France’s Engie SA has agreed to divest its power and water assets in Kuwait and Bahrain to Saudi Arabia’s Acwa Power Co. for $693 million. The deal includes gas-fired electricity generation and water desalination assets, marking a strategic shift for Engie as it continues to pivot towards clean energy in pursuit of its net-zero emissions goals.
The sale encompasses stakes in three plants across Bahrain, with a combined capacity of over 3 gigawatts of power and the ability to desalinate 138 million gallons of water per day. Additionally, Engie’s interest in the 1.5-gigawatt Az Zour North project in Kuwait will also be transferred to Acwa. Acwa will assume responsibility for the operation of these plants upon completion of the deal.
Engie’s pivot away from fossil-fuel-based infrastructure aligns with its ambitious target to achieve emissions neutrality by 2045. The company’s focus is shifting towards renewable energy projects, making it less likely to engage in further gas-fired projects in the region. Engie’s manager for the GCC and Pakistan, Tomaz Guadagnin, emphasised that future projects in the Middle East will need to incorporate decarbonisation elements to align with international climate goals.
Acwa Power, which aims to reach net-zero emissions by mid-century, has been expanding its water business and recently secured its first desalination contract outside the Middle East and North Africa region in January. Following this deal, Engie will no longer hold any assets in Kuwait or Bahrain but will continue operations in other parts of the region, including the UAE, Saudi Arabia, Oman, and Qatar. Engie has expressed interest in securing contracts for renewable energy projects in Saudi Arabia and the UAE moving forward.
