Rise in Middle East Independent Water Projects as Demand for Water Increases
Type
E-journal
Date
15 Dec 2014
Jurisdiction
Egypt, Iran, Iraq, Kuwait, Lebanon, Libya, Oman, Qatar, Saudi Arabia, United Arab Emirates, Jordan
Taxonomy
Water, Infrastructure Projects
Copyright
LexisNexis
Relevant company
Latham & Watkins LLP
Associated digest links
Latham & Watkins LLP
Analysis
The majority of the world's desalination plants are located in the Middle East and we are likely to see a further increase given the region's increasing water consumption and general water scarcity. GCC demand for desalinate water has increased at a rate of 9-11% in recent years according to Frost & Sullivan. By 2020, it is expected that the Middle East will add an additional 39 million cubic metres per day of desalination capacity since 2010, which indicates an approximate investment of US $50 billion.
Desalination plants in the Middle East have to date been a relatively small bolt-on to a much larger scale power project forming what are commonly known as independent water and power projects (IWPPs) i.e., an integrated water and power plant developed by an independent producer, which is typically a global industry player.
However, given the increasing demand for water, it seems regional governments are increasingly adopting an independent water project (IWP) model to expedite supply and, given the introduction of solar and nuclear power projects in the region, Independent Water Projects (IWPs) are likely to become more prominent going forward.