Cairo puts $160m price tag on desal

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As the reconstruction of Egypt’s political order continues, planners are keen to resurrect plans for new desalination plants. Where will the funding come from?

Egypt wants to attract more than $160 million in external funding for desalination projects in coastal areas, according to the holding company responsible for managing the country’s water and wastewater bodies.

The Holding Company for Water and Wastewater (HCWW) is looking to restart its stalled desalination programme with new facilities on the Mediterranean and Red Sea coasts, and is considering both international development support and the private sector as potential sources of funding for the projects.

Mamdouh Raslan, the deputy chairman at the HCWW, told GWI that since the disruption to the political system caused by the revolution, the focus had been largely on the operation and maintenance of Egypt’s existing water and wastewater infrastructure. Now a measure of stability has returned following the appointment of a new government, however, Raslan told GWI that the holding company is starting to consider a budget for capital investment again, with desal being a key priority.

“We are seeking funding now for the interrupted project pipeline,” he confirmed. “I think there is a great need for desalination on the Red Sea, as there is on the north coast. We expect that we will need at least 1 billion Egyptian pounds [$164 million] for desalination in the years to come. This could come from the private sector or it could be from the development agencies. I think the need is great, so we are considering all the resources that could help.”

More than 99% of the potable water supplied in Egypt comes from the River Nile or from Artesian wells, but the pressure on non-renewable sources – added to disputes over surface water allocations with upstream countries – means that increased investment in desalination has long been an aspiration for the Egyptians.

The HCWW acts as an umbrella body for Egypt’s urban and rural water and wastewater utilities. Before the revolution in Egypt disrupted utility planning, the HCWW had been looking to construct three desalination plants with capacities of between 5,000m3/d and 20,000m3/d in the Red Sea, Sinai and Matrouh governorates, using a BOT-type contract structure.

This process was disrupted by the unrest caused during the revolution and the subsequent formation of the new government in Egypt. This has led to a restructuring process at the public bodies dealing with water and wastewater (see GWI August 2012). Most notable is the creation of a new dedicated Ministry of Drinking Water and Sanitation Facilities, which will take over responsibility for utility planning, which previously came under the remit of the housing ministry.

Raslan said that the HCWW would continue its role as before for the foreseeable future, although he cautioned that the longterm structure of the political oversight of water and wastewater in Egypt has yet to be decided. He did not specify whether the holding company would be resurrecting the exact desal projects that had been lined up in 2010 or whether it would be reconsidering specifications after tendering restarts.

He added that spending on leak detection and improving the potable water conveyance network would also be priorities for the HCWW.

The new utilities ministry is currently operating from the same building as the HCWW, and has already folded in bodies such as the Cairo and Alexandria Potable Water Authority (CAPWO) and the National Organisation for Potable Water and Sanitary Drainage (NOPWASD), as well as the national water regulatory agency, the EWRA. The new ministry is led by former HCWW chairman Dr Abdel Kawy Khalifa.

Raslan told GWI that the country’s water planners are working closely together to create a new political backbone for water and wastewater in Egypt. “We are lucky that we have a ministry for water and wastewater development,” he said. “And we are even luckier to have Dr Khalifa as minister, someone who knows all the corners and nitty gritty of the sector. We are optimistic that things can go back on track again, now that we have a voice in the cabinet talking about water and wastewater.”