Saudi-based Acwa Power, a leading water and power developer, owner and operator across 10 countries, has signed an agreement with Oman Power and Water Procurement Company (OPWP) for the development of the second phase of Salalah Independent Power Plant, which will have an installed capacity of 445 MW.

Acwa Power is part of a consortium comprising Mitsui & Company and Dhofar International Development and Investment Holding Company (DDIC) for the development of the project.

A member of Nama Group, OPWP is the sole procurer of all new power generation and water desalination capacity in the sultanate.

The new natural gas-fired combined cycle power plant which will be built at an estimated cost of SR2.32 billion ($620 million) will be connected to the existing Salalah grid, said Mohammed Abunayyan, the chairman of Acwa Power after signing the agreements with Ahmed Bin Saleh Al Jahdhami, the chief executive of OPWP, Tariq Abdulhafidh Al Ujaili, the vice chairman of Dhofar International Development and Investment Holding Company and Kazuhiro Hashimura, the general manager of Mitsui & Company.

The agreement, which was signed in Muscat last evening in the presence of Shaikh Saif bin Mohammed Al Shabibi, the Minister of Housing, also included Acwa Power’s acquisition of the existing Dhofar power plant, which has an output of 273MW.

According to the agreement, OPWP will have the right to buy the generated electricity over a period of 15 years. The plant will start it commercial operations by beginning of 2018.

Speaking at the ceremony, Abunayyan said the agreement reflects the solid base Acwa Power has in Oman, one of the company's primary markets.

Thamer Al Sharhan, the managing director, said Salalah 2 IPP was another success and important milestone in Acwa Power’s portfolio that reflects the company’s commitment in developing the Omani power and water sector, and provide job opportunities, training and developing Omani youth and workforce.-TradeArabia News Service