DOHA: The Qatar Electricity and Water Co QSC (QEWC) has announced that is has entered into an agreement to acquire the AES Corporation's (AES) entire stake in Ras Laffan Power Company Limited, the owner of an independent power and water desalination plant with the capacity of 750MW and 40 million gallons per day (MIGD) of desalinated water.
QEWC will buy AES's 55 percent interest in the Ras Laffan Power Company Limited (RLPC) and its 70 percent interest in the AES Ras Laffan Operating Company WLL (RLOC), which provides operation and maintenance services to RLPC.
This move has now conferred QEWC the operating responsibilities of RLPC. The transaction is subject to customary approvals and is expected to close during the second half of 2010.
The deal, when completed will result in an increase in QEWC's interests in RLPC and RLOC to 80 percent and 100 percent respectively.
Speaking on the occasion, QEWC's General Manager, Fahad Hamad Al Mohannadi said that QEWC is committed to expand its operations keeping in view the operational efficiency and relevant factors among others.
He said the deal will strengthen QEWC's position in the Qatari power sector. Qatar has laid greater emphasis on the power and energy sectors as the way forward for its surging economy and has placed a number of initiatives in place encouraging the Qatari utility companies in their operational responsibilities.
QEWC was established in 1990 as a Qatari joint stock company with major shareholding by the Government of the State of Qatar. It is one of the major companies in the State of Qatar and the Gulf region. The company owns and operates a large network of power generation and water desalination stations in the State of Qatar.
QEWC is one of the largest power and desalination companies (by volume of shares) not only in its home country, but also in the entire Arabian Gulf region. In the past 20 years, QEWC has continued to expand its activities and production through fully owned and exclusively managed plants such as the Ras Abu Fontas, Al Wajba, Al Saliyah, Doha South and Dukhan stations and substations and through jointly owned and managed plants such as Ras Laffan A, Ras Laffan B, Mesaieed, and Ras Laffan C.
QEWC's current portfolio includes over 5.2GW of power capacity and 235 MIGD of potable water capacity including the capacity of the projects under construction. QEWC has expanded considerably in the last two decades, with strong revenue and profitability growth where its revenues in 2009 reached QR 2.6bn.
Commenting on the deal, Khalid Jolo, Business Development Manager at QEWC said, "QEWC is looking forward to capitalise its success in the Qatari power and water sector and expand its portfolio globally. Aiming at its International penetration, QEWC has recently submitted bids for the Barka-III and Sohar-II IPPs in Oman alongside international and local consortium partners. QEWC is also evaluating several opportunities in the Middle East, Europe and Asia."
RBS Corporate Finance Limited ("RBS") has acted as financial adviser and Norton Rose LLP and Arab Law Bureau LLP have acted as legal advisers to QEWC in connection with this transaction.
© The Peninsula 2010
