Gama Energy, a joint venture between Gama Holding and General Electric Energy Financial Services, is investing US$1bn in a project that would help Jordan solve its water problems. The project aims to bring water from the Mudawara region to the capital Amman.
Jordan is one of the world’s most water-scarce countries. The Disi Water Conveyance Project includes the construction of a 325km pipeline that will pump water from Disi aquifer to Jordan’s most populous city. It is expected to supply Amman and the surrounding areas with more than 100 million cubic metres of water a year.
The United States’ Overseas Private Investment Corporation, European Investment Bank and Proparco of France are providing US$445mn in credit financing for the project. The Jordanian ministry signed loan agreements with the EIB and the French Development Agency on May 17. Jordan’s water and irrigation ministry is granting US$300mn and Gama Energy will complete the financing by putting US$190mn as equity capital.
Arab Banking Corporation (ABC) provided pre and post bid financial advisory services to Gama Energy which was awarded the concession following a competitive bidding process which commenced in 2006.
Arif Özozan, general manager of Gama Energy, said the firm is happy to help Jordan solve its water problems. "In the midst of the global recession, we are proud to have received the vote of confidence from the financial community in this US$1bn project," Özozan said.
The Disi project is also the largest water delivery project in the region that is financed by the private sector. The project will be operated by Gama Energy for 25 years and then will be transferred to the state.
The construction of the project is expected to start in July and may last for four years. Gama will use 250,000 tons of steel and open 55 wells in the area. The operating and maintenance services for the pipeline will be provided by Disi Amman Operation and Maintenance LCC, a Jordanian company formed for this project.
Jordan has one of the lowest per capita water consumption rates in the world. According to the existing regulations, citizens in Amman can receive water only once a week. The country’s annual consumption stands at 900 million cubic meters, but projections show that starting from 2015, the country will need 1.6 billion cubic meters each year. The Disi project will provide 6% of this amount.
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