The Sur IPP has been established under a Build-Own-Operate (BOO) scheme. The agreement requires the shareholders of the project company to offer 35 per cent of their stakes in an Initial Public Offering (IPO), which will be launched soon. Oommen John P reports.
The RO633mn Sur Independent Power Project (Sur IPP), the Sultanate’s largest power plant currently in operation, was officially inaugurated recently in the presence of HH Sayyid Hamad bin Thuwaini bin Shihab Al Said.
Located in the Sur Industrial Estate, the state-of-the-art plant provides around 28 per cent of the Main Interconnected System’s (MIS) current contracted capacity. The Sultanate’s electricity demand is forecast to increase at an annual rate of around nine per cent. With peak demand for power within Oman expected to grow from 5,122 MW in 2014 to 9,530 MW in 2021 and average demand expected to grow from 2,852 MW in 2014 to 5,373 MW in 2021, the Sur Independent Power Project (Sur IPP), is certain to play a significant role in contributing to that growth.
The combined cycle power generation plant has a total installed capacity of approximately 2,000 MW and comprises three blocks, two of around 800 MW and one of around 400 MW and has been in commercial operation since December 2014.
In his address, Ahmed bin Saleh Al Jahdhami, CEO of Oman Power and Water Procurement Company (OPWP) said the electricity sector had been able to attract local and international players adding that the Sur IPP had been established under a Build-Own-Operate (BOO) scheme. The Sur power plant agreement was signed with the Phoenix Power Company in July 2011. The agreement requires the shareholders of the project company to offer 35 per cent of their stakes in an Initial Public Offering (IPO).
Khalid Jolo, Chairman of Phoenix Power Company said the company along with its consortium partners will bid for two other new power projects in Oman, including Sohar. He further said the IPO for Sur power project will be launched later this year.
Also attending the inauguration were senior members of key Omani Government bodies and the founding shareholders of the Owner, Phoenix Power Company. The Sur IPP is part of the continuous development of Independent Power Projects by Oman Power and Water Procurement Company (OPWP), a member of the Nama group) to ensure that sufficient power generation resources are available to meet the growing electricity demand in the Sultanate. The launch of the project is in line with the Sultanate’s strategy which aims at increasing local and foreign investments in electricity generation and at establishing a firm economic foundation that relies on private sector participation.
Owned by Phoenix Power Company, the founding shareholders are Axia Power Holdings B.V. (Marubeni Corporation, Japan), Chubu Electric Power Sur B.V. (Chubu Electric Power Co., Inc., Japan), Qatar Electricity and Water Company (Q.S.C.) and Multitech LLC (part of the Suhail Bahwan Group, Oman) while the project is operated by Phoenix Operating and Maintenance Company.
Phoenix Power Company currently generates its revenues pursuant to a 15-year term Power Purchase Agreement (PPA) with OPWP which is part of the government-owned Electricity Holding Company SAOC (Nama Group Companies). The power produced from the power plant is fully contracted to OPWP and used to meet the growing power demands of the Main Interconnected System (MIS) region during the term of the PPA. The Ministry of Oil and Gas is the supplier of natural gas while the Authority for Electricity Regulation has granted a generation license to produce electricity at the Sur IPP facilities.