The Etihad Water & Electricity and a consortium consisting of ACWA Power and MDC Power Holding Company, an entity fully owned by Mubadala Investment, has entered into a water purchase agreement for a desalination plant in Umm Al Quwain.

The 150 million gallon per day desalination plant will utilize seawater reverse osmosis technology, a statement said.

It is strategically located between Ajman, Umm Al Quwain and Ras Al Khaimah.

Under the terms of the agreement, Etihad Water & Electricity will hold 20 per cent of the stake, while ACWA Power and Mubadala will each own 40 per cent. The government of Umm Al Quwain will join as a partner in the project and will own a stake at a later date.

Once commissioned, the Umm Al Quwain plant will be the largest desalination project in the northern emirates, the statement said.

Construction is expected to begin in the second half of 2019, with initial water production scheduled in 2021.

The project is part of the UAE’s effort to optimise water production and meet the increasing demand for water in the country.

Suhail Mohamed Al Mazrouei, UAE minister of Energy and Industry and chairman of Etihad Water & Electricity, said: “This project is Etihad Water & Electricity’s first asset in partnership with the private sector. Its implementation will reinforce UAE’s Water Security Strategy 2036 as well as bolster its core programmes.

“The plant is set to supply 150 million imperial gallons per day to the northern emirates and will prompt the private sector to further invest in those areas.”

Mohammad Mohammad Saleh, director general of Etihad Water & Electricity added that the plant will help meet the demands of both residential and agriculture sectors with competitive economical prices.