Oman seeks bids from private sector for desalination plants on build-own-operate basis

Oman’s Public Authority for Electricity and Water (PAEW) has floated public bids for a pair of small water desalination plants to be implemented for the first time on a build-own-operate (BOO) basis.

The BOO-based small desalination plants are planned in Mahout Wilayat (Wusta Governorate) and Musandam Governorate.

Offers will be due by October 16, 2017 for either of these two projects, the Oman Observer stated.

According to the Authority, small water desalination schemes will be procured on a BOO basis primarily in areas that are served by isolated water networks, tanker filling stations or small desalination plants.

Supply in such areas is typically handled by the PAEW. However, where water production is co-located with electricity generation, supplies are managed by the Rural Areas Electricity Company (RAECO).

“PAEW has now adopted a policy of ‘Build Own Operate’ for these areas — new plants will be procured from the private sector which will take the responsibility for long term performance with PAEW buying the water under contract. Pilot contracts have shown considerable savings and this model is now in use across PAEW’s area,” PAEW said in a statement.

Compared with its wealthier Gulf neighbors, Oman does not have huge reserves of oil and gas, and its budget deficit widened in the first five months of the year, to US$5.2 billion. It aims to diversify its economy beyond oil and gas exports.

Oman is said to plan raising $2 billion in debt this year for its 2018 budgetary needs.

Oman in August signed an agreement for $3.5 billion in loans from Chinese financial institutions and in May raised $2 billion through an Islamic bond sale, which lured orders for more than three times the issue size.

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