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Wabag confirms Al-Haer ISTP contract award

12 February 2025

India-headquartered VA Tech Wabag has confirmed that it won a contract worth $371m for the engineering, procurement and construction (EPC) of the Al-Haer independent sewage treatment plant (ISTP) project in Riyadh, Saudi Arabia.

The Al-Haer ISTP project involves the development of a water treatment plant with a capacity of 200,000 cubic metres a day (cm/d).

It also includes the development of a treated sewage effluent (TSE) reuse system that covers a 32-kilometre pipeline with a capacity of 400,000 cm/d, a pumping station and TSE reservoir tanks with a capacity of 200,000 cubic metres.

It was the first project to be tendered under the third phase of the kingdom's ISTP procurement programme.

The confirmation of Wabag as the project EPC contractor coincided with the announcement that the SR1.5bn ($400m) project reached financial close on 9 February.

The funding was secured from Banque Saudi Fransi, Arab Energy Fund (formerly Apicorp)  and Riyad Bank.

The developer consortium implementing the contract to develop and operate the project comprises the local Miahona Company, Power & Water Utility Company for Jubail & Yanbu (Marafiq) and Belgium's Besix.

The consortium signed a 25-year water-purchase agreement with Saudi Water Partnership Company (SWPC) in March last year.

Miahona leads the project developer team with a 45% stake. Marafiq will own 35%.

The team offered to develop the project for SR1.9407 ($0.5173) a cubic metre.

The build-own-operate-transfer project is expected to reach commercial operation by the third quarter of 2027.

US/India-based Synergy Consulting provided financial advisory services to the Miahona-Besix team.  

SWPC qualified more than 20 companies last year to bid for the Al-Haer ISTP contract. It requested proposals for the contract from qualified bidders in November 2022.

Third batch schemes

Two other projects comprise the initial third ISTP batch. The Riyadh East and Khamis Mushait ISTP schemes will have 150,000 cm/d and 50,000 cm/d capacities, respectively. The contract to develop the two schemes has yet to be tendered.

Originally comprising three schemes with a total capacity of 400,000 cm/d, batch three of the ISTP programme has been expanded to include the Hadda ISTP and the Arana ISTP projects, which have been recently tendered.

UAE-based Future Water & Power Consulting, Netherlands-headquartered KPMG and US firm White & Case are providing technical, financial and legal advisory services, respectively, to the client for the ISTP batch three projects.

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Jennifer Aguinaldo

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