Genesis Morocco: Morocco axes Orascom-led group from solar project

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Genesis Morocco

Project Genesis is a strategic sustainable development framework for Morocco to translate from being a net importer of energy and a country facing water shortage issues, into the number one producer both of clean renewable energy and water in the region.

Friday, March 23, 2012    <<Home

Morocco axes Orascom-led group from solar project

Personal Notes: This is big news, and we at the blog (as well as it seems most other news outlets) are not sure why ORASCOM was excluded from the bidding process. Nor has there been any official word from the Moroccan Agency for Solar Energy (MASEN) as of yet. All we can do right now is speculate, and with that being said here are three possible (and, again, highly speculative) explanations why ORASCOM may have been excluded.

1) Phosphates --  ORASCOM is a major fertilizer producer, and to do so they have a robust business connection with Morocco's very own Cherifien Office of Phosphates (OCP). Perhaps certain members of Morocco's business or political community are worried about further ORASCOM inroads on what will be another valuable Moroccan product: solar power. After all, history shows that it is not always the best idea to have one company controlling large and varied sectors of your economy, more so if that economy is a multi-national.

2) Dirty dealing -- again, this is all highly speculative, but perhaps there was something less than savory (or even less than legal) about ORASCOM's bid preparations. This could explain the suddenness of the exclusion, as well as the lack of official explanation, as authorities would probably feel more comfortable giving a behind the scenes reprimand rather than cause a publicity nightmare for what remains one of Morocco's largest foreign business partners.

3) Partner problems -- the ORASCOM consortium was made up not only of ORASCOM, but also two other large energy firms: Evonik Steag and Solar Millennium. The latter has fallen on hard times, and just three months ago was forced to file for insolvency. Although it is not clear, perhaps these complications were worrying enough to justify an exclusion.

Let me stress (again) that we still do not have an official reason for ORASCOM's exclusion, and at present these are nothing more than speculation. Nonetheless, the exclusion of what was certainly a strong contender for the bid will doubtless have some serious consequences for the three remaining consortia, and the project as a whole.

Reporting by Souhail Karam, editing by David Cowell -- Friday, March 23, 2012
(Reuters) - Morocco has excluded a group led by Egypt-based Orascom Construction Industries from the bidding for the first phase of a major solar energy project, l'Economiste newspaper reported on Friday.

The newspaper gave no reason for the exclusion and a spokeswoman for Masen, the government agency managing the project, declined to comment.

Quoting sources familiar with the plan, l'Economiste said Masen would select a winner within a few weeks from the three remaining consortiums it selected in December, 2010.

The 500 megawatt project, in the southern region of Ouarzazate, is the first of five in a $9 billion solar programme that will account for 38 percent of Morocco's installed power generation capacity by 2020.

The plan is vital to a country without its own oil or gas and which aims to diversify its exports to an energy-hungry trade partner, the European Union.

The four consortiums selected to bid for the design, finance, construction, operation and maintenance of a thermal solar plant in Ouarzazate were:

- Abeinsa ICI, Abengoa Solar, Mitsui and Abu Dhabi National Energy Co.

- Enel and ACS SCE

- International Company for Water and Power (ACWA), Aries IS and TSK EE.

- Orascom Construction Industries (OCIC.CA), Solar Millennium (S2MG.DE) and Evonik Steag.

The Ouarzazate project is to start as a 125 megawatt unit and undergo gradual upgrades to 500 MW by the end of 2015.

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