The Government of Oman has announced successful closure of a deal to construct phase I of the Barka power and desalination project with AES Barka, a local subsidiary of the US based AES Corp in a joint venture with Multitech LLC.

Barka Phase I involves design, financing, construction ownership and operation of a 427MW combined cycle power plant and 3800 cubic metre/h water desalination plant at Barka. The station will be fired with natural gas.

The scheme is the third independent power project in Oman and second since the government launched it electricity and water privatization programme in June 1999. The request for proposals was issued on 25 April 2000, and three bids were received by 4 September. AES was appointed preferred bidder on 17 October.

Under the terms of the build-own-operate deal, AES will be granted a 25 year licence to generate at the plant. The initial power and water purchase agreement is for 15 years, as is the natural gas supply agreement. However the plant is expected to be able to continue to operate commercially beyond the first 15 years.