Korea Southern Power announced on the 26th that it signed a power and fresh water purchase contract (PWPA) with Qatar’s Water and Power Administration on the 25th to supply power and fresh water for 25 years through the operation of the Facility EIWPP (Gas Complex and Fresh Water Plant) business.
It is the first achievement in about a month since Korea became the first investor to enter the Qatar power generation business by winning an order for the Qatar Facility EIWPP project on the 16th of last month.
The Qatar Facility EIWPP project is a large project with a total cost of $3.7 billion (about 5.2 trillion won) to build and operate a 2.4GW gas complex power generation and a 500,000-ton daily freshwater plant in the Ras Abu Fontas area of Doha, Qatar, through joint investments by the public sector (QEWC, Qatar Energy) and the private sector (Southern Power, KIND, Sumitomo Corporation, and Shikoku Electric Power).
This project is guaranteed stable profits through the Power and Fresh Water Purchase Agreement (PWPA) with the Qatar Water and Power Authority for 25 years of operation. It is significant in that Korean companies participate in all directions, including equity investment and financial support, as well as overseas construction design, purchase, and construction (EPC) in the Middle East, a key market for power generation and freshwater plants.
Southern Power Co. and KIND will own a stake in the business through direct investment worth $39 million (about KRW 54 billion) each, while Samsung C&T Co., a domestic construction company, will carry out an EPC worth $2.8 billion (about KRW 3.9 trillion). Domestic policy finance (Export and Export Bank, Korea Development Bank) and private finance (Woori Bank) will support large-scale loans.
Kim Joon-dong, president of Southern Power Co., said, “For the first time in Korea, we have successfully secured a base in the Middle East by entering the Qatar power generation and freshwater plant market as an investor. We will also contribute to the development and revitalization of overseas markets for domestic equipment by expanding our overseas energy territory through high-yield business development through selection and concentration.”
