Suez Environnement eyes major UAE contracts

French environment engineering and waste water management giant Suez Environnement hopes to win major contracts in the UAE in the face of fierce competition.

Suez Environnement, spun off by Suez as part of its merger with Gaz de France, is in the process of bidding for three major contracts in the UAE, according to the company's chief executive.

"We are in the process of winning major contracts in the Middle East by virtue of our proven track record, credibility and experience," Suez Environnement Chief Executive Officer Jean-Louis Chaussade told Emirates Business recently.

"We are waiting for the finalisation of a contract in Abu Dhabi for a desalination plant. Yet another is awaited in Muscat, then one in Makkah," he said ahead of his company's listing on the NYSE Euronext in Paris.

Suez is also finalising a series of contracts in Jordan.

Earlier, the group had won a $800 million (Dh2.93 billion) contract to design, build and operate a wastewater treatment and reuse plant at the Jumeirah Golf Estates project in Dubai.

The project is being executed by Suez's facilities operator and builder unit Degremont. The 10-year contract covers the installation and operation of a system to collect sewage and distribute treated water over 40 kilometres. Degremont's share of the contract is 54 per cent of the total amount. Suez Environnement has also explored businesses through joint ventures. In 2007 the company entered into a joint venture with Al Qudra to form Al Qudra Suez Services to identify, assess, evaluate and bid for business opportunities in the utilities field.

Through the partnership with Al Qudra, Suez Environnement will soon bid for two projects in Abu Dhabi and one in Al Ain. These are operations, maintenance and management service contracts at the water and electricity project in Abu Dhabi that will fetch $1.5bn per year, waste water treatment project in Abu Dhabi and electricity distribution project in Al Ain.

The business potential for waste water treatment, desalination and reuse have brought a handful of global majors into the region. Capital expenditure on desalination plants is projected to reach $14bn by 2015. Similarly, capital expenditure on reuse plants in the Mena region will hit $7bn.

Suez expects to bag a majority of these contract, particularly in the design, building and operate segment with its proven track record.

The Gulf, North Africa and other countries offer high growth potential.

"Management contracts or concession right models in these countries offer strong growth potential. Our operating conditions guarantee high quality of service and they generate regular revenue streams," said Joubrane Ouechec, senior vice-president for development (Middle East), Degremont.

Suez has been operating in the Gulf since the 1950s when its engineering consultancy division Safege discovered underground water resources that today supply Riyadh. The company built the world's largest hybrid desalination plant was built in Fujairah in 2003.