Britain's Biwater and two Gulf partners have been named preferred bidders for a contract worth Dh2 billion ($544.7 million) to build sewage treatment plants in the UAE.

France's Veolia and Singapore's Keppel Seghers were among the six groups of firms bidding for the deal, which also involves buying 40 per cent of Abu Dhabi's sewage sector in the Gulf's first such privatisation.

"Detailed discussions will take place with the preferred bidder group of Biwater and partners over the next few weeks," said Alan Thompson, managing director of Abu Dhabi Sewerage Services.

The preferred bidder will take a 40 per cent stake in a sewage company that will be set up, with the rest held by Abu Dhabi Water & Electricity Authority.

"We expect the whole process of technical, legal and financial clarifications to be completed by September this year," Thompson said.

Kuwait's Mohammed Abdulmohsin Kharafi & Sons and Abu Dhabi-based Al Qudra Holding are Biwater's partners in the project to build two sewage treatment plants in Abu Dhabi and Al Ain.

"Work is scheduled to start in October and commissioning of the plants will be in March 2010," said Thompson, whose company oversees Abu Dhabi's sewerage sector.

The Abu Dhabi plant will have a capacity of 300,000 cu m per day (cmpd) while that of the Al Ain plant will be 65,000cmpd.