Oil and gas-rich Qatar and Abu Dhabi have invited international companies to build and run large-scale power and desalination plants that will help them meet double-digit electricity and water demand growth driven by rapid industrialisation and population growth.

Qatar, which saw unprecedented electricity demand growth of 18% in 2006, recently invited companies to bid in June for the contract to build and run the Ras Laffan C independent water and power project, the country’s third.

The Ras Laffan plant will have capacity to produce as much as 2,600MW of power from 2010 and 55mn gallons a day of desalinated water from 2011, making it Qatar’s largest power and desalination facility.

In Abu Dhabi, the United Arab Emirates’ largest emirate, authorities are awaiting bids from companies in April for the contract to build and run the Fujairah 2 power and desalination facility.

Abu Dhabi’s sixth IWPP will produce 2,000MW of power and 130mn gallons a day of water by 2010.

Persian Gulf countries, flush with cash from three years of high oil prices, are spending billions of dollars on new infrastructure and industrial projects to diversify their economies and create jobs for their fast growing population. This in turn is driving up demand for electricity and water.

Abu Dhabi, home to 1.3mn people, will see annual power demand rise by 10.3%, or 900MW, between 2010-13. Growth will average 3.3%, or 400MW, per year between 2014 and 2020.

Peak electricity demand will reach 14,340MW in 2020, about three times last year’s level.

In neighbouring Qatar, the power demand will increase by about 17% annually between 2007 and 2010 from 4750MW now.

Demand for desalinated water is rising at a similar pace as power in Qatar and Abu Dhabi. Due to lack of rainfall in the Gulf region, countries rely heavily on water desalination.

The sheer scale of the capacity requirements have led some Gulf nations such as the United Arab Emirates, Qatar and Saudi Arabia to liberalise their power and water sectors to attract regional and international investment to help stem high project cost.

The Ras Laffan C and Fujairah 2 IWPPs are expected to cost each between US$2.5bn-US$3.5bn to implement, industry sources say.

Companies including International Power, Suez Energy and Mitsui Corp have traditionally been among the bidders for IWPPs in the region and are expected to submit proposals for both the Qatar and Abu Dhabi projects.

Plans are being drawn up to release tender documents for Abu Dhabi’s seventh IWPP, Shuweihat S2, by the end of the year.