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Middle East ESSENTIAL INSIGHTS FOR MIDDLE EAST WATER, GAS AND ELECTRICITY PROFESSIONALS August 2009 Vol 3. Issue 8 The GCC’s big budget blockbuster power and water projects IRAQ IN PROFILE A struggling utility sector in need of help WATER CONSERVATION How power and technology can make a difference to consumption An ITP Business Publication RENT, BUY OR LEASE Generator and compressor companies are still enjoying strong trading www.utilities-me.com OUT NOW! DIRECTORY
Transcript
Page 1: Utilities Middle East

Middle East

ESSENTIAL INSIGHTS FOR MIDDLE EAST WATER, GAS AND ELECTRICITY PROFESSIONALS August 2009 • Vol 3. Issue 8

The GCC’s big budget blockbuster

power and water projects

IRAQ IN PROFILEA struggling utility sector in need of help

WATER CONSERVATIONHow power and technology can

make a difference to consumption

An ITP Business Publication

RENT, BUY OR LEASEGenerator and compressor companies are still enjoying strong trading

www.utilities-me.com

OUT NOW!

DIRECTORY

Page 2: Utilities Middle East
Page 3: Utilities Middle East

CONTENTS

www.arabianbusiness.com August 2009 ● Utilities Middle East 1

2 COMMENTFor those that make it through the summer the Gulf could still be a land of opportunity.

4 REGIONAL UPDATEA round up of some of the biggest headlines in the region.

10 SPECIAL REPORTCan utilities release cash flow from tightened coffers?

12 INTERVIEWUME visits Vienna and meets with the IAEA’s Holger Rogner.

16 INDUSTRY OPINIONA look at how the generator and compressor sectors are doing.

20 TOP 10Some of the biggest power and water projects in the GCC.

24 WATER CONSERVATION Power sources and technology can combine to reduce water consumption.

29 COUNTRY PROFILE Iraq is in need of help from its neighbours if it is to get through a utilities crisis. 32 PROJECT TRACKERA select list of current regional utilities projects.

34 TENDERSOpportunities available in the Middle East.

36 EVENT HORIZONUseful utility events coming up over the next few months.

40 PEOPLE METER David Hogan of Varis Energy on the benefits of Zigbee based wireless technology.

August 2009 Issue 8

201216

Page 4: Utilities Middle East

COMMENT

2 Utilities Middle East ● August 2009 www.arabianbusiness.com

Middle East

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A sense of frantic pace left the region months ago. Summer’s onset could easily have you believe it is some way

from returning. However, some fundamental needs remain in play in the region’s utility sector.

As seasonal peak loads are reached during the scorching heat of August, it is worth remember-ing that capacity expansion is still coming second in the race with demand. There are billions of dol-lars worth of projects under way, from the earliest bid stages through to the close of construction, all aimed at pushing capacity into fi rst place.

Governments have pledged signifi cant invest-ment for power and water projects to make this happen. Buying their way out of a recession may turn out to be a happy side effect; utilties are not the only area of infrastructure to benefi t from investment. Wiley operators are also taking advantage of the opportunity to get a lower bid from contractors, as key material costs reduce from their 2008 peaks.

While the global fi nancial storm is proving a stern test for the GCC’s contractors, leaving them feeling battered by the economic head-wind, the sturdier businesses among them have adapted. Where business may have dropped off in one location, it is still available in others, just a bit further away.

Traditional revenue streams have also shifted. For instance, some equipment rental fi rms are doing well simply because their clients would once have bought the equipment they are now leasing instead. Other companies are working harder for new business and adapting what they offer to suit the current climate.

Whatever the process involved, while these conditions prevail it may be painful, but leaner, meaner and perhaps wiser businesses, with a new eye for opportunity, are emerging.

Stuart MatthewsSenior Group Editor

Land of opportunity?

Published by and © 2009 ITP Business Publishing, a member of the ITP Publishing Group Ltd. Registered in the B.V.I. under Company Registration number 1402846.

Sheer need will keep pushing the region’s utilities

Work on the region’s infrastructure needs continues.

Page 5: Utilities Middle East

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Page 6: Utilities Middle East

REGIONAL UPDATE

4 Utilities Middle East ● August 2009 www.arabianbusiness.com

First phase in GCC-wide network link powers up

Renewables to plug into gridBahrain minister backs role of renewable energy in powering the island kingdom

Fahmi Bin Ali Al Jowder, Bahrain’s minister in charge of the Electricity and Water Authority.

Bahrain’s Electricity and Water Authority (EWA) will soon allow renewable energies to feed power back into the national grid accord-ing to the minister in charge Fahmi Bin Ali Al Jowder.

Al Jowder said he recently appointed a national committee involving a number of ministries to study renewable energy options for the country, including how the pri-vate sector could contribute.

“Any renewable that is going to be produced by individual institu-tions has to feed back into the grid and they should get credit for that because we want to make renew-able energies enticing,” he said.

“But we have to assess how this will work and this is going to be part of the work that the committee will be doing.”

Green groups have long been calling for governments across the GCC to allow building’s with renew-able energies to tie into the grid and provide fi nancial incentives for every kilowatt hour put back.

Al Jowder said the committee held its fi rst meeting last week and is expected to make its fi rst rec-ommendations in nine months which he will present to Economic

Board of Development (EDB). He added that a higher committee was appointed by the cabinet two weeks ago which will look into nuclear energy options.

“We cannot continue to rely on natural gas to power our plants

Saudi Arabia, Qatar, Bahrain and Kuwait have all linked their power grids, in a landmark project that is planned to meet rising power demand and stave off outages.

The UAE and Oman will join the US $1.4 billion scheme in 2011.

Plans for the network link-up were first drawn up in 2004, and the first stages of the project have included the interconnection of the Qatar grid with Kuwait and the commissioning of the first

cycle of undersea cable between Bahrain and the main grid, both of which took place earlier this month.

“With the successful link-ing of the electricity grids of Saudi Arabia, Kuwait, Qatar and Bahrain, the member coun-tries are close to achieving their goal of having a joint power grid for all six member states,” said Yusuf Janahi, chairman of the GCC Interconnection Authority

(GCCIA), in a statement to the Arab News.

“The grid aims at guaranteeing an adequate supply of power even in emergencies and also reducing the cost of power generation in member countries. There will of course be other economic gains.”

The first phase of the project included a double-circuit 400kV, 50Hz line from Kuwait to Saudi Arabia. A similar line offers a sub-marine link to Bahrain.

Bids invited for Oman projectsThe Oman government has issued requests for proposals for two major independent power projects in the north of the country.

The projects, each with a capac-ity of 650 MW will be based at Barka and Sohar. The total capital invest-ment in the two developments is expected to exceed US $1 billion, more than 45 prospective develop-ers have already shown interest.

which means we have to move into other areas and this is what we have started doing,” he said.

“We are not just leaving it to even-tualities, we are trying to plan for our future and look into the differ-ent available technologies.”

Al Jowder said Bahrain was one of the fi rst countries to sign up the International Renewable Energy Agency (IRENA) which formed in January and aims to promote the rapid transition towards sustain-able us of renewable energy.

Page 7: Utilities Middle East

REGIONAL UPDATE

www.arabianbusiness.com August 2009 ● Utilities Middle East 5

Water for capital cityPipeline to convey water to Jordan’s capital Amman

Work on the pipeline is under way. When complete it will supply 100 milliom m3 per year.

A new US $1 billion project is being set up in Jordan to help alleviate a water shortage in the country’s cap-ital city, Amman.

The Disi Water Conveyance Proj-ect includes the construction of a 325km pipeline that will drive water from the Disi aquifer in Mudawarra to the capital. The project will be con-structed thanks to funds that came from Gama Energy, a joint venture between Gama Holding and GE Energy Financial Services.

The investment will create jobs and promote private sector participa-tion in Jordan’s development.

Commenting on the Disi project, Prime Minister Nader Dahabi of Jordan said: “This project represents a milestone towards ensuring water security and addressing the coun-try’s water shortage.”

Jordan’s water resources per capita are among the world’s lowest. Water is delivered only once a week to Amman’s residents. The Disi Water Conveyance Project is expected to supply Amman and sur-rounding areas with more than 100 million m3 of water per year.

“We take pride in the vote of con-fi dence we won from the fi nancial community by closing a $1 billion project amidst the worldwide eco-nomic downturn,” added Gama Energy managing director and board member Arif Ozozan.

The fi rst in a series of funding was made today, with construction expected to begin this month.The project’s construction is expected to take four years. It will use an esti-mated 250 000 tonnes of steel and involve the digging of 55 wells.

Gama Energy will invest approxi-

mately US $190 million, the Ministry of Water and Irrigation of Jordan will provide a US $300 million grant, while the Overseas Private Investment Corporation of the US, the European Investment Bank and Proparco of France will collectively provide US $455 million in debt fi nancing.

In 2007, the Government of Jordan awarded GAMA a concession to build and operate the water pipeline. The fi rm will own the project for a 25-year concession period, after which it transfers to the Government of Jordan.

SETE SUCCESSSete Energy has won the contract to complete the stage 3 expansion of an industrial wastewater treat-ment plant for Marafi q. The project is located in Jubail and encompasses the design, engineering, procurement, construction, testing and commissioning of a new plant that will expand current capacity by 55 000m3/day. Milan-based Foster Wheeler Italiana (En-vironmental) will provide detailed process design services to Sete Energy. The project is scheduled to take 24 months to complete.

PURE WATERMetito has been sub-con-tracted by Samsung to de-sign, manufacture, supply, install and commission a demineralisation plant for the Shuweihat S2 IWPP in Abu Dhabi. The plant will produce high purity water to feed the boilers generat-ing steam for the power turbines. The contract value is AED 6.35 million.

DESALINATION COSTSThe maintenance and re-construction of desalination plants under the control Saudi Arabia’s SWCC is expected to cost up to 1.4 billion riyals in 2010. SWCC will be attempting to rely solely on locally manufac-tured spares for the work. This move is part of the SWCC’s desire to support the national economy, encourage local manufac-turers and achieve its aim of creating a nationally self-suffi cient desalination industry.

HIGHLIGHTS

US $1.26 billionThe value of the GCC market for water and wastewater treatment equipment in 2008.

Marafeq Qatar lands a bumper utilities dealMarafeq Qatar has agreed to an MoU arrangement with the Lusail Real Estate Development Company whereby the former will provide the design, construction, fi nancing,

maintenance and operations of utili-ties at the Lusail City development.

The fi rm will cover district cooling, waste collection, gas supply and will also provide the water and electric-

ity network studies at the 35 km2 site, which is located just north of Doha.

“Marafeq Qatar’s utility solu-tions will signifi cantly contribute to our vision of Lusail as a breathtak-ing development that will dramat-ically improve our country’s eco-nomic and physical profi le,” said Mohamed Bin Ali Al Hedfa, CEO of Lusail Real Estate Development, according to the Gulf Daily News.

Work will start in two of Lusail Development’s busiest sites, the Marina District and Fox Hills, before spreading across the whole of the project.

Source: Frost & Sullivan (see story p25)

Page 8: Utilities Middle East

REGIONAL UPDATE

6 Utilities Middle East ● August 2009 www.arabianbusiness.com

Bahrain moves to fi nance vast utilities deals

Bangladesh inks deal on major power projectRolls-Royce, a power systems company, has announced that it will provide a 40MW power solu-tion for the biggest shopping and entertainment complex in Asia.

Jamuna Builders has ordered six Rolls-Royce gas engines to provide power for its Jamuna Future Park, now under devel-opment in the Bangladeshi capital, Dhaka.

The six, 16 cylinder, gas fuelled engines will generate electricity in power.The project is a large-scale seven-floor development combining leisure, retail and exhibition facilities.

The Rolls-Royce plant will pro-vide power for facilities including 118 escalators, 26 large lifts, three mobile walkways, a hypermarket, entertainment centres and a chil-dren’s theme park.

The power plants will be sup-plied in two phases. In the first phase, three engines will be deliv-ered by the end of 2009, each driving an electrical genera-tor to supply 6.81MW of uninter-rupted power, independent of the region’s grid.

Bahrain’s cabinet has approved plans to obtain a US $1.3 billion loan to fi nance power and water projects in the country.

Of this sum, US $849 million will be spent on upgrading 220kV and 66kV electricity projects over the next fi ve years. The other $477 mil-lion will go towards improving Bah-rain’s water network.

The same cabinet session also approved the building of 10 more power stations, the expansion of four others, and the installation of

380 km of underground cables. Bah-rain is already building 29 66kV sta-tions, and expanding the water grid.

Limited recourse fi nancing for the US $2.1 billion Al-Dur IWPP proj-ect has also been completed, accord-ing to an announcement from The Gulf Investment Corporation (GIC) and French engineering contractor GDF Suez.

“The success of this major fi nance agreement is strong evidence of the confi dence of the banking com-munity in the strength of the con-

Energy potential in KSASiemens CEO backs renewables as part of Saudi energy mix

Peter Loescher, CEO of German industrial giant Siemens.

The CEO of Siemens has said the potential for renewable energy projects in Saudi Arabia is huge, while declining to comment on whether the company would help Middle Eastern countries with their nuclear power ambitions.

“Projects with renewable ener-gies have a huge potential in Saudi. The country has very large areas which would be suitable for wind or solar power due to its geograph-ical position – investments which would pay off very quickly,” said Peter Löscher in an interview with Arabian Business.

Switching to an energy mix with a signifi cant share of renewables would allow Saudi to retain its oil reserves for a longer period of time, the global head of the German con-glomerate added.

Earlier this month, Siemens was one of 12 major European compa-nies to sign a declaration of intent to build a series of solar thermal power plants in the Sahara desert that would supply Europe with up to 20 percent of its energy by 2050.

The project, called Desertec, would require an investment of

sortium and the economic devel-opment of Bahrain,” Guy Richelle, CEO of GDF Suez Energy MEAA region said in a statement.

A group of fi ve prominent insti-tutions have entered as new share-holders in the project. The Social Insurance Organization of Bahrain, Instrata Fund, Capital Management House, Bahrain Islamic Bank and First Energy Bank have joined GDF Suez and GIC in the project. GDF Suez will remain the largest share-holder with a 45% stake.

around US $571 million.Löscher declined to comment on

whether Siemens had plans to help the UAE, or any other Middle East-ern countries, with their nuclear power ambitions.

The company is currently embroiled in a bitter dispute with France’s Areva to exit the two com-panies’ US $2.855 billion joint ven-ture in developing new nuclear reactors.

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Earlier this year Seimens announced a deal with Rosatom, the Russian state owned nuclear group, to create another joint venture.

“The talks with both companies are ongoing, so…I cannot com-ment on any questions related to those business activities,” he said.

“But one thing is clear: In the future there is a huge potential for such kind of business.”

Billion kilowatt hours of electricity imported by Iraq during 2008 (estimated).

See story page 29

Page 9: Utilities Middle East

REGIONAL UPDATE

www.arabianbusiness.com August 2009 ● Utilities Middle East 7

SEC extends key bid deadline Falling costs could bring savings to company as it gives bidders more time

SEC is looking for cheaper bids for its 2400MW Rabigh project.

Citing the possibility of saving money due to a fall in costs, Saudi Electricity Company (SEC) has extended the deadline for bids to build a 2 400 MW power plant in Rabigh by three months.

The estimated cost of the plant has dropped by 20% to around US $4 billion. Contractors now have until October 31 to submit their bids.

The Rabigh expansion accounts for around 12% of the extra 20 000 MW SEC is planning to come online between now and 2018, at a total cost of US $80 billion. SEC has also signed a deal with a Korean consortium to build a 1,200MW power plant in Rabigh. The consor-

tium is led by Korea Electric Power Corporate and includes Saudi fi rm ACWA Power International. SEC will own a 20% share of the project.

The plant will be built in two phases, with 600MW coming online in 2012 and the remaining 600MW becoming available in 2013.

Funding for this and other proj-ects seems secure after the SEC signed a US $690 million loan (SAR2.6 billion). A recent research note from the Kuwait Financial Centre ‘Markaz’ asset manage-ment fi rm stated that Saudi Arabia was responsible for around 56% of the GCC’s total electricity usage between 2002 and 2007.

Page 10: Utilities Middle East

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Page 11: Utilities Middle East

REGIONAL UPDATE

www.arabianbusiness.com August 2009 ● Utilities Middle East 9

Capacity needs boostReport identifies big generation gap that needs plugging

More capacity needs to make it off the drawing board and into active service to meet the region’s power needs.

The GCC still requires invest-ments totaling US $37.1 billion to add another 24,734 MW of genera-tion capacity to its grid by 2014 if it is to match the growing demand for power in the region.

That’s according to a report published by the Kuwait Finan-cial Centre ‘Markaz’ asset man-agement fi rm, which explains that population growth and increased immigration is leading to increased

Kuwait (13%) were the largest total consumers of electricity between 2002 and 2007.

The Markaz note also reported that countries with a strong macro-economic outlook, such as Qatar, would fi nd it easier to complete required infrastructure work, but noted that others might need to fi nd alternative means of fi nancing mega projects, such as debt issu-ances and large loan syndicates.

demand for modern and effi cient infrastructure.

The report says the growing demand for power has meant that installed capacity increased from 46,579 MW in 2002 to 73,339 in 2007, at a rate of 10% a year. Saudi Arabia and the UAE together accounted for 72% of the region’s installed power generation base in 2007.

However, Saudi Arabia (56%) and

ABB wins US $34 million Saudi power job to improve network

Yanbu turns to Korea for a power increaseSaudi Arabia has signed a US $720 million deal with a South Korean fi rm to increase energy output at Yanbu Industrial City, it has been reported.

Marafi q power and water util-ity company awarded the con-tract to Hanwha Engineering and Construction Company to build two steam turbine genera-tor plants at Yanbu, reported the Saudi Gazette.

“Because of the rapid indus-trial expansion of Yanbu, the new power generation plants will greatly enhance our power capac-ity and will help us meet the ever-growing utility demand of the industrial sector,” said Thamer Al-Sharhan, president and CEO of Marafi q.

Construction work is expected to take 36 months. Once oper-ational the plants will increase Marafi q’s power output to 1 500 megawatts.

The fi rst unit is to start commer-cial production by May 2012 and the second to be commissioned by July 2012.

The Yanbu Industrial City is undergoing major expansion works, like Jubail. Offi cials said subcontract work will go to local contractors who meet the stan-dard criteria, the paper reported.

ABB has won a US $34 million (SAR128 million) order from Saudi Arabia’s national power transmis-sion and distribution utility, Saudi Electricity Company.

The work will involve correcting the power factor to increase capac-ity and effi ciency in the power grid and include the refurbishment and

expansion of 20 distribution substa-tions to strengthen the network in the western provinces of the country.

This is expected to enable the Saudi Electric Company to meet growing demand for electricity and improve power quality.

“ABB is already executing sev-eral turnkey substation projects in

ucts supplied will include capacitor banks, medium-voltage switchgear, protection and control equipment, and a Supervisory Control and Data Acquisition system that will enable the utility to manage the fl ow of power in the network. The project is expected to be completed by the end of 2010.

the region,” said Peter Leupp, head of ABB’s Power Systems division. “These new projects will support the country’s efforts to increase power capacity and grid reliability.”

ABB is responsible for the design, engineering, supply, installation and commissioning of the measures to improve the substations. The prod-

Page 12: Utilities Middle East

SPECIAL REPORT: CASH FLOW

10 Utilities Middle East ● August 2009 www.arabianbusiness.com

Finding cash in the utility George Sarraf looks at ways to find much needed cash in the supply chainExecutives need to actively seek out ways to preserve cash in supply chain management (SCM)-related activities. By engaging the CFO and the executive team in an active review of current and planned expenditures and programmes, util-ity companies can fi nd and free cash in various areas of the supply chain.

The fastest way to preserve SCM-related cash is to stop buying. It may seem like an obvious step, but many companies do not change their spending patterns until inter-nal operating and capital budgets are scaled back. Of course, utility companies that stop buying can’t shut down purchasing activity com-pletely. Instead, most can benefi t from an aggressive, comprehen-sive review of major spend on open orders, as well as expenditures committed.

Many of these orders and requests were likely generated before the economic shift and represent future

work that is being deferred or cut from budgets. By sorting outstand-ing orders and requisitions, man-agement can fi nd opportunities to cancel or defer requirements. Sup-pliers and contractors may balk at cancelled orders, but they under-stand current economic challenges and many are willing to make sig-nifi cant short-term concessions for long-term stability.

Inventory is another area of immediate cash conservation, as well as an opportunity to cancel or delay open orders to avoid future cash leakage. For example, one util-ity re-examined its transmission and distribution (T&D) inventory and realised that a number of transform-ers were stockpiled in one region for a major reliability project that was delayed. The company redeployed these transformers to other regions, enabling cancellation of open orders and requisitions, saving the utility a major cash outlay.

This is also a good time to reex-amine overall inventory levels. Over the last few years, most utilities have been scrambling to ensure that material was available to support an increasing workload. The aftermath of storms and an overall increase in demand were taxing suppliers’ abil-ity to deliver suffi cient quantities of

many basics such as transformers, leading to concerns about supply security. As a result, many utilities increased inventory levels, absorb-ing cash in the process. As overall demand drops and supply concerns have eased, there may be more inventory on hand than needed. One utility recently analysed its inven-tory to determine where it could be reduced and found that 80% of items were overstocked relative to its tar-gets. Even after adding inventory dollars to restock needed items, this represented a signifi cant opportu-nity for net inventory reduction and cost savings.

Accounts payable terms and pro-cesses are another potential source of near-term cash. This does not mean utilities should abuse suppli-ers by arbitrarily delaying payments. Rather, they should seek out cash-saving opportunities. For exam-ple, most utilities have agreements with a portion of their suppliers that

George Sarraf, principal with Booz & Co.

Page 13: Utilities Middle East

SPECIAL REPORT: CASH FLOW

www.arabianbusiness.com August 2009 ● Utilities Middle East 11

either allow the utility to pay quickly in return for a specifi ed cash dis-count (ie: 2% when the invoice is paid in 10 days) or to pay the full amount in 30 days.

Possibly the most signifi cant way to reduce procurement costs for materials and services is to rethink

spend category strategies. In many cases, suppliers have been passing along major increases in their cost of business due to price pressures on commodities such as steel. How-ever, overall price increases may not have refl ected the true underlying costs across the supply chain. There is an opportunity to reevaluate and renegotiate category strategies and pricing arrangements with an eye toward different arrangements - for example, fair-return pricing.

In a fair-return pricing arrange-ment, the buyer agrees to pay the supplier a price tied to the under-lying fundamental costs of mate-rials or services rather than per-ceived supply and demand balances. This generally means that the sup-plier will make more in a downturn but less in an up-cycle. However, this structure also provides suppli-ers with more consistent income streams. Similarly, the buyer may appear to pay a bit more during the

down-cycle, but generally will pay much less in the up-cycle, particu-larly when there are price spikes in the market.

Suppliers are now much more open to discussions about alterna-tive strategies and pricing structures as their businesses are challenged by the downturn. However, utilities have to be prepared for these discus-sions to structure a true fair-pricing arrangement. To do so, the executive team must understand the total cost and dynamics of the supply chain

For example, at one utility, such cost modelling identifi ed an addi-tional 7% price reduction for power transformers. While the supplier had reduced its prices, the cost model-ling exercise revealed that it was also pocketing a portion of the price differ-ential as commodities fell, whereas it generally passed through all of the increases during the up-cycle.

“One utility recently analysed its inventory to determine where it could be reduced and found that 80% of items were over-

stocked relative to its targets.”

7%Price reduction for power transformers identified through cost modelling.

Page 14: Utilities Middle East

INTERVIEW

12 Utilities Middle East ● August 2009 www.arabianbusiness.com

Holger Rogner of the International Atomic Energy Agency speaks to UME about the place of nuclear power within the energy mix

Energy system

INTERVIEW

www.arabianbusiness.com12 Utilities Middle East ● August 2009 www.arabianbusiness.com

Page 15: Utilities Middle East

INTERVIEW

www.arabianbusiness.com August 2009 ● Utilities Middle East 13

I n the early 1950s a landmark speech, delivered by the then US President Dwight Eisen-

hower, proposed the idea of an in-ternational body that would over-see and support the development of atomic energy.

Just a year later the Interna-tional Atomic Energy Agency (IAEA) came into being. Since then, the organisation has evolved to embrace a wider energy remit, with a particular focus on develop-

ing countries.Holger Rogner is a pro-gramme leader and

section head, Plan-ning and Eco-nomic Studies Sec-tion (PESS) for the

IAEA’s department of nuclear energy. His portfolio of responsi-bilities includes capac-ity building in devel-oping countries for energy and environ-mental analysis.

“This isn’t just nuclear specifi c,” he said. “We look at the full energy system.

This involves looking at resource endowment, through to technologi-

cal capabilities, support-ing infrastructure, and what

the cost-optimal energy mix is over the next 25-30 years. Meet-

ing energy security objectives and measuring environmental impact are the main thrusts of my remit.”

In this context Rogner sees the development of a nuclear industry in the Middle East as a rational deci-sion, regardless of oil wealth.

“If the oil price is high, countries

in the Middle East can get more economic benefi t from selling that oil, rather than burning it at home,” he said.

“You have to diversify your energy systems. Even if now you are well endowed with oil and gas, in the long run you may fi nd that it is simply too precious to simply stick in a power plant. Other sectors such as transport and petrochemi-cals rely on these resources too.”

It is a strong argument and one that regional leadership has been keen to latch on to. Nuclear pro-grammes would also help diver-sify the economies of participating nations. Spin offs from the nuclear industry are expected to be high

value and knowledge based, qual-ities sought by regional economies.

“People often wonder why Saudi Arabia would want a nuclear power industry,” said Rogner. “But from a pure economic analysis, it makes sense.”

The long-term commitment and heavy-weight fi nancing required for a nuclear programme make it tricky for countries to get out of the starting blocks. While public-private partnerships have been mooted, none have got off the ground.

“These PPPs are certainly something we have looked into, but nothing has materialised,” said Rogner. “In those countries where it was most needed, government-private partnerships of this kind are more or less unprecedented. Nobody really knows how it would function, and nobody wants to be the guinea pig.”

That said Rogner still sees room for manoeuvre in traditional nuclear powered countries. He cites European nations where site planning and environmental anal-ysis has been done and things continue to progress, regardless of the fi nancial downturn. Part of the reason for this is the estab-

lished funding of European utility companies.

Further support for continu-ing European programmes comes from the need to improve and replace existing capacity. Many of the current crop of power plants came on stream in the 1970s and are gradually reaching the end of their technical lifespan. In coun-tries such as France and the UK the IAEA’s role is primarily a safety one, because these nations can do their own capacity planning and economic analysis. This puts the

IAEA’s emphasis on working with developing countries.

“Their focus is driven not only by market activity and energy security, but also real demand-side energy issues,” said Rogner. “To advance their own economic development aspirations they have to produce more energy.”

The resurgent interest in nuclear energy has been sparked by a com-bination of factors. Issues of energy security, climate change and vol-atile energy pricing have all made nuclear look good. This has lead to a number of countries wanting to join the nuclear pack. Rogner identifi es India and China as the main contenders ‘by a long-shot’. But these are not the only countries giving it consideration.

“Other developing Asian coun-tries also have grid capacities that would accommodate a nuclear power option,” said Rogner. “Many are not yet at a stage where nuclear would fi t into the system as an eco-nomically viable part of the matrix. Nuclear power is not something you can dip into, switch on and switch off. It’s a long term commit-ment which requires a substantial infrastructure development.

“In order to develop this infra-structure you need the educa-tional support structure, and you can’t start that early enough. Even if nuclear is on a country’s horizon 20 or 30 years from now, all of the development that can be started now is benefi cial.”

Development for China is an issue of need and nuclear is one among many options the country is exploring. But it and all other countries interested in nuclear as an energy source must consider a

“People often wonder why Saudi Arabia would want a nuclear power industry,

but from a pure economic analysis, it makes sense.”

INTERVIEW

www.arabianbusiness.com August 2009 ● Utilities Middle East 13

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INTERVIEW

14 Utilities Middle East ● August 2009 www.arabianbusiness.com

“Time and again we see these cycles in any resource based indus-try. You can draw lots of parallels with oil, where the industry starts looking in lower-concentration environments, deploying newer,

more expensive technology.“There are enormous amounts

of uranium resources locked in unconventional forms. The ulti-mate back-stop technology would be extracting uranium from sea water. Through recycling and re-use you can automatically convert

host of issues. First among these is overall grid capacity.

“We have a rule of thumb that the largest unit should not exceed more than 10% of grid capacity,” said Rogner. “So in case a plant has to come off the grid, the whole system isn’t negatively affected. When you limit the scope to the countries that this applies to, the list shrinks quite fast.

“You also need to look at the fi nancial capacity. Nuclear energy has high up front costs but is cheap to operate. To get to the bene-fi ts of cheap operation you have to overcome the hurdle of initial investment.

“There are not too many coun-tries that can fund that out of petty cash. What we have seen is coun-tries like the United Arab Emirates, which has the cash and the history of involving outside help, being in a unique position to move faster than countries such as Vietnam, Indone-sia or Malaysia, where the cash and cultural aspects are quite different.”

When it comes to other resources, specifi cally uranium, there is not much of an issue to answer. Resource availability is an interplay between demand, prices, technological development and knowledge. While these are rarely in synch, uranium is plentiful. How-ever, that fact hasn’t stopped the uranium market being out of bal-ance since the collapse of the Soviet Union. For several years, Rogner says, production was at 40% – 60% of the reactor requirement glob-ally. This was because of all the fuel that was stockpiled in the cold war. This reduced the need for explora-tion and mines closed because they weren’t viable. As nuclear plants in the US were given lifecycle exten-sions the market began to panic and uranium prices shot through the roof.

“Companies then began pull-ing 80-year-olds out of retirement – uranium geologists, experts in the fi eld – and now things are return-ing to normal,” said Rogner.

Holger Rogner: “We have a 19 point plan which we share with what we call the newcomers.”

and extend the fuel’s life for several hundreds or thousands of years, so scarcity is not really an issue.”

While current economic issues have created problems of all sorts, not just for power, few countries

are ready to move ahead with their programmes, though planning for nuclear development is continuing.

“It’s a 15 year process and they know that if they recover from the current economic crisis, they will be faced with capacity problems,” he said.

“We have a 19 point plan which we share with what we call the new-comers. Countries need a nuclear law, they must adhere to all the international agreements and trea-ties and conventions, otherwise nobody will sell you the technol-ogy. You need a regulator, you need a safety culture, you need an educa-tional framework.”

Rogner says it is not unusual for countries to want a high localisation factor, to keep most of the value in the country. Key to achieving that is a home-grown quality workforce.

“These things cannot be done overnight and so a timely plan is necessary. That’s what we try to convey to countries; the scale of what’s necessary to achieve a safe nuclear industry,” said Rogner.

“A domestic support structure is extremely important, but other considerations such as where do I get my fuels from, how do I deal with my waste etc. These do not all have to be in place 10 years before, but they must be on the radar, and be worked towards.”

“What we have seen is countries like the UAE, which has the cash and the history of involving outside help, being in a unique position to move faster than countries

such as Vietnam, Indonesia or Malaysia”

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16 Utilities Middle East ● August 2009 www.arabianbusiness.com

INDUSTRY OPINION

MarketUME asks three sector leaders in generators and compressors how business is shaping up in 2009

T he global fi nancial crisis has become the biggest infl uencing factor for just about every industry. While its effects have been widely felt, compa-nies continue to adapt to the new market conditions.

The sales and rental market for generators and compressors is a case in point. Although there have been signifi cant changes in the region, companies remain focused on their core businesses, while working hard to take advantage of what-ever competitive edge they may have. For some this is renewed endeavour in

sales and marketing, for others it is research and development, and others are staying steady on a long-term course.

Whatever the case, while things are defi nitely tougher, opportunities are still out there. UME talks to rep-

resentatives from three generator and com-pressor companies to see how they

are fi nding business…

view

16 Utilities Middle East ● August 2009 www.arabianbusiness.com

INDUSTRY OPINION

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INDUSTRY OPINION

How’s business? We speak as both buyers and pro-viders of generators.

Business has been slow for the fi rst quarter and has slowly picked-up in the second quarter of 2009. Every industry has been quiet for the fi rst and second quarter. Sev-eral projects were moved from the fi rst and second quarter. This means that projects were not totally cancelled, but clients were probing the status of their fi nancial situa-tion, and this has led to delay some of the projects.

But when the summer season started to peak, orders from vari-ous industries started to pour in. We believe that companies in the UAE have already sorted out their fi nancial models and were able to stabilise their cash fl ow problem.

Currently, RSS is still buying equipment to meet the demand of the UAE market and the GCC in general. The demand for rental power (as well as rental cooling)

exceeds our supply. As a rental provider, we always expect that summer will be our peak rental period. There are companies that require additional cooling capac-ity and that is why they need tempo-rary chillers and the rental genera-tors to power them.

Furthermore, the projects which were put on hold in the fi rst quar-

ter of 2009 have started to resume in the third quarter. We are now seeing construction projects and various industry activities gain-ing momentum. These two fac-tors (seasonal peak demand and resumption of projects) are our economic barometer, which tells us that there is a light at the end of the tunnel.

How has the focus of your business changed since the ‘economic downturn’? Our tactical plans were adapted to the changing business climate, so our sales efforts were doubled, operations have been more effi -cient and recruitment was put on hold. But, as a rental provider of generators and chillers, our strat-

egy remains the same. Our strate-gic plan is to expand geographically in the GCC, then the Indian subcon-tinent, then Africa, then Asia. Our focus is to penetrate new territories and manage them sustainably.

Have you seen a geo-graphic shift in the source of your business, if so where to?

Dubai has been our main market since we started in business. How-ever, several cities in the Gulf have been active even during the eco-nomic downturn. The demand for rental power and cooling in Abu Dhabi, Doha, Riyadh, Al Khobar and Jeddah has started picking up. I would not call it geographic shift but geographic dispersion. There-fore, the rental power business will still support the Dubai market and simultaneously support emerg-ing markets like Abu Dhabi, Doha, Riyadh, Al Khobar and Jeddah.

What are your plans for surviving and thriving as a busi-ness over the next 18 months?Our strategic goal is to expand geo-graphically by targeting new terri-tories in the Middle East, the Indian sub-continent, then Asia.

Late last year, we signed a joint venture with one of the biggest con-glomerates in Saudi Arabia and Bahrain, the Al Shoaibi Group. Early this year, we appointed Dyarco, a subsidiary of Al Faisal Holdings, to look after the Qatar market. And last month, we have inked a joint venture with Mubada-rah Investment for our Oman oper-ations. I believe that RSS will be able to expand its geographic reach in two more territories within 18 months.

Are you experiencing any new technology demands from customers and how are you responding to them?Customers are geared towards effi -ciency, to save money.

What’s your one top tip for surviving and thriving in the economic crisis?Managing cash fl ow is the key to surviving the current economic condition. In macro management, I would suggest that managers need to identify, fi nd options and install the most pragmatic busi-ness model that will adapt to the current condition.

“Currently, RSS is still buying equipment to meet the demand of the UAE market

and the GCC in general.”Lee Cox, RSS

RSS kit in operation on site in Dubai, where summer sees the peak rental period for portable cooling equipment.

LEE COXRSS

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INDUSTRY OPINION

How’s business? Under the current economic cli-mate our impression is that business for Atlas Copco is generally good. Order intake and revenues have been put under pressure, but this is same for everyone. The market is dynamic, ever changing, and market share is always a better indicator of how well our business is developing. We adapted our local strategies early enough when the market showed signs of slowdown, which today we see has increased our market share.

How has the focus of your business changed since the ‘eco-nomic downturn’? Whether in times of economic boom or struggle Atlas Copco’s focus has always been, and will continue to be, to offer our customers the best over-all value for our products and ser-vices. We see some market sectors [where] we give additional attention, as not all sectors presently suffer, but generally speaking our focus remains unchanged.

Has there been a change in the balance of your business, between sales and rental, or in the length of contracts? The resultant weakened customer confi dence from the crisis has ben-

efi ted our rental operations. Some companies opt to rent, in lieu of cap-ital investment, as there’s not yet any guarantee of timing to when major works contracts will be released. This is clearly apparent as Atlas Cop-co’s rental operations growth has accelerated in the last 12 months. We also see an increased contribution by our aftermarket business.

Have you seen a geographic shift in the so urce of your busi-ness, if so where to? Overall, only in relative small per-centages. Of course the enhanced downturn of the construction market in Dubai has impacted the contribution by the UAE. Mean-while, we see other areas where business fl ourishes, such as Saudi Arabia and Lebanon.

What are your plans for surviving and thriving as a busi-ness over the next 18 months? Simply put, we have to continue to offer more value. Customers don’t buy a product, but rather a sum of performances and services. Their choice is based on foreseen superior value versus the competitor offer.

Are you experiencing any new technology demands from customers and how are you responding to them? We see this as the other way around. Atlas Copco’s strategy has been

to continually innovate and intro-duce new products, or enhance cur-rent products, to be even more com-petitive in the market. The depth of Atlas Copco as a company allows us to continue to invest in new products and technologies, keeping us ahead of the competition. The goal is to increase our customers’ productiv-ity through innovative solutions.

For example, 80% of our Portable Division (diesel-driven air compres-sors and generators) product port-folio is less than three years old in design. This year is no exception as thus far we’ve introduced two new compressor ranges, two new genera-tor ranges and a new dedicated light-ing tower, which is up to 20% more eff icient in fuel use versus most com-petitor offers.

Parallel to technological demands, Atlas Copco also gives great atten-tion to the environmental impact of our products. Our compressors and generators offer better fuel effi ciency, less

noise, and protective features such as spillage-free containment bases helping protect the local environ-ment. We see this as our obligation to ensure the environmental impact is minimised.

In light of this, another excit-ing new technology is our Carbon Zero, TÜV certifi ed range of air com-pressors, where our customers can now recover up to 100% of the input energy by converting the input elec-trical energy into heat through our built-in energy recovery system.

What’s your top tip for thriving in the economic crisis? Exceed customer expectations. Offer top quality products and ser-vices, and making certain their inter-ests are kept in the forefront of each employee’s mind. If we don’t take care of our customers, then certainly someone else will.

Atlas Copco has seen a rise in its rental operations following the downturn.

MICHAEL SAGERMANNATLAS COPCO

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INDUSTRY OPINION

How’s business? Business is now picking up after a slow start. All markets sectors were quiet compared to last year, but there are signs that confi dence is begin-ning to return.

How has the focus of your business changed since the ‘eco-nomic downturn’? Our focus has always remained the same. To ensure our customers receive professional advice, service and support. In the case of new busi-ness opportunities we remain com-mitted to providing technically cor-rect and energy effi cient solutions. The only real change has been to ensure we leave no stone unturned in pursuit of potential new business.

Has there been a change in the balance of your business, between sales and rental, or in the length of contracts? Kaeser is not directly involved in the rental business. Through our network of dealers we offer sales and after sales service of both con-struction and stationary compres-sors. Having said that, we are aware that some clients have chosen the rental route for a short term with a view to reviewing the market again at a later date.

What are your plans for surviving and thriving as a busi-ness over the next 18 months? Our plans will not change. We are expanding our work force in the next 18 months and will continue our efforts to support our dealers and end customers alike, with even greater energy and commitment.

Are you experiencing any new technology demands from customers and how are you responding to them? Kaeser is always looking at ways to develop, where possible, our prod-uct range in response to market requirements. We are in an enviable position to be able to cover almost every application with an energy effi cient and reliable solution and where necessary, effect changes if it is deemed nec-essary. Such changes are engineered within our own research and development centre in Germany, where we can simulate any kind of operat-ing condition, to ensure the most reliable results.

Kaeser looks to provide energy effi cient and reliable solutions.

CARL BRIDENKAESER KOMPRESSOREN

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TOP 10

20 Utilities Middle East ● August 2009 www.arabianbusiness.com

The GCC’s top 10 power and water projects Regional power and water projects

are worth billions, here’s the proof

T he six GCC nations are spending bil-lions of dollars on the capacity expan-sion of their power and water networks.

Population growth, industrial diversifi cation and

expansion have all added to the demand placed on supply. Growth in demand is being dealt with head on, resulting in some massive new projects as well as substantial extension works.

Here, UME takes a look at the ten most valuable power and water projects from around the GCC. Selection is based on estimated or actual value of the works. All projects are currently active jobs,

GCC POWER AND WATER PROJECTS

TOP 10

Regional power and water projects are worth billions, here’s the proof

The six GCC nations are spending billions of dollars on the capacity expansion of their power and water networks. Population growth, industrial diversifi cation and expansion have all added to the demand placed on supply. Growth in demand is being dealt with head on, resulting in some massive new projects, as well as substantial extension works.

Here, UME takes a look at the ten of the most valuable power and water projects from around the GCC. Selection is based on estimated or actual value of the works. All projects are currently active jobs, ranging from the early tender

stage through to the closing stages of construction and commissioning.

20 Utilities Middle East ● August 2009 www.arabianbusiness.com

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TOP 10

www.arabianbusiness.com August 2009 ● Utilities Middle East 21

desalination plant, together with all sup-port facilities such as seawater intake and discharge structures and gas connection. Once operational it will have a capacity of 1234 MW of power and 218 200 m3

per day. Mott Macdonald is the technical advisor and BNP Paribas SA is the fi nan-cial advisor. Hyundai Heavy Industries was awarded the EPC contract. General Electric (GE) will supply the power plant turbines and Degremont will supply and install the desalination facility. MAIN CONTRACTOR: Hyundai Heavy Industries (EPC Contractor)MAIN CONTRACTOR: General Electric (Power Plant Turbines )MAIN CONTRACTOR: Degremont & Marubeni Corporation (RO desalination facility)MAIN CONSULTANT: Mott Mac-donald (Technical Advisor)Al Durr contracts were eagerly awaited.

BAHRAIN: Al Dur IWPPThe Al Dur power and desalination plant in Bahrain is being developed on a build, own, operate basis by a consortium com-posed of GDF SUEZ and Gulf Investment. The project has seen lucrative contracts awarded to large international players and will be located at Al Dur. The plant will consist of a combined cycle gas tur-bine power plant and a reverse osmosis

Contracts are still to be awarded.

KUWAIT: Al-Zour Desalination PlantThe project for the construction of the Al-Zour Desalination Plant in Kuwait is split into two phases. Both phases will consist of 1500 MW of power capacity, with a combined water capacity of 125 million gallons per day. Parsons Brinckerhoff International has been appointed as the main consultant and the tender for the main construction contract of phase two has already been issued. The deadline for bid submission is 8 September 2009. An award for the main construction contract is expected to be announced in fi rst quarter of 2010.MAIN CONTRACTOR: Parsons Brinckerhoff International Incorporated

The project for the construction of the Al-Zour Desalination Plant in Kuwait is split into two phases. Both phases will con-sist of 1500 MW of power capacity, with a combined water capacity of 125 mil-lion gallons per day. Parsons Brinckerhoff International has been appointed as the main consultant and the tender for the main construction contract of phase two has already been issued. The deadline for bid submission is 8 September 2009. An award for the main construction contract is expected to be announced in fi rst quar-ter of 2010.MAIN CONTRACTOR: Parsons Brinckerhoff International Incorporated Industrial infrastructure is essential for Al-Shuaiba, which is also has an advanced pier system for the local refi nery industry.

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KUWAIT: Shuaiba North Power and Desalination Plant

Al Duqm could be coal-fi red.

OMAN: Al Duqm IWPPThe Al Duqm IWPP is currently on the books as the fi rst coal-fi red power plant in the GCC. If it goes ahead the proposed plant is expected to have an electricity capacity of 1 000 MW. Legal, fi nancial and technical advisory ten-ders have all been issued. A Request for Proposal for the main construction con-tract is expected in the second quar-ter of 2010. Evaluation of the proposals and the subse-quent award of contracts are expected in the fi nal quarter of 2010. The plant is not expected to start commercial opera-tion until 2015 at the ear-liest. The rising price of gas, as well as supply and demand issues drove the decision to look at coal as Oman looks to diversify its elec-tricity generation fuel sources.

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TOP 10

22 Utilities Middle East ● August 2009 www.arabianbusiness.com

Gerard Mestrallet, CEO of GDF Suez, which has a 20% stake in Ras Girtas.

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The Mesaieed Independent Power Plant (IPP) project combines a 2 000 MW power plant with a large substation. The plant output will serve the national grid and the planned Mesaieed aluminum smelter. Iberdrola Ingenieria Y Construction won the EPC contract in November 2006. Fichtner Consulting Engineers is the technical advisor. GE was awarded the contract of installation six Frame 9FA gas turbines, two Frame 6B gas turbines, six 330H type generators, and three D11 steam tur-bines. The project is expected to be completed in the second quarter of 2010 and Qatar Petroleum will supply gas for the plant.MAIN CONTRACTOR: GE (Turbines Supplier)MAIN CONTRACTOR: Iberdrola Ingenieria Y ConstructionMAIN CONSULTANT: Fichtner Consulting Engineers (Technical Advisor)Mesaieed’s industrial strength will rise with power plants and an aluminium smelter planned.

The Dubai Electricity and Water Authority’s Hasssyan power and desalination complex is planned to be a huge plant made up of six stations (P1, P2, Q1, Q2, R1, R2) each with a gross capacity of around 1 500 MW and between 100 - 120 million gallons per day of desalinated water. Confi gurations on the drawing board include gas turbines with associated heat recovery steam generators, auxiliary boilers, backpressure steam tur-bines and MSF desalination units. The project will also include infrastructure for water

The many phases of the proposed Hassayan power and water project are intended to supplement Dubai’s ‘G’ station.

storage and distribution. Mott Macdonald is the consultant for P1, while Lahmeyer is the consultant for P2. DEWA initially planned to build two water and power plants at the site simultaneously. In February 2009, DEWA delayed the tender for the P2 stage to September 2009. P1 was put on hold due to the high prices of bids submitted. MAIN CONTRACTOR: Mott Macdonald (P1 Stage)MAIN CONTRACTOR: Lahmeyer Intl (P2 Stage)

The Ras Girtas power and water plant in Qatar’s Ras Laffan is expected to have a capacity of 2 730 MW, combined with a potable water output of 63 million gallons per day. The EPC

contract went to Mitsui Corporation of Japan, which in turn sub-contracted Hyundai, Mitsubishi Heavy Industry and France’s Sidem. Completion of the project’s fi rst phase is scheduled for 2010, with full project completion expected in April 2011. Ras Girtas Com-pany for Power is a joint venture between Qatar Petroleum (15%), Qatar Electricity and

Water Company (45%), GDF Suez of France (20%), Mitsui Corporation (10%), Chubu Cor-poration of Japan (5%) and Shikoku Corporation of Japan (5%).

MAIN CONTRACTOR: Mitsui Corporation of Japan

QATAR: Ras Girtas Power & Water Plant

QATAR: Mesaieed Independent Power Plant (IPP)

UAE: Hassayan power and desalination plant

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TOP 10

www.arabianbusiness.com August 2009 ● Utilities Middle East 23

The independent water and power plant in Jubail Industrial City will be made up of four blocks and based on combined cycle generation gas turbines. The extraction steam will supply the desalination plant, which will have 27 units employing multiple effect dis-tillation technology. When operational, the plant will produce 2 745 MW of power and 800 000 m3 per day of desalinated water. These resources are destined for Jubail Indus-trial City and the Eastern Province of Saudi Arabia. The project is being developed with on a build, own, operate and transfer basis. The Seuz consortium was awarded the con-struction contract in December 2006. The consortium is a joint venture between Suez Energy International and Saudi Arabia’s Acwa Power Projects.MAIN CONTRACTOR: Suez Energy International MAIN CONTRACTOR: Acwa Power Projects, Saudi Arabia

Jubail’s oil-centred industrial base is hungry for more power.

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Located 100 km south of Jeddah, this project involves the construction of a 1200 MW plant adjacent to the existing Shuaiba facility. Alstom won the main construction contract for the expansion package in July 2008. Construction is in progress and expected to be completed in early 2013. When fi nally complete the Shuaiba power station will be made up of 14 units, each of 400 MW, adding up to a gross total output of 5600 MW. As leader of the construction consortium, Alstom is designing, supplying, installing and com-missioning the entire plant. Key com-ponents include oil-fi red boilers, STF40 steam turbines, GIGATOP turbogenera-tors, sea-water fl ue gas desulphuriza-tion and auxiliary equipment. The boil-ers are designed to burn both crude and heavy fuel oil. Alstom’s consortium part-ner, Saudi Archirodon, will carry out all the associated civil and marine works. MAIN CONTRACTOR: Alstom The steadily expanding Shuaiba facility is located 100km south of Jeddah.

CPI Power Engineering was awarded the main construction contract in November 2008. Construction of the 2 400 MW captive power plant started early this year and is expected to be completed in 2013. It is intended to power an aluminium smelter in Jizan Economic City. The city itself is 725 km south of Jeddah and will include res-idential, commercial and industrial zones. The economic city will be built in phases and is expected to be completed by the end of 2020. The Aluminum Corporation of China (Chalco) signed an agreement with Malaysia’s MMC Corporation and the local Saudi Binladen Group to develop a 1 million ton per year aluminum smelter in November 2007. MAIN CONTRACTOR: CPI Power Engineering

JEC is on the drawing board with a power-hungry aluminium smelter at its heart.

SAUDI ARABIA: Shuaiba power plant, stage 3

SAUDI ARABIA: Jubail IWPPSAUDI ARABIA: Jizan Economic City (JEC) - Power Plant

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24 Utilities Middle East ● August 2009 www.arabianbusiness.com

WATER CONSERVATION

Water’s power

The close connection between water and power means technology choices need to be made carefully

W ater and energy are shackled together in the Middle East. Desal-

inated water from combined power generation and desalination facili-ties is the primary source of supply in GCC countries. Water is also a cru-cial component in energy produc-tion. These facts make successful water treatment and reuse an essen-tial conservation measure.

While sensible use of water in the region sounds like an easy step toward effective water conserva-tion, the taking of it has proved elu-sive. Population growth, a broaden-ing industrial base and urbanisation have all had an impact on consump-tion and waste. This has left a number of Gulf countries almost totally reliant on sea water desalination for fresh water supplies.

Issues of scarcity have primar-ily been addressed through an

WATER CONSERVATION

24 Utilities Middle East ● August 2009 www.arabianbusiness.com

Solar thermal power frequently

needs a desert location, as well

as plenty of water.

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WATER CONSERVATION

increase in supply. Demand man-agement, sectoral allocation and punitive pricing techniques could all help encourage more cautious consumption. These same market manipulation techniques could also accelerate the adoption of water treatment technologies.

Market prospects for water treat-ment technologies remain strong, thanks to governments in GCC coun-tries exhibiting strong political will to continue investment in important infrastructure projects. Environmen-tal and health hazards related to the disposal of untreated effl uent, marine pollution, and deteriorating ground water quality are some of the issues that need to be dealt with. Though these infl uences have been overshad-owed by short-term economic con-cerns, analysts expect them to pos-itively infl uence market dynamics from 2009 to 2013.

Individual actions make an incre-mental difference, but the most potential for change lies with the industrial sector. Here, the right technology selection now could have a massive impact on the future.

CARBON VERSUS WATERCarbon has been top of the green agenda for years and the need to reduce emissions has dominated public debate, especially around clean energy production. But the sin-gular focus on carbon has distracted from energy’s growing impact on dwindling water sources, according to a report from Lux Research.

The report, Global Energy: Unshackling Carbon from Water, observes that while new energy sources and extraction methods may reduce carbon intensity – kilo-grams of CO2 emitted per kilowatt-hour (kWh) of useful energy – they

often impose increased water usage. It begs the question: have we become too focused on CO2 at the expense of water conservation?

“In short, yes, although water is stating to get on the radar,” said Michael LoCascio, a senior analyst at Lux Research. “A case in point is biofuels and solar thermal, which are popular because they are touted as potential solutions to carbon induced climate change. However, biofuels consume orders of magni-tude more water per unit of energy produced than conventional hydro-carbons and puts great stress tight water supplies in most of the agricul-tural regions around the world. It’s just plain bad policy.

“Solar thermal, like coal, natural gas, or nuclear, generates electricity by boiler water and as such requires condensers. However, unlike con-ventional systems that may be

located next to ample water supplies, solar thermal needs to be located in deserts, and because they are less effi cient than natural gas it requires even more water. Fortunately the dry condenser technology is avail-able, but at 10% to 15% relative effi -ciency penalty.

“Without a clear perspective on the trade-offs between carbon, water and other factors, executives risk making short-sighted business decisions, particularly if they are expanding into global economies like India or China where water is a comparatively rare resource.”

According to Lux’s report the energy horizon will continue to be dominated by coal and natural gas electricity sources in the near term. But the industry can expect to see more retrofi ts and upgrades of exist-ing facilities, to make them more water and/or energy effi cient. The

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WATER CONSERVATION

report also anticipates that alterna-tive energy sources will grow rapidly, but remain limited overall. The slow roll-out of transcontinental high-voltage DC transmission lines is expected to hinder low-carbon, low-water energy sources like solar and wind. Even advanced nuclear elec-tricity, which may well be the most technologically secure answer, has water as its Achilles’ heel.

“The original thesis of the report presumed that there was a funda-mental tradeoff between CO2 foot-print and water footprint, how-ever after conducting the analysis that is not the case,” said LoCascio. “There is also no fi rm fi xed relation-ship between price and water inten-sity between technologies or within groups. Rather each technology has its own and somewhat independent relationship with cost, CO2 footprint and water footprint.

“It’s basically a case-by-case basis, some technologies are awful on both a carbon and water footprint from but are cheap (coal), while others may be marginally better on carbon, but beyond awful for water and very expensive (biofuels). Renewables like wind and photovoltaic are good on water and carbon but are expen-sive and terribly unreliable.”

Technology-based solutions are available, or being developed. These include boiler water treatments, such as electrocoagulation, advanced ion exchange and membrane electroly-sis. LoCascio points out that the best way to reduce water consumption for electricity generation is to increase effi ciency, by using combined cycles or gasifying coal fi rst.

“Also, effi ciency leaps are possi-ble by increasing combustion tem-peratures allowed by new materi-als, coatings, and turbine cooling systems (the latter for natural gas), turbine and inlet cooling technolo-gies and others,” he said.

“There is also ample room for increasing the effi ciency of nuclear plants by going to higher temperature designs such as fl u-idised bed reactors, or molten salt reactors.”

THE WATER OPPORTUNITY The water treatment opportunity in the region is huge. It has grown rap-idly in recent years, which is both an indicator of its importance and the ready availability of the right technol-ogy. It is this technology that is open-ing the door to industrial-scale water conservation and reuse. The supply and maintenance of this technology

represents a signifi cant opportunity for businesses in the sector.

According to research from con-sultancy Frost & Sullivan, the GCC market for water and wastewater treatment equipment earned rev-enues of US $1.26 billion in 2008. Wastewater applications generated revenues of US $952 million, cor-nering 75% of the market. Frost & Sullivan estimate that around 60% of the market is from the munici-pal sector, which includes the real

estate or commercial market as well. While the economic slow-down of recent months will have an impact on this growth, it is not expected to greatly curtail activity, as the market and reaches US $1.87 billion in value by 2013.

“The way the water and wastewater sector will shape up over the coming years depends upon many factors, of which the economic slowdown is just one,” said Vivek Gautam, an ana-lyst with Frost & Sullivan. “Concerns about climate change and health hazards associated with disposal of untreated sewage are forces that can’t be neglected. All of these are expected to push wastewater recy-cling and reuse in the region.”

Gautam predicts that companies that invest in technology innova-tion and introduce cost effective products will have the advantage in market place.

“In recent times market growth has been fuelled by investments across various sectors of the econ-omy,” he said. “In the current sce-nario all market participants are facing an environment of subdued market demand. Decline in invest-ments has adversely affected the demand for water and wastewater treatment equipment. The market today is a buyer’s market.”

Gautam sees consumables, such as scale inhibitors and membrane antis-calants as important in a water treat-ment company’s portfolio, if they are to prosper during this period. For medium to large companies the key lies in increasing their recur-ring revenues by aggressively tar-geting operations and maintenance services or annual maintenance con-tracts. However, there are still notes of caution to be observed.

“The market is fraught with chal-lenges in spite of its immense oppor-tunities,” says Gautam. “The com-plex business environment, slow decision making process, and cus-tomer preference for low cost solu-tions, regardless of performance, makes it diffi cult to penetrate the market.”

Water treatment technology presents a number of opportunities for regional businesses.

“Concerns about climate change and health hazards associated with disposal

of untreated sewage are forces that can’t be neglected.”

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COUNTRY PROFILE

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Iraq needs time, investment and the help of neighbours if its water and electricity needs are to be met

A t the end of 2008, Iraq’s daily power genera-tion averaged around

6 000 megawatts (MW), whereas demand was typically more than 10 000 MW per day.

As a result, Iraqi residents still suffer regular power outages. In July, iraqtomorrow.net reported that most areas of the country still receive power for just 1-4 hours per day.

In the absence of availability from the grid, individuals running their

Help wanted

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own oil-powered generators have fi lled the gap, selling power to house-holds at a large profi t.

In an effort to bridge the gulf between demand and supply, the Iraqi Ministry of Electricity has signed US $3 billion worth of deals with GE Energy to buy power gener-ation equipment and services.

Under the agreement, concluded late last year, GE Energy is supply-ing heavy-duty frame 9E multi-fuel gas turbines capable of generating a

combined total of 7 000 MW of elec-tricity. The government of Iraq plans to install the units at key sites around the country to provide needed sup-port for the electricity grid.

“Electricity is the backbone for quality of life and economic growth,” says John Krenicki, GE vice chair-man and president and CEO of GE Energy.

“We can bring the strength and dependability of GE’s advanced power generating technology and

services to Iraq’s mission to address long-term electricity demand.”

Work to revive Iraq’s power sta-tions, damaged through years of neglect and confl ict, continues.

In July this year, UNDP Iraq reported completion of repair work on units 1, 4 and 6 at Taji Gas Power Station in Baghdad Gover-norate. The work has added around 50 MW of electricity to the country’s national grid. At Mosul Gas Power Station, around 400 km north of

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COUNTRY PROFILE

30 Utilities Middle East ● August 2009 www.arabianbusiness.com

Baghdad, the repair of units 2 and 4 has added 30 MW of new electricity to the national grid.

In both projects, the UNDP supervised and monitored work from Amman on a daily basis using webcam and video conferenc-ing technology. A number of site engineers were also sent to Japan for product training, helping to boost the skills base in the country. According to UNDP, Iraqi engineers are now able to operate and maintain the plants to international standards.

Another project due for imminent completion is the rehabilitation of unit 1 of Musayab Thermal Power Station (TPS). The aim of the US $33 million project is to add another 100 MW per day to the national grid.

UNDP has also recently announced success in its efforts to return the Karama Water Treat-ment Plant’s production capacity to 10 million gallons (MGD) per day. This effectively means restoring safe potable water supply to approx-imately one million people on the Karkh side of Baghdad, specifi cally those in Kadhimiya and a few dis-tricts in Rasafa.

According to UNDP, water from the plant has improved by 75% and 300% in terms of the level of solid

content and chlorine content. Work was carried out on the water pump-ing station, chlorination facility, storage tanks, sand fi ltration plant, treated water pumping station, elec-trical power supply system and sev-eral overhead cranes.

As part of UNDP’s remit to trans-fer knowledge, staff from the water treatment plant, Baghdad Water Authority and the Mayoralty of Baghdad received the equivalent of 120 days of comprehensive training on operations and maintenance.

Whatever improvements Iraq makes to its water collection, stor-age and distribution systems, supply of raw water is a growing problem.

Iraq’s Ministry of Water Resources estimates that it needs around 50 billion cubic metres (m3) of water annually, of which 60% comes from the Tigris river and the rest from the Euphrates. Its problem is that Turkey, which sits upstream from Iraq, continues to siphon off ever greater amounts of Euphrates and Tigris water.

The Turkish GAP, an ambitious US $32 billion program to build 22 dams and 19 hydroelectric power plants on the two rivers, will only increase the amount of water that disappears from the rivers before

they reach Iraq. In one scenario, Iraq’s annual water requirement will increase to 77 billion m3 by 2015, whereas availability of Tigris and Euphrates water will have declined to 43 billion m3 annually.

Iraq has called for formal talks with Turkey to resolve the problem of how Tigris and Euphrates water is shared.

In Iraq’s far South, Iran has been blamed for the disappearance of the country’s marshes and deg-radation of agricultural land by diverting rivers that fl ow into the Shatt Al-Arab.

Notwithstanding the water policies of its neighbours, there are many practical steps that Iraq can take to address the problem of water short-ages. Its irrigation infrastructure is seen as antiquated and wasteful; little of its water is recycled and the dump-ing of material and liquid waste in its rivers persists. Its water capture and distribution systems need urgent modernisation and more dredging is required to prevent the building up of silt in water channels.

Restoring Iraq’s electricity and water supply to levels approach-ing peak demand will require time, investment and smart negotiation.

IN NUMBERS: IRAQ

GDP (purchasing power parity):$112.8 billion (2008 est.)$104.6 billion (2007)$103.1 billion (2006)

GDP (offi cial exchange rate):$93.8 billion (2008 est.)

GDP - real growth rate:9.8% (2008 est.)1.5% (2007 est.)6.2% (2006 est.)

GDP - per capita (PPP):$4,000 (2008 est.)$3,800 (2007 est.)$3,800 (2006 est.)

Budget:revenues: $42.4 billionexpenditures: $49.9 billion (FY08 est.)

Industries:petroleum, chemicals, textiles, leather, construction materials, food processing, fertilizer, metal fabrication/processing

Industrial production growth rate:10.5% (2008 est.)

Electricity - production:36.92 billion kWh (2008 est.)Electricity - consumption: 39.88 billion kWh (2008 est.)

Electricity - imports:2.95 billion kWh (2008 est.)Natural gas - production:15.66 billion m3 (2008 est.)

Natural gas - consumption:9.454 billion m3note: 1.48 billion m3 were fl ared (2008 est.)

Natural gas - proved reserves:3.17 trillion m3 (1 January 2008 est.)

COUNTRY PROFILE

30 Utilities Middle East ● August 2009 www.arabianbusiness.com

The Euphrates runs the length of the nation is one of two main water life lines in Iraq.

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PROJECTS

32 Utilities Middle East ● August 2009 www.arabianbusiness.com

UTILITIES PROJECT TRACKERInformation is supplied by Ventures Middle East. Tel: +971 2 622 2455. URL: www.ventures-uk.comMIDDLE EAST

Project Title Client Consultant Main ContractorValue / Value Range (US$. Mn) Project Status Project Type

SAUDI ARABIA

Reinforcement of Six 132-kV Substations in Jizan

Saudi Electricity Company (SEC) In House Iscosa Industries & Mainte-nance, LTD.

65 project under construction

Others

Shouaiba-2 Substation - Namera North Overhead Transmission Line

Saudi Electricity Company (SEC) Not Appointed 106 EPC Bid Power Transmission

Tabuk Power Plant Saudi Electricity Company National Engineer-ing Services Pakistan (Nespak)

National Contracting Company

114 project under construction

Power Plant

Desalination Plant in Jeddah - Phase 3

Saline Water Conversion Corporation (SWCC)

Kuljian Engineering Corporation

Doosan Heavy Industries & Const. Company / Saudi Berkefeld Filter (Witco)

245 project under construction

Desalination Plant

Shouaiba IWPP - Phase 3 Saline Water Conversion Corporation (SWCC)

Fichtner Siemens/Doosan 2,500 project under construction

Power & Desal Plant

Khurais Field Development-Qurayyah Seawater Treatment Plant

Saudi Aramco Jacobs Eng./SNC Lavalin/Saud-Consult

Snamprogetti 2,000 project under construction

Water Treatment

10J Substation & 101 Satellite Substation in Yanbu

Royal Commission for Jubail and Yanbu (RCJY)

Not Appointed 150 EPC Bid Substation

33/13.8-kV 7921-Substation in Hail Saudi Electricity Company (SEC) Mohammed Al-Ojaimi Contracting Est.

5 project under construction

Substation

Yanbu IWPP The Power & Water Utilities Company for Jubail & Yanbu (Marafi q)

Mohammed A.Turki Mott MacDonald

Not Appointed 4000 EPC Bid Power and Desalina-tion Plant

Rabigh IWSPP Petro-Rabigh Mitsubishi Heavy Industries 500 project under construction

Power & Desal Plant

110/13.8-kV Substation in Al Misfalah - 3

Saudi Electricity Company (SEC) Saudi Electricity Company (SEC)

Saudi Services for Electro Mechanic Works Co. (SSEM)

5 project under construction

Substation

380-kV Substation at Jubail 2 Saudi Electricity Company (SEC) Cogelex Alstom S.A (Areva T&D)

148 project under con-struction

Substation

Inter - Jubail Overhead Line Saudi Electricity Company (SEC) Saudi Services for Electro Mechanic Works Co. (SSEM)

100 project under con-struction

Power Transmission

Power and Water Plant in Ras Al Zour

Saudi Arabian Mining Company (Maaden) / Rio Tinto Alcan

Not Appointed 2500 project under design Power & Desal Plant

Yanbu-2 Power Plant Saudi Electricity Company Not Appointed 1,500 project in its concept stage

Power Plant

Shouaiba Power Plant Expansion - Phase 2, Stage 2

Saudi Electricity Company Not Appointed Not Appointed 900 project under study Power Plant

Ras Al-Zour IWPP Saline Water Conversion Corpo-ration (SWCC)

Fichtner Not Appointed 3,000 EPC Bid Power & Desal Plant

Tabouk Power Plant Expansion Ministry of Water and Electricity National Contracting Company Limited (NCC)

90 project under construction

Power Plant

Captive Power Plant in JEC Saudi Binladin Group / CHALCO / MMC Corporation Berhad

CPI Power Engineer 2000 project under construction

Power Plant

480 MW Expansion of Jeddah PP3 - Stage II

Saudi Electricity Company (SEC) Not Appointed 250 project under study Power Plant

PP11 Power Plant in Riyadh Saudi Electricity Company (SEC) Not Appointed 2133 EPC Bid Power Plant

Rabigh IPP - Jeddah North Subsa-tion OHTL

Saudi Electricity Company Middle East Engineering and Development Company Ltd (MEEDCO)

62 project under construction

Power Transmission

1200 MW Thermo-electric Power Plant in Rabigh

Saudi Electricity Company (SEC) Not Appointed Not Appointed 2000 project in its concept stage

Power Plant

UAE

Desalination Plant in Jafza Jafza/Palm Water GHD Not Appointed 250 EPC Bid Desalination Plant

Hassyan Complex - Station P - Phase 2(P2)

Dubai Electricity and Water Authority (DEWA)

Lahmeyer Interna-tional, Abu Dhabi

Not Appointed 3000 EPC Bid Power and Desalina-tion Plant

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PROJECTS

www.arabianbusiness.com August 2009 ● Utilities Middle East 33

Project Title Client Consultant Main ContractorValue / Value Range (US$. Mn) Project Status Project Type

Fujairah 2 (F2) IWPP ADWEA/ Marubeni Corporation/ International Power

Fichtner Alstom Power / Sidem 3,000 project under construction

Power & Desal Plant

14 New Substations - Dubai Invest-ment Park

Dubai Investments Park / DEWA Siemens, Dubai 200 project under construction

Substation

Six 33/11kV Substations in Al Ain Abu Dhabi Water and Electricity Authority (ADWEA)

Mott MacDonald, Abu Dhabi

Larsen & Toubro, Abu Dhabi 94 project under construction

Substation

Coal-Fired Power Plant in Abu Dhabi

Taqa (Abu Dhabi National Energy Company)

Not Appointed Not Appointed 1000 project under study Power Plant

Power and Desalination Complex-M Station

DEWA Fichtner Doosan / Fisia Italimplanti 2,693 project under construction

Power & Desal Plant

Nuclear Power Plant in Abu Dhabi Abu Dhabi Water and Electricity Authority / Emirates Nuclear Energy Corporation

Not Appointed 60000 EPC Bid Power and Desalina-tion Plant

Installation of 11kV Cables in Dubai Dubai Electricity and Water Authority (DEWA)

Not Appointed 25 EPC Bid Power Transmission

Five 132/11 kV & One 132/33 kV Substations in Dubai

Dubai Electricity and Water Authority (DEWA)

Emirates Trading Agency (ETA), Dubai

225 project under construction

Substation

KUWAIT

Al Zour Power Plant Expansion MEW Parsons Brinckerhoff

Not Appointed 3,700 project under design Power & Desal Plant

Sabriya ‘A’ Substation KOC Al Ahlia Switchgear Company

10 project under construction

Substation

Shuaiba Power & Desalination Plant

MEW Parsons Brinckerhoff

Mitsui Company 1,300 project under construction

Power & Desal Plant

Shuwaikh Desalination Plant MEW Doosan Heavy Industries & Construction Kuwait

320 project under construction

Desalination Plant

Five 132/11 kV Substations at Jaber Al-Ahmed

MEW Al Ahlia Switchgear Company

66 project under construction

Substation

QATAR

Ras Laffan C Independent Water & Power Project

Qatar General Electricity & Water Corporation

Kema Mitsui & Company 3,900 project under construction

Power & Desal Plant

Captive Power Plant at Mesaieed Qatalum Mott MacDonald GE / Doosan Heavy Industries

1,000 project under construction

Power Plant

Mesaieed A - Power Project in MIC QEWC/QP/Marubeni Fichtner Iberinco 2,000 project under construction

Power Plant

OMAN

Desalination Plant in the Duqm Area

Rural Areas Electricity Company VA Tech Wabag 21 project under construction

Desalination Plant

Salalah IWPP Oman Power & Water Procurement Company

Fichtner Not Appointed 400 EPC Bid Power & Desal Plant

Rusayl and Barka-Phase 2 Schemes Suez Tractebel / Mubadala Devel-opment Company / Oman Power and Water Procurement Co.

Black & Veatch Consulting

Doosan Heavy Industries 800 project under construction

Power & Desal Plant

BAHRAIN

IWPP in Addur Min. of Finance/ Min. of Elec-tricity & Water

Mott MacDonald Hyundai Heavy Industries / Degremont

4,000 project under construction

Power & Desal Plant

Ten 220kV Substations Ministry of Electricity & Water, Bahrain

Electricity Supply Board Int. - Ireland

Electricity Supply Board International- Ireland (ESBI)

105 project under construction

Substation

Page 36: Utilities Middle East

TENDERS

34 Utilities Middle East ● August 2009 www.arabianbusiness.com

UME provides free access to the latest publicly available tender listings from across GCC countries. The tenders included are aggregated from a wide variety of public and private sector sources from across the region. Where possible, tenders include the issuer, name and category of the tender; opening and closing dates; narratives; fees, bonds and contacts

2 X 20 MVA SUBSTATIONIssuer: Majan Electricity CompanyTender o: 213/2009Description: New 2 x 20 MVA substation at Khabourah Closes: 10 AugustFees: OMR285,000Closes: www.tenderboard.gov.om

WATER TREATMENT AND DESALINATION PACKAGEIssuer: East Delta Electricity Production CompanyDescription: Water treatment and desalination package pertaining to Sukhna 2 x 650MW steam fired power station project.Closes: 17 AugustFees: EGP8392Bond: EGP6.7 millionContact: Shebin El Kom Street, Ismailiya, Egypt

WATER INTAKE CHANNELIssuer: Dubai Electricity and Water AuthorityTender No: CNE/0114/2008(R)Description: The scope of work includes the construction of a water intake channel (onshore and offshore sections).Closes: 13 SeptemberFees: AED5000Contact: Dubai Electricity and Water Authority, PO Box 564, Dubai, UAE

Tender activityVisit constructionweekonline.com for the latest tender information

To add a tender to our listing, email details to lutfi [email protected]

TAIF - AL-BAHA WATER TRANSMISSION SYSTEMIssuer: Saline Water Conversion CorporationTender no: 2/2009Title: Taif - Al-Baha Water Transmission SystemDescription: The scope of work includes Taif - Al-Baha water transmission system in Saudi Arabia.Bond: N/ATender fee: 100000.00 SARCloses: Aug 17, 2009Contact: http://www.swcc.gov.sa

SUPPLY & INSTALLATION OF 33-KV INDOOR TYPE SWITCHGEAR IN OMANIssuer: Muscat Electricity Distribution Co. (SAOC)Tender no: 221/2009Title: Supply & Installation of 33-kV Indoor Type Switchgear in OmanDescription: The scope of work includes supply & installation of 33-kV indoor type switchgear at old airport primary substation in Ruwi.Bond: N/ATender fee: 200.00 SARCloses: Aug 10, 2009Contact: http://www.tenderboard.gov.om

SUPPLY OF PIPELINE FOR TAIF - AL-BAHA WATER TRANSMISSION SYSTEMIssuer: Saline Water Conversion CorporationTender no: 3/2009

Title: Supply of Pipeline for Taif - AL-Baha Water Transmission SystemDescription: The scope of work includes supply of pipeline for Taif - AL-Baha water transmission system.Bond: N/ATender fee: 100000.00 SARCloses: Aug 16, 2009Contact: http://www.swcc.gov.sa

REPLACEMENT OF SWITCHGEAR IN KUWAITIssuer: Central Tenders CommitteeTender no: 3082909Title: Replacement of Switchgear in KuwaitDescription: The scope of work includes replacement of 8 switchgears in Ahmad Al-Jaber Air Force, Kuwait.Bond: ApplicableTender fee: 50.00 KWDCloses: Aug 18, 2009Contact: Central Tenders Committee - Ministry of Defence

HASSYAN POWER & DESALINATION STATION (STATION P - PHASE 2) IN DUBAIIssuer: Dubai Electricity & Water AuthorityTender no: CNE/606/2007(R)Title: Hassyan Power & Desalination Station (Station P - Phase 2) in DubaiDescription: The scope of work includes construction of Hassyan Power & Desalination Station P - Phase

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TENDERS

www.arabianbusiness.com August 2009 ● Utilities Middle East 35

2 with capacity of 1500 MW and 100 - 120 Million Gallons per Day (MIGD) water at Hassyan, Dubai. The work is divided into two packages. Power Plant Package (P) and Desalination Package (D). The station is planned to be commissioned in stages during the years 2011 & 2012.Bond: N/ATender fee: 5000.00 AED Closes: Sep 8, 2009Contact: Head Office of Dubai Electricity & Water Authority

AL-ZOUR DESALINATION PLANT - PHASE 2Issuer: Ministry of Electricity and WaterTender no: MEW/39/2008/2009Title: Al-Zour Desalination Plant - Phase 2Description: The scope of work includes design, construction of Al-Zour desalination plant, phase 2.Bond: ApplicableTender fee: 3000.00 KWD Closes: Sep 8, 2009Contact: http://www.ctc.gov.kw

HASSYAN POWER & DESALINATION STATION - WATER INTAKE AND OUTFALL SYSTEM PACKAGEIssuer: Dubai Electricity & Water AuthorityTender no: CNE/0114/2008(R)Title: Hassyan Power & Desalination Station - Water Intake and Outfall System PackageDescription: The scope of work includes construction of water intake channel (onshore and offshore sections), outfall System comprising and outfall chamber means of transporting the discharge offshore, boat house anf boat lifting facilities, and ancillary works, including roads and lighting.Bond: N/ATender fee: 5000.00 AEDCloses: Sep 13, 2009Contact: The Chairman, Board of Directors Dubai Electricity & Water Authority

CONSTRUCTION OF OHTL IN SEVERAL AREAS OF KUWAITIssuer: Central Tender CommitteeTender no: MEW/34/2009/2010Title: Construction of OHTL in Several Areas of KuwaitDescription: The scope of work includes construction of 32, 132, and 300-kV Over-head transmission line.Bond: ApplicableTender fee: 2000.00 KWDCloses: Sep 15, 2009Contact: Central Tender Committee - Ministry of Electricity & Water

INSTALLATION OF 2 AIR COMPRESSORS IN KUWAITIssuer: Central Tenders CommitteeTender no: MEW/37/2009/2010Title: Installation of 2 Air Compressors in KuwaitDescription: The scope of work includes supply, installation, commission and testing of two air compressors used by Al-Zour Southern Plant in Kuwait.Bond: ApplicableTender fee: 100.00 KWDCloses: Sep 29, 2009Contact: Central Tenders Committee - Ministry of Electricity & Water.

REPLACEMENT OF WATER PIPELINE IN KUWAITIssuer: Central Tenders CommitteeTender no: MEW/41/2009/2010Title: Replacement of Water Pipeline in KuwaitDescription: The scope of work includes replacement of No.3 water pipeline that supply the turbines in Doha power plant.Bond: ApplicableTender fee: 80.00 KWDCloses: Sep 8, 2009Contact: Central Tenders Committee - Ministry of Electricity & Water

ABDULLAH PORT - AL FUNAITEES EAST POTABLE WATER PIPELINESIssuer: Central Tenders CommitteeTender no: MEW/37/2008/2009Title: Abdullah Port - Al Funaitees East Potable Water PipelinesDescription: The scope of work includes construction of five 1600MM-potable water pipelines from Abdullah Port to Al Funaitees East.Bond: ApplicableTender fee: 4000.00 KWDCloses: Sep 29, 2009Contact: www.ctc.gov.kw Ministry of Electricity and Water

SUBSTATION 10J AND SATELLITE SUBSTATION 101The Royal Commission for Jubail & Yanbu (RCJY) has a substation tender closing on 16 August. Tender number PIC B-1191A is for substation 10J and satellite substation 101. The scope of work includes all engineering, procurement and construction activities required to provide the 380/115/34.5 kV substation 10J, as well as the 380 kV transmission circuits on lattice steel tow-ers, all in Yanbu Industrial City. The contract also covers a 34.5/13.8 kV satellite substation. There’s a tender fee of 33,500 SAR. Contact: Contracts Section Directorate General of the Royal Commission in Jubail, Procurement Department PO Box 10001 Jubail Industrial City 31961, Phone: 009663-3414127/4163,

KEY CONTRACT

Page 38: Utilities Middle East

EVENTS

36 Utilities Middle East ● August 2009 www.arabianbusiness.com

August 17-19

Smart Grid Implementation Summit

Washington DC, USA

www.iqpc.com

October

Construction Week Iraq Briefi ng

Baghdad, Iraq

www.constructionweekonline.com

October 4-7

Middle East Nuclear Energy Summit

Dubai, UAE

www.iqpc.com

October 7-9

WaterSmart Innovations

Las Vegas, USA

watersmartinnovations.com

October 9

QWETEX

Doha, Qatar

www.eventseye.com

October 11-13

Ecobuild Emirates

Dubai, UAE

www.ecobuildemirates.com

October 11-13

Africa Arab Business Investment Forum

Dubai, UAE

www.africa-arab.com

October 18-21

Security for Energy Infrastructure

Summit Abu Dhabi, UAE

www.iqpc.com

November 4

Construction Week Awards

Dubai, UAE

www.constructionweekonline.com

November 11-12

Construction Week India Conference

New Delhi, India

www.constructionweekonline.com

November 23-26

The Big 5

Dubai, UAE

www.thebig5exhibition.com

December 9

MEP Awards

Dubai, UAE

www.constructionweekonline.com

EVENT HORIZON

November 3

The Construction Week Conference will give participants the opportunity to discuss the lessons they’ve learned from one of the toughest year’s the region’s industry has faced. People will be able to hear about the ingenuity demonstrated in the face of a year has been starkly different from anything seen before. The conference will look at how the best construction contractors rose to the challenges and took advantage of the opportunities in power and water infrastructure.

Construction Week ConferenceDubai, UAE

www.constructionweekonline.com

December 8

Downturns are when innovations can take off and there is a thirst for sustainable ideas, including those that provide energy. The Building Sustainability conference will be looking at the how’s and why’s of going green, while discussing practical examples of initiatives that have had a positive impact.

Building SustainabilityAbu Dhabi, UAE

www.constructionweekonline.com

October 28

With the rise of super projects, Kuwait MEP contractors need to offer value to their customers as well as being effi cient, sustainable and timely. This conference aims to shine the spot-light on Kuwait and discuss issues such as the challenges involved in engaging with Kuwait devel-opers, what projects and opportunities exist, what technologies are needed and the long-term plans for the country.

MEP ConferenceKuwait

www.constructionweekonline.com

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QUICK Q&A

40 Utilities Middle East ● August 2009 www.arabianbusiness.com

management solutions. Our prod-uct offerings go beyond tradi-tional energy management where designed to be implemented as part of utility-based variable tariff structures. This load shedding, demand response capability pro-vides signifi cant savings for the util-ity right down to the end user, with the added benefi ts of course to the environment, due to reduced con-sumption. Dubai can expect to see

variable tariff structures coming very soon with the initial roll out of smart meters already taking place.

What is signifi cant about Zigbee?Our products communications are based on Zigbee wireless. This allowed us to retrofi t the Environ-ment Protection Agency building

in two days. To wire such a build-ing would normally take two weeks. The existing market is enormous compared to the new, it’s how to make a difference for utilities, who want to affect existing companies, because that’s where the bulk of their demand is.

Can you describe an appli-cation has your wireless prod-uct/service been used for?Our solution has been deployed in hotels, university’s, commercial buildings, and retail stores. Our largest single installation is in the 5 000 room-plus Palazzo Hotel in Las Vegas. The system offers full integration and control of hotel reservations, room management, HVAC, lighting and access control.

What benefi ts did it offer your client and how are these realised?During our case studies we have found that clients who purchase our solution enjoy savings of 30-40% HVAC depending on site usage. We also further help our clients by reducing the capital cost of the system by entering into a revenue sharing agreement based on energy savings over fi ve years.

What do you see as the next develop-

What’s your company’s background?Varis Energy’s partners have a his-tory of involvement in substation automation. The idea came when we fi rst saw the change in mindset of utilities and how they were imple-menting the smart grid – taking the demand response situation from a commercial setting and move it into a residential setting – in order to facilitate load curtailment.

That’s where we came across Zigbee. It’s touted as a ‘last mile’ communications link between meters and smart devices in the home.

So, what do you do?Through our partners Rotary-Humm Dubai we offer highly fl ex-ible, easy to retro-fi t smart energy

“This load shedding, demand re-sponse capability provides signifi cant savings for the utility right down to

the end user, with the added benefi ts of course to the environment, due to

reduced consumption.”

ment step for your service or product?We will keep expanding our range of products to include control of standard consumer electronics devices. RF4CE group is going to see Zigbee as becoming the new standard for communications in consumer devices like TV’s, fridges, washing machines etc. It has already been shown in concept that a washing machine doesn’t start its wash cycle until the util-ity meter tells the machine that it is now the economy price tariff.

PEOPLE METERThe last mileVaris Energy managing director David Hogan talks to UME about how wireless metering can save cash and capacity

www.arabianbusiness.com

Page 43: Utilities Middle East

Celebrating 5 years of excellence

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Jamal Saghir, Director, Energy, Transport and Water, World BankMansour Al-Mayman, Director, Saudi General Investment Fund

Steve Bolze, President and CEO, Power & Water, GE EnergyAhmad A Al-Sa’adi, Vice President, Pipelines, Distribution and Terminals, Saudi Aramco

Mohamad Al-Debaib, General Manager, Saudi Industrial Development FundDr Mansour Durrani, Senior Coporate Banker, Structured Finance, National Commercial Bank

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For sponsorship opportunities please call Peter Braham on +44 20 7978 0087 or email [email protected] exhibit call Shunker Goel on +44 20 7978 0080 or email [email protected]

PRINCIPAL SPONSOR

Page 44: Utilities Middle East

GE Energy

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