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Egypt Prequalifies 17 Consortia for its Water Desalination Program

Sudanese and people from other nationalities cross the river Nile in a ferry, after being evacuated from Khartoum to Abu Simbel city, at the upper reaches of the Nile in Aswan, Egypt, April 30, 2023. (Reuters)
Sudanese and people from other nationalities cross the river Nile in a ferry, after being evacuated from Khartoum to Abu Simbel city, at the upper reaches of the Nile in Aswan, Egypt, April 30, 2023. (Reuters)
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Egypt Prequalifies 17 Consortia for its Water Desalination Program

Sudanese and people from other nationalities cross the river Nile in a ferry, after being evacuated from Khartoum to Abu Simbel city, at the upper reaches of the Nile in Aswan, Egypt, April 30, 2023. (Reuters)
Sudanese and people from other nationalities cross the river Nile in a ferry, after being evacuated from Khartoum to Abu Simbel city, at the upper reaches of the Nile in Aswan, Egypt, April 30, 2023. (Reuters)

Egypt has prequalified 17 consortia for the tendering process for the development of a number of sea water desalination plants, according to a statement released by Sovereign Fund of Egypt on Monday.

The desalination plants will be powered by renewable energy sources in various locations across Egypt under the first phase of the country's water desalination program, the statement added.

Egypt has been pushing to diversify its sources of fresh water for a fast-growing population as it faces competition for Nile River water from the giant hydropower dam that Ethiopia is building upstream.

The program involves launching projects with a total capacity of 8.85 million cubic meters a day by 2050, of which a 3.35 million cubic meter first phase is planned by 2025.

The foreign and local investors will develop, construct and operate the plants and transfer technology to manufacture components locally.

The European Bank for Reconstruction and Development and the International Finance Corporation will help structure and implement the first batch of desalination projects in partnership with the private sector, the Sovereign Fund said.

The prequalified consortia will be classified into four categories based on previous experience in desalination projects, the statement said.

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Insurance Costs for Ships in Strait of Hormuz Rise Over 60%

 The Strait of Hormuz is a key shipping chokepoint for crude oil (Reuters) 
 The Strait of Hormuz is a key shipping chokepoint for crude oil (Reuters) 
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Insurance Costs for Ships in Strait of Hormuz Rise Over 60%

 The Strait of Hormuz is a key shipping chokepoint for crude oil (Reuters) 
 The Strait of Hormuz is a key shipping chokepoint for crude oil (Reuters) 

Insurance prices for ships travelling through the Strait of Hormuz have jumped more than 60% since the start of the war between Israel and Iran as the conflict threatens shipping in a key chokepoint for crude oil, the Financial Times newspaper wrote on Wednesday.

As of this week, the cost of hull and machinery insurance for ships passing through the strait — a narrow waterway between Iran and Oman, connecting the Gulf to the Arabian Sea — as well as the wider Gulf area had risen from 0.125% of the value of the ship to about 0.2%, according to the world’s largest insurance broker Marsh McLennan.

This pushes the cost of cover for a $100 million ship from $125,000 to $200,000.

Hull and machinery insurance covers damage to the ship itself, as opposed to cargo or third-party liability.

“We’ve not yet seen a missile fired at a ship in the Arabian Gulf, so what it represents is the market saying, look, there’s definitely a heightened level of concern about the safety of shipping in the region,” Marcus Baker, global head of marine and cargo insurance at Marsh McLennan, told the Financial Times.

Prices could rise further, he added.

Ships trying to pass through the strait face a range of dangers, from electronic interference to attacks by the Iran-backed Houthi group and the threat of further escalation by Israel and Iran, said brokers and insurers.

On Monday there was a collision between two oil tankers near the Strait of Hormuz.

While the cause of the crash has not yet been publicized, one ship had transmitted atypical signals about its position, raising concerns about electronic interference.

Baker said insurers were also worried that Houthi militants could widen their attacks, damaging more ships than the US, UK and Israeli-flagged vessels they have generally been targeting.

The market is “concerned about every vessel” travelling through the area because of Houthi attacks, Baker said.

Some insurers could stop offering cover because of the risks, he added, but others might see any pullback as an opportunity.

“War itself, as an insurance product, tends to be...either you lose everything or make a fortune. And many fortunes have been made by underwriters prepared to take a risk,” he said.

Insurance rates for cargo, including oil, were also likely to rise because of the conflict, multiple brokers said, but had been slower to respond.