    > GULF PROJECTS INDEX: Gulf projects market leaders return to fore

    > SEPTEMBER 2025 CONTRACTS: Qatar leads awards as regional activity slows

    > ECONOMIC DATA: October 2025: Data drives regional projects

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  • Contractors submit UAE high-speed rail bids

    30 October 2025

     

    The UAE’s Etihad Rail received bids on 29 October from contractors for the tender to design and build the civil works and station packages for the high-speed railway (HSR) line connecting Abu Dhabi and Dubai.

    Earlier in October, MEED exclusively reported that contractors were forming joint ventures to bid for upcoming design-and-build work packages for the UAE’s high-speed railway project.

    MEED understands that the group formations for the civil works packages are as follows:

    • Limak / Dogus / Ozkar (Turkiye) – Dubai section
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    • China Railway Engineering Corporation (China) – Dubai section
    • China Railway Engineering Corporation / WBG (China/local) – Abu Dhabi

    French engineering firm Systra is the designer for the Limak-led consortium.

    US-based Jacobs is the designer for the NPC group.

    A joint venture of Systra and US-based Aecom is the designer for the WeBuild group.

    French engineering firm Egis and Singapore’s Surbana Jurong are the designers for the L&T-led consortium.

    Switzerland’s ARX is working with China Civil Engineering Construction Corporation as its designer.

    Chinese firm China Railway Eryuan Engineering Group is working with China Railway Engineering Corporation as its lead designer for both sections of the project.

    Teams are also forming for the systems package. These are:

    • Siemens / Rowad / Salcef (Germany/Egypt/Italy)
    • Hitachi / Orascom (Japan/Egypt)
    • Alstom / L&T (France/India)
    • CRRC (China)
    • Hyundai Rotem / Posco (South Korea)
    • Talgo / Hassan Allam (Spain/Egypt)
    • CAF (Spain)

    The design speed of the trains running on the UAE’s HSR network will be 350 kilometres an hour (km/h) and the operating speed will be 320km/h, as MEED reported last year.

    The proposed HSR programme will be constructed in four phases, gradually adding further connectivity to other areas within the UAE.

    The first phase involves constructing a railway line connecting Abu Dhabi and Dubai, which is expected to be operational by 2030.

    The second phase will develop an inner‑city railway network with 10 stations within the city of Abu Dhabi.

    The third phase of the railway network involves constructing a connection between Abu Dhabi and Al-Ain.

    The fourth phase involves developing an inter-emirate connection between Dubai and Sharjah.

    The 150km first phase of the HSR will stretch from the Al-Zahiyah area of Abu Dhabi to Al-Jaddaf in Dubai.

    The project’s civil works have been split into two packages – Abu Dhabi and Dubai – comprising four sections. The scope of these sections includes:

    • Phase 1A: Al-Zahiyah to Yas Island (23.5km) 
    • Phase 1B: Yas Island to the border of Abu Dhabi/Dubai (64.2km)
    • Phase 1C: Abu Dhabi/Dubai border to Al-Jaddaf (52.1km)
    • Phase 1D: Abu Dhabi airport delta junction and connection with Abu Dhabi airport station (9.2km)

    The rail line will have five stations: Al-Zahiyah (ADT), Saadiyat Island (ADS), Yas Island (YAS), Abu Dhabi International Airport (AUH) and Al-Jaddaf (DJD).

    The ADT, AUH and DJD stations will be underground, while ADS will be elevated and YAS will be at grade.

    The overall construction package also includes provisions for rolling stock, railway systems and two maintenance depots.

    The high-speed project will slash journey times between the UAE’s two largest cities and economic centres. The journey time between the YAS and DJD stations will be 30 minutes.

    Preliminary site testing works have begun. Dubai-based Matcon Testing Laboratory and Abu Dhabi’s Engineering & Research International are conducting drilling tests to ascertain the ground conditions in areas through which the HSR will pass. 

    Spanish engineering firms Sener and Ineco are the project’s engineering consultants.

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    Yasir Iqbal
  • Kuwait Oil Company seeks approval to increase budgets

    30 October 2025

     

    State-owned upstream operator Kuwait Oil Company (KOC) is seeking approval from Kuwait Petroleum Corporation (KPC) to increase budgets for key projects, according to industry sources.

    Approvals are currently being sought for three upstream projects, which saw bids submitted significantly over budget.

    The first project, with a low bid of $2.47bn, involves the development of two facilities: Separation Gathering Centre 1 (SGC-1) and Water Injection Plant 1 (WIP-1).

    The second project, with a low bid of $2.48bn, focuses on developing SGC‑3 and WIP‑3.

    The third project, which involves the development of effluent water disposal plants for injector wells, had a low bid of $1.3bn.

    If approval is given by KPC, then final approval will be sought from the country’s Ministry of Finance, industry sources said.

    Already cancelled

    One Kuwaiti oil project tender that received bids significantly above budget has already been cancelled.

    On 7 October, MEED reported that the tender for the SGC-2 oil project – focused on the installation of a separation gathering centre – was cancelled by Kuwait’s Central Agency for Public Tenders.

    In May, MEED reported that UK-based engineering firm Petrofac submitted a bid more than double the project’s proposed budget.

    Petrofac’s bid was KD422.45m ($1.37bn), while the provisional budget stood at KD207m ($670.2m).

    This contract is expected to be retendered, but there is significant uncertainty over when a new invitation to bid will be issued and how the scope may be changed.

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    Wil Crisp