Acwa and Gulf Investment Corporation ( GIC ) have signed an energy conversion and water purchase agreement ( ECWPA ) for the Az-Zour North Phase 2 & 3 Independent Water and Power Producer project in southern Kuwait.

The offtake agreement with the Ministry of Electricity, Water and Renewable Energy ( Mewre ) of the State of Kuwait runs for 25 years. It formally enables the development of one of Kuwait’s largest integrated power and water plants.

Az-Zour North Phase 2 & 3 will be developed on a build-operate-transfer ( BOT ) basis. Once completed, the project will deliver a net power generation capacity of over 2,700 megawatts and up to 120 million imperial gallons per day of desalinated water, significantly reinforcing Kuwait’s electricity generation capacity and water security infrastructure.

The project is located approximately 100 kilometres south of Kuwait City, adjacent to the existing Az-Zour North Phase 1 facility, along the southeastern coastline of Kuwait near the Saudi border. It will comprise a combined cycle gas turbine ( CCGT ) power plant fuelled by natural gas, with gasoil back-up, alongside a seawater reverse osmosis desalination facility.

The total investment for the project exceeds US$4 billion. The project company will be jointly owned by Acwa and GIC with a combined 40% stake, while the Kuwait Authority for Partnership Projects will hold the remaining 60%. Fifty percent of the total shares will be offered for public subscription to Kuwaiti citizens once the project becomes fully operational and is listed on the Kuwait Stock Exchange.

Under the ECWPA, Mewre will purchase the entire net dependable power and water capacity of the plant, supporting Kuwait’s long-term plans to meet growing electricity and water demand through large-scale, efficient, and reliable infrastructure projects. 

The project will be executed by an international and local engineering, procurement and construction ( EPC ) consortium led by Sepco-III. The gas turbines for the project will be supplied and serviced by GE Vernova, while Acwa Operations will be responsible for the long-term operation and maintenance of the project throughout its 25-year term.

“The signing of this agreement is a major step in strengthening Kuwait’s long-term energy and water security,” says Acwa chairman Mohammad Abunayyan. “Az-Zour North Phase 2 and 3 is a project of national importance and reflects Acwa’s strong commitment to supporting Kuwait’s development ambitions. By bringing together our scale, efficiency, and global best practices, we aim to deliver reliable power and water at competitive costs, while demonstrating how strong public-private partnerships can create lasting economic and social value.”

Ibrahim AlQadhi, chief executive officer of GIC, adds: “We are proud to contribute to the development of strategic infrastructure projects in Kuwait through this project, which represents a landmark investment in GIC’s portfolio. GIC is a leading investor in power and water projects and intends to continue to play a major role in utilities projects in the Gulf.”