utilities middle east

Middle East

An ITP Business Publication

ESSENTIAL INSIGHTS FOR MIDDLE EAST WATER, GAS AND ELECTRICITY PROFESSIONALS

An ITP Business Publication

RENEWABLES: GREEN ENTERPRISE IS STARTING TO STIR Despite lacking government support, business is looking for opportunities

May 2010 • Vol 4. Issue 5

SEEKING SAVINGSWhy pumps & valves need to be energy effi cient

FEEDING GROWTHHow feed-in tariffs

would promote clean energy in the GCC

O STIR port, business is looking for opportunities

SHAKEHow Public Private Partnerships are powering the Middle East

RENEWABLES: GREEN ENTERPDespite lacking government supp

PRISE IS STARTING TOport, business is looking fo

HHHHHHHHHHHHoooooooowwwwwwwwww PPPPPPPPPPPPPPuuuuuuuuuuuuuuuuuuuuubbbbbbbbbbbbbbbbbbbbbbllllllllllllllllllllllllliiiiiiiiiiiiiicccccccccc PPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPrrrrrrrrrrrriiiiiiiiiiiiiivvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaattttttttttttttttttttttttttttttttttttttttttttttttttttttttttteeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee PPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPPaaaaaaaaaaaaaaaaaaaaaaaaaaaaarrrrrrrttttttttnnnnnnnneeeeeeeerrrrrrrrsssssssshhhhhhhhhhhhhhhhhhhhhhiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiippppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppppssssssssssssssssssssssss aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaarrrrrrrrrrrrrrrrrrrrrrrrreeeeeeeeeeeeeeeeeeee pppppppppppppppppppoooooooooooowwwwwwwwwwwwwwwweeeeeeeeeeeeerrrrrrrrrriiiiiiiiiinnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnnggggggggggggggggggggggggggggggggggggggggggggggggggggggggggggggg tttttttttttttttttttttthhhhhhhhhhhhhhhhhheeeeeeeeeeeee MMMMMMMMMMMMMMMPOWER

OMICRON electronics GmbH | Oberes Ried 1 | 6833 Klaus | Austria | Tel.: +43 5523 507-0 | www.omicron.at | [email protected]

Pict

ure:

ww

w.o

mic

ron.

at/p

aint

ings

Primary Tests:

• Power Factor

• Sweep Frequency Response Analysis

• Exciting Current

• Transformer Turns Ratio (TTR)

• DC Winding Resistance

• Partial Discharge (PD)

• Moisture in Insulation

The primary testing solutions of OMICRON make Dad´s work at his electric co-op easier and more comfortable, no matter if he tests transformers, cables, rotating machines, switchgear, or other expensive assets.

OMICRON provides a comprehensive trans-former diagnostic solution. This saves Dad time, and enables him to easily understand the condition of his substation assets.

OMICRON offers you a New Choice in Transformer Diagnostics.

Trust in OMICRON, like Dad and customers in more than 130 countries already do.

and OMICRON is his New Standard in Transformer Diagnostics!

CONTENTS

www.utilities-me.com May 2010 ● Utilities Middle East 1

2 COMMENTUtilies are adapting to changing circumstances.

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

11 NEWS ANALYSISRenewables refuse to leave the Middle East agenda.

14 FEED-IN TARIFFSHow feed-in tariffs could provide the regulatory framework for cleaner energy across the region.

18 PERFECT UNIONPublic private partnerships have played their part in meeting the region’s ballooning power and water needs.

24 PUMPS AND VALVESThe industry is starting to recover from the downturn, but manufa-turers need to satify demands for energy efficiency.

27 TRANSFORMERSA look at whats going on in the Middle Eastern market for trans-formers.

32 PEOPLE METERKlaus Kallenberg, general manager at Toray Membrane Europe, looks at trends in desalination.

35 PROJECTSVentures Middle East provides an in-depth appraisal of the project landscape in the Utilities industry.

38 TENDERSBusiness opportunities in the Middle East.

40 SNAPSHOTA look at the power and transmission sector in Oman.

May 2010Issue 5

1418

Dr. Michael Krämer explains the benefi ts of feed-in-tariffs

32

Power play: its game on for PPPs.

Desalination focus with Toray Membrane

24Pumps and valves: a market looking for innovation

11Renewables: here to stay

COMMENT

2 Utilities Middle East ● May 2010 www.utilities-me.com

To subscribe please visit www.itp.com/subscriptions

T hings are afoot in the region’s power and water sector. New integrated water and power projects (IWPPs) are due to come

online soon to meet ever increasing demand, while proving the success of the public private partnership model in the Middle East.

Countries like Kuwait are gearing up for the adoption of smart grids, and alternative sources of energy are being explored and researched in Saudi Arabia, not previously known as a cham-pion of clean energy. Abu Dhabi, another national oil giant, is seeking to cooperate with the US Department of Energy to promote green ener-gies.

Niche markets, such as that for transformers and pumps and valves, are emerging from what many perceived as a fairly mild recession, and are faced with new challenges as customers are look-ing for their products to be as energy effi cient as possible.

Increasing demand for power and water is the result of the progressing urbanisation and indus-trialisation of the region, and not simply of unrea-

lised effi ciency gains and wasteful consumption patterns. And while environmental awareness in the Middle East surely leaves to be desired, addi tional energy needs stemming from new eco-nomic cities and industrial expansion are also encouraging, proving that the region is emerg-ing from its traditional role as a supplier of raw materials.

Whether through good intentions or not, gov-ernments are starting to give more consideration to renewable sources of energy, and are placing more importance on energy effi ciency.

“Utilities aren’t trying to conserve energy because they want to save the world, they have no choice,” comments a pump manufacturer.

Nothing sparks innovation like necessity. As they are scrambling to meet future energy demand, utilities in the most oil-rich countries in the world are starting to think green.

Florian Neuhof, Editor Email: fl [email protected]

Middle East innovationUtilities in the Middle East are starting to adapt

Middle East

Registered at Dubai Media CityPO Box 500024, Dubai, UAETel: 00 971 4 210 8000, Fax: 00 971 4 210 8080Web: www.itp.comOffices in Dubai & London

ITP Business Publishing LtdCEO Walid AkawiManaging Director Neil DaviesManaging Director Itp Business Karam AwardDeputy Managing Director Matthew SouthwellEditorial Director David InghamVP Sales Wayne LoweryPublishing Director Jason BowmanBusiness Development Manager, Saudi Arabia Rabih Naderi

Editorial

Group Editor Dan CantyTel: +971 4 210 8255 email: [email protected] Florian NeuhofTel: +971 4 210 8845 email: [email protected]

Advertising

Commercial Director Jude SlannTel: +971 4 210 8693 email: [email protected] Manager Raed KaedbeyTel: +971 4 210 8573 email: [email protected]

Studio

Group Art Editor Daniel PrescottDesigner Angela Ravi

Photography

Director of Photography Sevag DavidianChief Photographer Khatuna Khutsishvili Senior Photographers Efraim Evidor, Thanos Lazopoulos, Staff Photographers Jovana Obradovic, Rajesh Raghav, Ruel Pableo, Lyubov Galushko, Isidora Bojovic

Production & Distribution

Group Production Manager Kyle SmithDeputy Production Manager Matthew GrantProduction Coordinator DevaprakashManaging Picture Desk Patrick LittlejohnDistribution Manager Karima AshwellDistribution Executive Nada Al Alami

Circulation

Head of Circulation & Database Gaurav Gulati

Marketing

Head of Marketing Daniel Fewtrell

ITP Digital

Director Peter Conmy

ITP Group

Chairman Andrew NeilManaging Director Robert SerafinFinance Director Toby Jay Spencer-DaviesBoard of Directors K.M. Jamieson, Mike Bayman, Walid Akawi, Neil Davies, Rob Corder, Mary Serafin

Circulation Customer Service Tel: +971 4 210 8671

Certain images in this issue are available for purchase. Please contact [email protected] for further details or visit www.itpimages.com.Printed by Atlas Printing Press LLC,

Subscribe online at www.itp.com/subscriptions

The publishers regret that they cannot accept liability for error or omissions contained in this publication, however caused. The opinions and views contained in this publication are not necessarily those of the publishers. Readers are advised to seek specialist advice before acting on information contained in this publication which is provided for general use and may not be appropriate for the reader’s particular circumstances.

The ownership of trademarks is acknowledged. No part of this publication or any part of the contents thereof may be reproduced, stored in a retrieval system or transmitted in any form without the permission of the publishers in writing. An exemption is hereby granted for extracts used for the purpose of fair review.

Published by and © 2010 ITP Business Publishing, a member of the ITP Publishing Group Ltd. Registered in the B.V.I. under Company Registration number 1402846.

The sun is setting on old ways of thinking, as utility operators explore new options.

Copyright © 2009, Oracle. All rights reserved. Oracle is a registered trademark of Oracle Corporation and/or its affiliates.Other names may be trademarks of their respective owners.

oracle.com/goto/utilitiesor call 1.800.275.4775

The Most Complete Software Solution

SAP GE IBMOracle

Meter Data Management

Mobile Workforce Management

Network Management

Customer Care & Billing

Middleware

The SmartGrid Choice

REGIONAL UPDATE


New research centre for alternative energies in KSA

Kuwait seeks nuclear optionFrench companies are set to gain contracts to develop nuclear power plants

French President Sarkozy and Kuwaits Prime Minister Al-Sabah met in Paris to discuss the deal.

France and Kuwait signed an agreement to develop joint nuclear energy projects in the Gulf coun-try, giving French companies a foothold in the region only months after they lost out to Korean com-petitors in their bid to haul the UAE onto the nuclear stage.

The agreement “to develop the peaceful use of nuclear energy” was signed in Paris by Kuwait’s Prime Minister, Sheikh Nasser Mohammed al-Ahmad al-Sabah, and French government offi cials, reported the AFP newswire.

“This agreement will permit the development of cooperation between France and Kuwait in several areas of nuclear energy,” including electricity generation, a French government statement said.

The French President Nicolas Sarkozy hopes the new accord will “result in industrial cooperation,” according to the presidential web-site.

France hosted a gathering of 60 energy-hungry nations in Paris in

Saudi Arabia is to set up a scien-tifi c centre for civilian nuclear and renewable energy in Riyada, in an effort to fi nd new ways of meeting its rising demand for power and desalinated water.

King Abdullah ordered the cre-ation of the science complex, which will be headed by former trade min-ister Hashem Bin Abdullah Yamani, according to the state news agency SPA.

The centre will be in charge of promoting research and sealing

Kuwait buys smart metersKuwait’s Ministry of Electricity and Water ordered 170.000 auto-matic water meters from Elster, a German manufacturer.

The meters can be deployed in residences, government buildings and other facilities, and will help Kuwait monitor consumption and develop water management pro-grams.

As the meters are equipped with modern connectivity and inter-face systems, they can be linked up to future smart grid and advanced metering infrastructure projects.

Designed to withstand tempera-

future deals, and would also over-see activities related to the use of nuclear energy, said the news agency. It did not divulge any details regarding the timeframe of the project.

Demand for power grew last year by more than 8 percent in the Gulf state and is expected to grow to more than 60.000MW by 2020.

Saudi Arabia aims to boost installed power generation capac-ity to around 67.000 MW by 2020, up from the current 46.000 MW.

ture ranges from above 90 degrees Celsius to below freezing, as well as violent sand and dust storms, the water meters can be deployed inside and outside of house walls and in sidewalks.

“Elster specifi cally designed the water meters for Kuwait to with-stand a number of extreme envi-ronmental conditions, commented Jerry Lauzze, executive vice pres-ident of Elster’s global water busi-ness.

Elster’s local partner Al Khatla, will deliver the meters and accesso-ries to the Ministry.

March, with Sarkozy urging inter-national bodies to fi nance a new era of global nuclear power.

France has the world’s second largest nuclear sector and gener-ates around three quarters of its own electricity through nuclear

power, more than any other econ-omy. It has also made the export of nuclear technology an economic priority.

Engineering giants Areva and EDF are keen to market their European Pressurised Reactor, a

third-generation reactor design that the French fi rms consider the most advanced in the world.

France recently lost out on a US$20 billion contract to supply four reactors to the UAE as South Korean Kepco clinched the deal.

REGIONAL UPDATE


SEC: Losses widen as costs rise and the Kingdom embarks on an ambitious project to expand its power infrastructure.

SEC reports loss in Q1KSA utility suffers from higher costs and weak demand

The Saudi Electricity Company’s (SEC) Q1 loss widened on a year-on-year basis as the state-owned company faced higher costs from buying power and lower seasonal demand.

The net loss increased to US$208.5 million from US$205.5 million in the fi rst quarter of 2009,

the Riyadh- based company said in a statement on the Saudi bourse website.

Saudi Electricity’s loss wid-ened because of “an increase in energy bought from independent producers to meet an increasing demand,” the utility provider said. The company was also burdened

with additional costs it started new projects.

Saudi Arabia, wants to expand generating capacity as its popula-tion grows and industrial demand for energy rises. The Kingdom will spend US$80 billion to raise its capacity and expand its transmis-sion network in the next decade.

MASDAR AND DOE JOIN FORCESMasdar and the U.S. Depart-ment of Energy (DOE) signed a Memorandum of Under-standing (MoU) to promote collaboration on clean and sustainable energy technolo-gies.The agreement sets out to establish a framework for co-operation in three key areas – carbon capture and seques-tration, water and bio-fuels, and building technology. The agreement also opens the door for scientifi c and technical exchanges and the joint research and develop-ment of clean energy tech-nologies.

WATER SUSTAINABILITY CENTRE OPENS IN QATARA research and development centre promoting the sustain-able use of water has offi cial-ly opened in Doha, Qatar. The Global Water Sustainability Center (GWSC) is a joint proj-ect by ConocoPhillips and GE Power & Water.The center, located at the Qatar Science and Technol-ogy Park (QSTP), will primarily research and develop water solutions primarily for the petroleum and petrochemical sectors, but will also focus on municipalities and agricul-ture.

QATAR HOSTS POWER-GEN CONFERENCE The ninth Power-Gen Middle East conference and exhibition will be held in Doha, Qatar, be-tween 4-6 October. It is the fi rst time the annual conference on power generation, transmis-sion and distribution and the water industry in the region will be held in Qatar.

HIGHLIGHTS

Siemens to build substations in northern EmiratesSiemens has been awarded two contracts by the Abu Dhabi’s Fed-eral Electricity and Water Author-ity (Fewa) to built and modify sub-stations in the north of the UAE. The orders were awarded via the local Al Jaber Group, and have a com-

bined value of approximately US$22 million.

The two orders include the supply and installation of seven medium voltage turnkey substations, as well as the extension and modifi cation of 22 existing substations.

The power supply project is scheduled for completion within 12 months. The seven substations for the 33/11kV voltage levels will com-prise more than 350 medium voltage panels and around 150 panels for con-trol and protection.

REGIONAL UPDATE

6 Utilities Middle East ● May2010 www.arabianbusiness.com

KSA: More energy from crudeRapidly rising demand for power leaves Saudi Arabia little choice, says analyst

Saudi Arabia will increase its dependence on crude.

Qatar is expecting power consumption in Doha to increase.

Saudi Arabia’s total feedstock use will rise from 1.5 million barrel of oil equivalent (b9oe/d) last year to 2.5 million boe/d in 2020, Salah al-Awaji, the kingdom’s deputy electricity minister, told Reuters on the sidelines of an Asian power conference.

His estimate is based on spiral-ing domestic power demand. The Saudi Electricity Company (SEC) expects that increased demand will require an expansion of power gen-erating capacity from 46,000MW now to 67,000MW by 2020.

“The redirection of less effi -cient and more polluting crude to its power plants might work as an interim solution but will eat into its spare production capacity cush-ion when global demand starts rebounding seriously,” com-ments Global Insight Middle East analyst Ciszuk.

Qatar to spend over US$1bn on upgrading power network The Qatar General Electricity and Water Corporation has handed out contracts worth US$1.17bn as part of its bid to meet future demand for electricity in the Gulf state, the Qatar News Agency reported.

The contracts include the set-ting up of 18 new substations, the upgrade of 11 others, and the con-struction of a 400kV substation to

The scarcity of natural gas is the underlying reason for the over-reliance on crude, says Ciszuk. “A failure to fi nd signifi -cant new gas reserves and a need to utilise more gas as feedstock for the petrochemical industry, which is being expanded as part of the kingdom’s job-creating indus-trialisation programme, leaves it little option”

The Kingdom’s policy of sub-sidising power is aggrevating the problem.

“Power demand—fuelled by highly subsidised utility prices—continues to spiral, while more and more power plants have to be converted back to oil use after the country’s power generation feed-stock mix was almost virtually purged of crude a decade ago,” says Ciszuk.

Get

ty Im

ages

QGEWC has dished out almost $2 billion worth of upgrade contracts so far this year.Source: QGEWC

US$1.7 billion

support the GCC power intercon-nection project.

In addition, Phase Nine of the Qatar Electricity Transmission Network project will become real-ity with the construction of 220km of new cables and more than 85km new overhead lines.

Substation contracts have been awarded to Siemens Consortium

Germany, India, Qatar and Hyo-sung Corporation, Korea while the cables project deals have been won by Mitsubishi, Japan and Siemens Ltd, India.

The overhead line project was awarded to NCC, Saudi Arabia, while the telecom package was awarded to Areva, France.

The upgrade comes on the back of increasing pressures on the network. In 2009, Elec-tricity demand 14 percent from a 2008, while demand for water rose eight percent. The Gulf state faces a potential power shortage of around 300 to 350MW from late 2012.

Getty Images

REGIONAL UPDATE

www.arabianbusiness.com May2010 ● Utilities Middle East 7

A prototype of Mulk’s solar trough

Mulk takes solar leapSharjah company to profit from Indian feed–in tariffs Mulk Holdings, a Sharjah-based company that produces glass and aluminum facades, is to branch out into solar technology by supply-ing solar troughs to a joint venture in India.

Mulk Renewable Energy, a sub-sidiary, will hold a 25% equity stake Phase I of the plant, which is to be built in Banglore. Indian company Aditya Solar Power Industries will hold the majority stake. The plant will have an initial net power capac-ity of 40 MW once the fi rst stage has been completed in 2012, rising to 200 megawatts by 2013.

Mulk Renewable Energy is set to profi t through the joint venture by

OMAN THINKS SOLAROman is close to commission-ing a solar-powered desali-nation plant from an Indian Research Centre, according to the Indian Express website. The Omani Centre for Invest-ment Promotion and Export Development is in discussion with the Bhavnagar-based Central Salt and Marine Chemical Research Institute (CSMCRI) to set up a plant with a production capacity of 6.000 litres per hour, an investment of over US0 $850.000.The proposed plant in Oman will use solar photovoltaic panels for the treatment of water through patented CSMCRI membranes.

HIGHLIGHTS

receiving generous feed-in tariffs from the Indian government. A lack of similar government policies in the Middle Eastern countries means that renewable energy faces much greater hurdles in the region. “No businessman can go and invest in a solar plant and compete with coal, so the governments here need to offer more,” commented Mulk chairman Nawab Shaji Ul Mulk.

According to a company spokes-person, Mulk will be the fi rst com-pany in the UAE to produce solar panels. Their solar troughs are pro-duced in Sharjah using aluminum, rather than the customary glass mirrors, which the company says

provide extra durability and weight reductions.

The contracts for the delivery of the solar panels and the joint ven-ture were signed on April 7 by Ul Mulk and Aditya boss R. T. Muku-nda at Mulk’s headquarters in the Sharjah Hamriyah free zone.

Services - Erection and Commissioning - Repair and Refurbishment of Power Transformers - Oil Filtration and Testing : DGA, BDV, Degree of Polymerization, Moisture content. - Routine and Type Testing of Transformers in our facility. - Annual Maintenance Contracts. - Refurbishment of Tap changers. - Site and Commissioning Test. - Uprating of Transformers. - Spares.

Plot No 87-A4,Sector N-41, ICAD 1, Mussaffah, PO Box 111209, Abu Dhabi-UAE Tel - +971 2 5501910 www.btg.ae

your reliable partner since 1879 . . .

Standards IEC, ANSI, BS among others

Technology From Brush UK & Hawker Siddeley

Products Transformers upto 150 MVA 220 kV class

WEB HIGHLIGHTS


EDITORS PICK

Japanese teach UAE a sustainability lesson

A wastewater recycling plant designed to become a benchmark for the more sustainable use of water was inaugurated in the northern emirate of Ras Al Khaima.

ONLINE ANALYSIS

Most popular headlines1. Fujairah II to be online within Q2

2. Dolphin Energy: Pipeline on track despite delays

3. Saudi Electricity reports loss in Q1

4. Qatar to host Power-Gen conference

5. Research boost for solar in Qatar

ONLINE NEWS

New solar technology for Saudi desalination plant

SPOT POLL

What’s stopping your firm from engaging in Iran?

Fear of further sanctions

Visa restrictions for our key staff

Payment problems in the past

No desire to work in Iran

38%

29%

20%

12%

Research boost for solar in Qatar

Demand for transformers is still ‘slow and patchy’

An energy effi cient desalination plant to be built in Al Khafji City in Saudi Arabia will use new solar technology.

Demand for electricity transformers is still not back to pre-crisis levels, with the recovery slow and patchy across the Middle East.

Chevron and GreenGulf commit to joint reseearch on how to adapt solar to local conditions.

NEWS ANALYSIS


Renewables refuse to leave the agendaRenewables remain a hot topic. While many remain pessimistic about the lack of government enthusiasm, green enterprise is starting to stir in the region in spite of lacking regulatory supportIn the massive push to bring power infrastructure in line with growing demand, renewables are not much more than an afterthought to GCC governments.

There are exceptions. Saudi Arabia, which is investing heavily to build new power plants, is one of the few countries to consider the solar alternative, and to invest in research and technology.

The King Abdulaziz City for Sci-ence and Technology, Saudi Ara-bia’s national research group, aims to open the world’s largest solar-powered desalination plant by 2012 in the city of Al-Khafji.

The pilot plant will supply 30.000 cubic meters of clean water per day to 100.000 people, and reduce operating costs by using newly developed membrane technology, which will be powered by ultra-high concentrator photovoltaic technology, developed in conjunc-tion with IBM. In addition, the King Abdullah University of Science and Technology is due to build a solar plant for research and develop-ment purposes. The Masdar proj-ect in Abu Dhabi is another gov-ernment green initiative.

A promising start by the oil-rich countries, one might think, yet those projects seem to pale into insignifi cance compared to the tens of billions that both govern-ments are allocating to increase their electricity and freshwater generation capacities.

eral Arab countries, real political will is lacking, according to partic-ipants of a recent conference on the

subject. The environmental scep-tics, it seems, still have the upper hand. “They keep saying we need

And Saudi Arabia’s deputy energy minister Saleh Alawaji only last month admitted that the king-dom is looking to raise the amount of fossil fuels used for electricity generation to 2.5 million barrels of oil equivalent per day by 2020, up by 1 million barrels per day from current levels.

LACKING ENTHUSIASMWhile renewable energy initiatives and targets have been set in sev-

“It is the GGC states least affected by the global downturn that are doing the most

on the green front”

Green enterprise in the Middle East would profi t from more government support.

Get

ty Im

ages

NEWS ANALYSIS


more research,” May Jurdi, profes-sor of environmental health at the American university in Beirut, told the Reuters newswire at the conference. “Why do we need additional diag-nosis when the patient is dying?”

Given this context, it is little wonder that the solar industry the Middle East is nascent at best. And one of the last things one would expect is an UAE company man-ufacturing glass and metal exteri-ors branching out into solar.

Despite the political lethargy surrounding solar, or other green technologies, Sharjah-based Mulk Holdings have done precisely that. After researching and developing a range of solar panels over the last three years, the company now set to launch its new products.

According to a spokesman, it is the fi rst producer of solar panels

in the UAE. Yet tellingly, the com-pany’s fi rst order will not be deliv-ered into the region. Instead, it has signed an agreement to supply a plant in India with solar troughs. Mulk will take a 25% equity stake in the fi rst stage of the project, with a capacity of 40MW.

The company is set to profi t from India’s commitment to devel-oping renewable energy capaci-ties. According to Mulk, the new plant is set to receive a feed-in tariff of 15 rupees per MW, a price that is above that is above market levels.

FEEDING ON ECONOMIC RECOVERY?As last month’s lead article pointed out, feed-in tariffs are an absolute must if governments in the Middle East are to take serious steps to develop green energy solutions for the region. These tariffs are an

effective subsidy for renewable energies, and are vital to attract investment into power plants and research, as Michael Krämer from Taylor Wessing explains in his article in this month’s edition of the magazine.

Company chairman Nawab Shaji Al-Mulk could not agree more: “You need feed-in tariffs. It makes sense, because obviously solar is not competitive with coal, but coal is damaging. So the gov-ernment needs to say ‘Ok, we will pay you more so you come in with clean energy.’”

So is the future bright or bleak for renewables in the Middle East? Mulk is optimistic, and believes that the region would be further down the road of progress had it not been for the recession. “These things need a huge investment, we are talking about hundreds of

billions of dollars, so the govern-ments need to be in a position to do that.”

This is a good point. After all, it is the countries least affected by the global downturn that are doing the most on the green front.

Saudi Arabia and Abu Dhabi, whose enormous oil-wealth has allowed them to keep their infra-structure projects running even in the darkest days of the crisis, are the ones who are doing the most in pushing the green agenda. It is to be hoped that investment in alternative energies go hand-in-hand with economic recovery in the region.

In an irony that must border on the surreal to environmentalists, it might in fact be hydrocarbon derived wealth that will do most to advance alternative energy in the Middle East.

Feed-in tariffs would encourage small-scale production.

FEED-IN TARIFFS


Feeding growthAlready in use in over sixty countries, feed-in tariffs are a cornerstone of renewable energy policies worldwide. Taylor Wessing’s Dr. Michael Krämer explains the concept and the necessity of feed-in tariffs

T he Middle East is “going green”, at least if one was to believe what is being

reported in the media these days. There is no doubt that reduc-

ing carbon emissions is a great thing. And with the abundance of sun freely available, particularly in the Gulf region, not making use of solar energy and other natural resources is a waste indeed.

The main question is how the shift to supplying an entire country with green energy can be achieved

most effectively. A centralized approach whereby utility compa-nies gradually replace their con-ventional power plants with those that use renewable sources would most probably take decades, not least due to the sheer amount of investment required.

A quicker and altogether more convenient approach is to involve everyone, you and I, in the process, on a voluntary basis (of course). Such a decentralized approach has the benefi t of not placing the

signifi cant investment burden on only a few shoulders and prom-ises more energy being gener-ated from renewable sources in a shorter amount of time.

RENEWABLES – WHERE WE STAND TODAYAt present, the legal framework in the UAE does not really pro-vide the impetus for private invest-ments in the renewable energy fi eld. If, for example, I wanted to install solar panels on the roof of

my house I would not be entitled to connect such an installation to the public grid. That means I would be forced to install panels with a capacity that guarantees satisfy-ing 100% of my electricity needs at all times. This in turn means not only that the dimensions of my solar array would have to be huge (as would be the cost), but also that I would be facing rather hot summer nights without air condi-tion due to the usual lack of sun-shine during that time.

FEED-IN TARIFFS


In short, without being able to connect to the public grid there is absolutely no reason for me to make a signifi cant investment into renewable energy generation.

The second problem is that, at least to date, the generation of any form of renewable energy is more expensive than electricity pro-duced from fossil fuel. Instead of reducing my electricity bill, install-ing renewable energy sources merely adds to my cost and I have virtually no chance of ever recoup-ing my investment.

This means that only renewable energy enthusiasts will be will-ing to spend money on generating clean energy.

FEED-IN TARIFFS - A PROBLEM SOLVERThe above two issues can effec-tively be dealt with by introduc-

sumer who will pay the price. On the upside, however, we all bene-fi t from a more environmentally friendly future.

At present, feed-in tariff policies have been put in place in more than sixty countries around the globe, including Australia, Brazil, China, France, Germany, Singa-pore, South-Korea, South-Africa, as well as some states in the US.

GERMANY’S RENEWABLE ENERGY ACT: A BENCH-MARKThe German “Erneuerbare Ener-gien Gesetz” (Renewable Energy Act) has so far proven to be the most successful policy framework available, and is often used as a benchmark against which other feed-in tariff policies are being considered. (see box)

With such a legal framework in

THE ERNEUERBARE ENERGIEN GESETZ - THE KEY PRINCIPLES OF GERMANY’S BENCHMARK RENEW-ABLE ENERGY ACT

•Individuals are given the right to feed any electricity they generate from renewable sources into the public grid and to be paid for any amount of electricity they make so available to the public.

•In turn, grid operators are obliged to not only allow any such private source of renewable energy being connected to the public grid, but also to purchase any electricity so produced at pre-set rates.

•Prices are guaranteed for a period of twenty years, which provides producers of renewable energy with a reliable means of recouping their investment.

•The price payable to each individual producer of renew-able energy is based on the typical cost of generation from a particular source of energy. This results in different prices being paid for energy from different sources (e.g. solar energy yielding higher prices than electricity gener-ated by wind turbines).

•The price of a KWh of renewable energy depends on the time of installation of the energy source. Higher prices are being paid for energy produced from sources which have been installed earlier (“tariff digression”).

wwwwwwwwwwwwwwwwwwwwwwwwwwww .utut.ut.ututut.uuuuuuutu iliiliililiililiiliiiliitietietietiettietiettietieiiti s-ms-s-m-s-mmms mss e.e.eee.cee.commmmmommmmmmmmmmmmmmmmmmmmm

tively be dealt with by introduc-

ing so called feed-in tariffs. Under this system, individual producers of energy from renewable sources are being granted the right to feed the electricity they generate into the public grid and get paid fi xed rates for any kilowatt hour (KWh) they produce, or feed into the grid.

So how does this work in prac-tice given that the utility compa-nies will hardly be interested in purchasing electricity from indi-viduals at rates which are higher than those at which the company could produce the same amount of energy itself?

Simple. It works by putting a legal obligation on the utility com-pany to purchase such energy. In turn the utility company will charge its entire customer base for whatever additional cost it incurs by purchasing such fed-in electric-ity. Hence, ultimately it is the con-

Dr. Michael Krämer believes feed-in tar-rifs are viable in the

Middle East.

FEED-IN TARIFFS

www.utilities-me.com

place it suddenly becomes possi-ble for me to install my own private wind turbine or solar array regard-less of whether the amount of elec-tricity generated actually fi ts my needs at any given time. If I am pro-ducing too much energy I can feed it back into the public grid, and if what I am producing is insuffi cient I can obtain the required balance from any power socket.

At the same time I am gaining security for my investment. I know that every kilowatt of energy I am producing either saves or even earns me money. All of my “home grown” energy that I consume myself reduces my utility bill and any excess amount that I am feed-ing into the grid actually earns me money. This provides a sound basis for my calculations in terms of time required to recoup my investment. It also makes high volume investments (e.g. into complete tidal-wave or geother-mal power plants, or offshore wind parks) much more interesting to, for example, institutional inves-tors.

ATTRACTING PRIVATE INVESTMENT – BIG AND SMALLThe introduction of feed-in tariff schemes has led to a sheer explo-sion in private investment into renewable energy production in most countries where these schemes are now available. Spain, for example, has seen a massive increase of solar energy being produced, both by individuals as well as companies via large solar farms. Denmark, on the other hand, has seen a large increase in the amount of wind turbines that have been installed. In Germany, the installation of solar panels on private roofs has become intensely popular whilst institutional inves-tors fi nance the construction of massive offshore wind parks in the North and Baltic Seas.

The fact that the prices being

“The introduction of feed-in tariff schemes has led to a sheer explosion in

private investment into renewable energy production in most countries where these

schemes are now available.”Dr. Michael Krämer, Taylor Wessing

16 Utilities Middle East ● May 2010

paid depend on the means by which a certain renewable energy has been produced further ensures that no discrimination of a particular energy source occurs. Hence, although wind energy may be cheaper to generate than solar energy, operators of wind turbines and solar arrays both have com-parable chances of generating money with their investment.

Such non-discrimination of cer-tain energy sources has the pos-itive effect that research is being undertaken in all directions instead of focusing on one partic-

ular means only. Together with the general support that the genera-tion of renewable energy currently experiences in many countries, this leads to an innovation-friendly climate in countries where such a non-discriminative approach is being applied. This may well be one of the reasons why the tech-nologies that are being developed in such countries count among the leading technologies that are currently available in the renew-able energy fi eld. It may thus be an incentive to follow a similar path here in the UAE.

It should be mentioned, in fair-ness, that there is also a downside to putting a feed-in tariff frame-work in place. As mentioned above, utility companies are being forced to purchase energy at pre-set prices, which, as yet, are not usually competitive. This will inev-itably lead to higher electricity costs for all of us.

In addition, the incentive to invest in renewable energy that is being provided by feed-in tariff schemes will constantly have to be monitored and adjusted if nec-essary. If generation of a partic-ular form of renewable energy becomes too popular, a reduction in the price paid for such energy must be considered in order to avoid overall electricity costs get-ting too high.

It might be a price worth paying. In Germany, for example, the aver-age household now pays only about AED 20 a month more for their electricity than they did prior to the tariff being introduced. In the long term, this is likely to be AED 20 well invested.

Feed-in tariffs are promoting small scale renewable power generation world wide.

GET

TY IM

AG

ES

IWPP


Powering AheadHow ADWEA has led the way in PPPs for power and water projects in the Middle East

IWPP


T he Middle East is engaged in a power struggle. Gov-ernments are racing to

meet the skyrocketing demand for electricity and water of increas-ingly urban and industrialized societies, and are always in danger of falling behind.

In 2009 alone, power consump-tion in Abu Dhabi rose 11 percent to 6.255MW, the emirate’s larg-est ever annual increase. In 2010, peak power demand is likely to reach around 7.600MW, predicts the Abu Dhabi Water and Electric-ity Company.

Other countries are facing a similar mountain to climb. Saudi Arabia, the largest economy in the Middle East, is forecast to have power needs of 65.000MW in 2018. Last year is was unable to satisfy consumption levels, which at 41.200MW outstripped the kingdom’s power capacity. Abu Dhabi, on the other hand, is meet-ing its needs comfortably, with an installed capacity of around 10.000MW.

To facilitate the development of the power and desalination sector, governments in the region turned to public private partner-ships (PPPs) to fi nance Indepen-dent Water and Power Produc-ers (IWPPs). Abu Dhabi is draw-ing power and water from eight IWPPs. The Fujairah II project, which is currently in commis-sion and which will supply both the Northern Emirates and Abu Dhabi, will be the largest in the GCC. Across the region, power and desalination projects are the result of partnerships between the government and private compa-nies.

IWPPs in the Middle East differ from the common defi nition of a PPP. While the government will typically help out the private com-pany involved in the project with direct or indirect subsidies, it will also hold a stake in the venture. The adaptation of the concept has

varied, and different models have emerged.

Oman endorsed the private own-ership of its power infrastruc-ture early on, and has gone fur-ther down the route of privatisa-tion than any other country in the region, even allowing for 100 per-cent private ownership.

THE ADWEA MODELBut it is the model endorsed by the Abu Dhabi Water and Electric-ity Authority (ADWEA) that has gained most traction in the region. “The ADWEA model is regarded as the leading independent power plant model certainly in North Africa and the Middle East, and everyone’s been imitating it for a long time,” says Ranald Spiers, executive director at International Power, which owns 20 percent of Fabco, the Fujairah II holding company.

ADWEA will take a 50 or 60 per-cent share in the IWPP holding company, while the remaining stake is divided up between private developers. These then tied into the project with power and water purchase agreements (PWPAs) of 20 to 25 years.

For the companies, a large part of the attraction lies in the fact that ADWEA is a partner in the proj-ect. “We are comfortable with the model, because ADWEA is part of it,” says Michio Hayashi-bara, director at Marubeni Power Asset Management. Hayashibara is in charge of Marubeni’s oper-ations in the gas and water sector in Abu Dhabi, where the company is involved in four of the IWPPs in the emirate, and owns the other 20 percent of Fabco.

“Because ADWEA participates as a shareholder in the project company they are motivated to try and help ameliorate any negative impact if there are any problems,” explains Spiers.

The government agency’s inter-vention to salvage the Shuweihat II

IWPP in 2009 illustrates this point. When GDF Suez, who had been awarded a 40 percent stake in the project, struggled with the fi nanc-ing, ADWEA extended the power purchasing agreement (PPA). Crucially, it also approached Mar-ubeni and secured its participa-tion by allotting it half of GDF Suez stake in the holding company. Because of the involvement of the Japanese company, the Japan Bank for International Cooper-ation (JBIC), an export credit agency (ECA) stepped in with a US$1.1 billion loan to get the proj-ect of the ground.

While extending a helping hand when necessary, ADWEA does not like to get involved in the oper-ational side of an IWPP. “As long as things go well, they leave the man-agement to the shareholders,” says Hayashibara. “Even though they own a 60 percent majority share, all management decisions

depend on the executive manag-ing director of the holding com-pany.”

In fact, interfering in the operat-ing of the plant is not in the interest of a government agency. Financ-ing aside, the main reason for pri-vate sector involvement in core infrastructure is for utilities to benefi t from the effi ciency gains that experienced operators bring to the table.

FINANCIALLY ROBUSTAs Shuweihat II shows, the fi nan-cial crisis did put IWPPs in the Middle East to the test, a test that confi rmed the solidity of the model. Nevertheless, the turmoil in the fi nancial markets did put a brake in PPPs in the region. “It hasn’t stopped them altogether but it has slowed things. In Saudi Arabia it put a brake on the pro-cess,” says Marc Fèvre, senior associate at law fi rm Freshfi elds

“The ADWEA model is regarded as the leading model certainly in North Africa

and the Middle East, and everyone’s been imitating it for a long time”

Ranald Spiers, executive director at International Power.

IWPP


Bruckhaus Deringer. A case in point was the Kingdom’s deci-sion to not develop the Ras-al-Zour power and desalination plant on an IWPP basis, having lost patience with the inability of private compa-nies to get the fi nancing together.

But while fi nanciers have become more selective, power and water projects were still seen as high quality projects and safe investments, says Fèvre. “In the region as a whole, it meant that only the best projects got done. The projects with the best govern-ment support, with the best risk allocation, done in the sectors with most certainty to banks; princi-pally power.”

As far as the long-term suc-cess of the model is concerned, some argue that because of the crisis, PPPs have become even more interesting to governments, which have come to appreciate the value that private sector involve-ment can unlock. “Governments are now paying a lot more atten-tion and effi ciency in delivery in all infrastructure sectors, so they’re looking to the PPP models to deliver value for money,” says Michael Palmieri, corporate fi nance partner at KPMG.” And it seems poised, because of a focus on value for money, for even more growth when the economies are coming back, which they seem to be.”

It is not only governments in the region who have spotted opportu-nity in crisis. Hayashibara is keen to stress Japan’s interest in devel-


oping ties with the oil rich coun-tries in the Middle East. “The GCC countries are very important to Japan. One quarter of our oil exports come from Saudi Arabia, and one quarter comes from the UAE. We think that investment in the region, especially in the UAE, is very important to maintain good relationships.”

JBIC’s loans to help fi nance IWPPs can be seen as goodwill gestures, while they also encour-age utility providers to do business with Japanese fi rms. But ECAs are not unique to Japan. The success

of the South Korea’s Korea Elec-tricity Power Corporation (Kepco) in securing the contract to built four nuclear reactors in Abu Dhabi was in no small part due to the help of such fi nancing arrangements.

And it is not only Japanese com-panies that have profi ted from JBICs loans. As JBIC is able to borrow money at costs that are far lower than the market rates for many private companies, it is in turn able to provide funding to projects at attractive rates. What is more, by providing around half of the debt required, they have been instrumental in making project fi nance work for IWPPs after lend-ing activity declined in the fi nan-cial crisis, according to Spiers.

“Throughout the last 12 months in terms of project fi nance, the ECAs have stepped up to the plate and been more active and have done a lot more than they have done in the past,” says Spiers. “If there had just been commercial banks, you would be struggling to

get the money together for a large deal. For in some ways the credit landscape has changed, a lot of banks have gone. Having an ECA act as an anchor lender, some-times providing 50 to 60 percent of the project debt is very helpful”

Despite taking a cautious view of infrastructure investments in the Middle East, banks are still fun-damental in providing capital to IWPPs. While RBS has effectively pulled out of fi nancing infrastruc-ture in the region, it used to be one of the biggest players alongside HSBC, Standard Chartered and BNP Paribas. Local banks have also been active in lending, but most of the bigger projects have not been fi nanced with their help.

Broadening the investor base beyond banks and ECAs has been diffi cult, says Fèvre. “Other than developer investors, there hasn’t been that much secondary market activity in terms of being able to buy into assets.”

While a few infrastructure invest-ment funds have been set up, their activities have been limited. Part of the reason is that there are not enough projects that have been put into the market, thinks Favre. On the back of limited opportu-nity, the ADIC-UBS Infrastructure Investment fund, a joint venture between the Abu Dhabi Invest-ment Company and the asset man-agement arm of UBS, is now being wound up, having failed to make a single investment.

Abu Dhabi’s TAQA is also heav-ily involved in investing in the Emirates IWPPs. It is, however, majority owned by the govern-ment though a 51 percent share-holding by ADWEA, and a 21 per-cent ownership by the govern-ment Farmer’s Fund, with only the remaining 28 percent fl oated on the stock exchange.

In countries whose coffers are not swelled by oil and gas reve-nues, PPP are much more critical in terms of fi nancing. Here, PPPs

Peak power demand in the UAE (MW)

2008 2009*

Abu Dhabi 5,616 6,255

Dubai 5,287 5,622

Sharjah 1,790 1,840

Other emirates 1,692 1,709

Source: Adwec* Estimated

“In Kuwait, the big problem is political risk as there is the constant struggle be-tween the executive and parliament and there is no certainty about what’s going

to happen to any particular projects”

Marc Fèvre, senior associate at Freshfi elds Bruckhaus Deringer.

IWPP


“Governments are now paying a lot more attention and effi ciency in delivery in all

infrastructure sectors, so they’re looking to the PPP models to deliver value for money”

Michael Palmieri, corporate fi nance partner at KPMG

by the private companies. “From a foreign bidder’s perspective, you are negotiating and implementing a very large contract, but you only might hold 20 percent of the equity in the project. So it is less material in terms of profi t and net MW,” says Spiers.

Oman has been causing some consternation amongst private companies in the past when the government delayed tenders and stalled projects. With no legal framework in place to boost inves-tor confi dence, countries rely on their track record, making Abu Dhabi a popular place to do busi-ness for developers. Some believe that implementing a PPP or con-cession laws could help coun-tries without such a track record to boost their appeal to the private sector.

are often used by development banks to get involved in infrastruc-ture building. In Jordan, several PPPs are being supported by the World Bank, while Egypt is receiv-ing support from the World Bank, the European Investment Bank, and the German development bank KfW.

“In countries which need infra-structure but can’t afford it there is a strong development angle,” concludes Fèvre.

POWERING AHEAD?So far, governments have had few diffi culities in attracting bidders for their projects, but there are a few misgivings.

While government participation drives down risk levels, a large ADWEA stake translates into a fairly small portion of ownership

Practical improvements would also be welcomed. A report by Freshfi elds Bruckhaus Deringer points to the fact that most coun-tries in the region lack a central government unit coordinating PPP activities, and advises gov-ernments to follow Egypt’s exam-ple in setting up such a unit. Inves-tors would profi t from added cer-

tainty on the terms of transactions and a more transparent procure-ment process, the fi rm says. “If you have such a department, you usually end up with an offi cial with key responsibilities,” adds Chris-tian von Tschirschky, principal and head of Utilities for the MENA region at consultancy ATK Kear-ney. “Having a key coordinator

IWPP


helps, especially as government institutions in the region are quite complex.”

Governments in Kuwait, Iraq and Dubai, which have not yet adopted the IWPP model to address their power and water needs, will have to consider all those issues.

Most observers see Kuwait some way off an IWPP. One problem for investors is the political system, says Fèvre. “In Kuwait, the big problem is political risk as there is the constant struggle between the executive and parliament and there is no certainty about what’s going to happen to any particular projects.”

Security concerns mean that Iraq will also have to wait some time before IWPPs become a pos-sibility.

In Dubai, plans are underway to built the emirate’s fi rst IWPP. The

proposed 1.500MW plant at Has-syan is expected to come online in 2013 or 2014. The project is at the advisory stage, observers believe that the procurement period may take longer due to Dubai’s inexpe-rience in handling IWPPs.

In light of the global fi nancial meltdown and the impact is has had on the GCC, developers are cautious about committing. “Par-ticipating companies may have certain prerequisites they want to see, for example that power proj-ects are backstopped by the gov-ernment, and potentially further backstopped by national funds,” says one contractor.

These concerns about fi nancing utility projects in the region high-lights one thing: public private partnerships in the Middle East are only as strong as the govern-ment that support them.

“The GCC countries are very important to Japan. We think that investment in

the region, especially in the UAE, is very important to maintain good relationships”

Michio Hayashibara, director at Marubeni


With a net generating capac-ity of 2000 MW and approxi-mately 600 000 cubic meters of potable water a day the Fujairah II project will be the largest IWPP in the UAE. A consortium comprising AD-EWA (60%), Marubeni (20%) and International Power (20%) own holding company Fujairah Asia Power Company (Fapco). Alstom and Sidem, a subsidiary of Veolia Water, have been awarded the en-gineering, procurement and construction (EPC) contract for Fujairah II . Marubeni and International Power are charged with operating and maintaining the IWPP in a 50:50 joint venture, under a 20 year PWPA. Power production rests on fi ve Alstom GT26 gas turbines. These will be capable of dual fuel operation, burning natu-ral gas, with the capability of operating on liquid fuel if the gas supply is interrupted. The GT26 has a rated output in open cycle application of 288.3 MW and an effi ciency of 38.3 per cent.The desalination plant is made up of two sections, one based on Multiple Effect Dis-tillation (MED) and the other on Reverse Osmosis (RO). The largest of these, the MED sec-

tion, takes steam from the combined-cycle power plant to generate potable water. The smaller section based on RO is driven not by steam but by power. This combination allows for the optimisation of steam and power output from the combined-cycle power plant in order to provide constant water production as power demand varies with the seasons.The total project costs of Fujairah II amount to US$2.7 billion. Of this, US$ 2.1 bil-lion has been fi nanced by long term debt, of which ap-proximately half has been lent by JBIC. The equity amount worth US$565 million was fi nanced by an equity bridge facility, according to Inter-national Power, which will have to be repaid by ADWEA, Marubeni and International Power in proportion to their equity stake in July.The plant is in the process of commissioning its gas turbines, and testing its de-salination units. According to International Power manag-ing director Ranald Spiers, Fujairah II will start becoming operational within Q2. The project has been built ad-jacent to the existing Fujairah I plant.

THE FUJAIRAH II IWPP

A 3D Model of the Fujairah II power and desalination plant

The Arabian Business Achievement KSA Awards 2010The premier event for business leaders in the Middle East.

For nominations contact: [email protected] sponsorship enquiries: Rabih Naderi +966 50 3289818

Retail Bank of the Year

Investment Bank of the Year

Retail Company of the Year

Telecoms Company of the Year

Insurance Company of the Year

Special CSR Award

Businessman of the Year

Fast Growing Company of the Year

Hospitality and Tourism Company of the Year

Technology Company of the Year

Most Innovative Investment Bank of the Year

Construction Company of the Year

Logistics Company of the Year

Best Commercial Developer

Best Residential Developer

Industrial Company of the Year

Lifetime Achievement

An ITP Executive Event

1st June 2010 | Al Faisaliah Hotel Riyadh www.arabianbusiness.com/ksaawards2010

Gold SponsorPowered by Silver Sponsor

PUMPS & VALVES


Striving for effi ciencyWith the market still recovering from the delayed impact of the recession, manufacturers must look to product innovation to remain competitive, as end users are seeking to ensure energy efficiency

Water is a precious resource in the Middle East, and is guaranteed to keep utilities providers spending on infrastructure for some time to come. As pumps and valves are an integral part of the systems deliver-ing and making use of water, they are in demand, and the region has been a reprieve for suppliers strug-gling for business in other parts of the world.

“The Middle East has fared the best compared to other markets mainly due to the fact that water in the Middle East is scarce and hence expensive”, says Imtiyaz Kud-chikar from Lutz-Jesco, a pumps manufacturer.

Market players say the global recession hit the region with a one year delay, but did not stay around for long. “Due to the good recovery of oil prices by mid-2009, the down-turn in the region only lasted nine to ten months,’ says David Sonzo-gni of Emerson Leroy-Sumer, who manufacture electric motors used in pumps, and recently supplied the district cooling pump motors and circulation pump motors for the Burj Khalifa in Dubai.

While oil prevented the crisis from entrenching itself in the region, commodity prices were also a major reason why projects were delayed, according to Sonzo-gni. “The big project owners, and the oil companies, thought that if they waited for six months, the price for concrete and steel would go down and they can get the job done at a discount.”

But because projects which were close to completion were not

stopped due to the downturn, it took some time for these delays to make a dent in regional orders. “Since Emerson gets its orders at the advanced stage of an MEP con-tract, we have had very good sales in 2009,” says Sonzogni.

On the fl ip side, this delayed effect meant that orders started to run dry in the fourth quarter of 2009, and are still not back to

“Energy effi ciency is a big issue at the moment, and end users are putting a lot of pressure on us to come up with cost

effi cient products”Surith Nair, Aeon

A pump used in district cooling applications.

normal now. Things are about to change again, however, as a fl urry of utility and oil and gas projects have been announced in the fourth quarter of 2009, with district cool-ing being one sector where the recovery is most palpable.

As sales volumes slumped, sup-pliers tried to salvage some busi-ness by providing additional ser-vices to their customers. “In Dubai and Bahrain, were there wasn’t much growth in the last two quar-ters, we improved those installa-tion we have installed and serviced the customer,” says Kudchikar.

Crisis or no crisis, conserving energy is one issue that buyers of pumps and valves are becoming increasingly sensitive to. While the region may not suffer a shortage of crude output, utility providers are struggling to supply ever-expand-ing cities and industrial complexes. “DEWA and the others aren’t trying to conserve energy because they want to save the world, they have no choice,” comments one source. Pri-vate companies are similarly look-ing to make a saving.

“Energy effi ciency is a big issue at the moment, and end users are

PUMPS & VALVES


putting a lot of pressure on us to come up with cost effi cient prod-ucts, which can be used for the long run,” says Surith Nair from AEON, a manufacturer of valves. Aeon is currently looking to develop a range of energy effi cient products to cater for this demand.

“Customers are looking for better insulation material, and higher effi ciency pumps and valves,” says Sonzogni. Emerson Leroy-Sumer wants to capitalize on this trend by offering energy effi -cient motors to their customers in the region.

As end users are looking to make savings on energy, are they equally keen to keep equipment costs down? Kudchikar believes so: “People are now going for cheap products, and we can’t compete with some Chinese and Italian man-ufacturers on price. Their products

are now widely accepted here, cus-tomers accept a product life of only three to four years.”

But others disagree. “End users know what they want. Quality is very much in their mind, I don’t think anyone can push in if they

Pumps with Emerson Leroy-Sumer motors in the Sulaibiya water treatment plant in Kuwait.

don’t have the quality at hand,” says Nair. For him, one of the challenges his company is facing is complying with the cornucopia of different specifi cations that governments and the private sector require. “Every end user has own specifi ca-

tion to comply, and each market has their own requirements.”

With all this to keep in mind, it is certainly not a time for manufac-turers of pumps and valves to slash their research and development budget.

TRANSFORMERS


The transformer market is set for growth, and local producers are looking to play their part in the success story

Generators, a vital component of these networks, are in demand. But it has not all been plain sailing for producers and service provid-ers, as the global economic crisis slowed the pace of infrastructure projects across the region.

A STORM IN A TEA CUP? While things are looking up, the pace of recovery differs. “Key challenges to our business in the region include relatively reduced market demands in some coun-tries due to the effects of the global economic recession to meeting rapidly increasing demands in

Electricity distribution is a subject even the least technica l ly -minded residents of the GCC

cannot hope to avoid, as power fail-ures have plagued the region for years. Recently, one of the major steps taken towards securing a stable supply of energy has hit the headlines when the fi rst stage of the GCC interconnection grid became operational.

In the face of rapidly developing industrialisation and urbanisation of the Middle East, the need for an expansion of transmission and distribution networks is apparent.

pretty much as normal,” say Andy Hedgecock, general manager at Omicron, a provider of diagnosis and evaluation services for trans-formers. “Counties have pretty healthy bank accounts because of the oil revenues, so the infrastruc-ture plans slowed a little bit, in

other countries, “says Mohammad Megdad, business unit manager at ABB in Saudi Arabia.

Nevertheless, for some the downturn has been little more than a storm in a tea cup. “There was a bit of a blip but generally in the Middle East things carried on

Heading in the right direction

An ABB transformer is on its way to a substa-

tion in Kuwait.

“The local utility companies prefer to buy locally if the quality is good enough”

Andy Hedgecock, Omicron

TRANSFORMERS


some markets in particular. Dubai has seen quite a dramatic slow-down. In contrast, Abu Dhabi went on quite normally.”

Yet even the wealthy Abu Dhabi Water and Electricity Author-ity has been dragging its heels on new projects, according to Manu Domen, general manager at Brush Transformers Gulf. “ADWEA has not done much for the last year of so, and now suddenly they are

starting up again.” Overall, the market

favours the customer, as producers are fi ght-ing for business. “Our order book is reason-able enough, but it is not as good as it was in 2007. We are still almost 30 percent off those levels,” says Suresh

Madhav, regional manager at Tesar, a manufacturer of

dry transformers. “It is still very much a buyer’s market,”

says Domen, “Prices for trans-formers have come down dramat-ically.”

DIVERSIFY OR DIELimited sales volumes have forced producers to rebalance their busi-ness model. It is no coincidence that Omicron, who specialise in equipment diagnostics, are blasé about the downturn. Customers who are watching their pennies

are keen to avoid buying expen-sive new transformers, giving pro-ducers the opportunity to offset fl agging sales volumes by focus-ing on the servicing and testing of transformers.

“We are trying to diversify a little bit, and are now focusing more and more on servicing the indus-try, oil testing, analysing the life of a transformers, refurbishment, tab changes, all that kind of stuff,” says Domen. “

Such work can translate into big savings for customers. The main

some mahas seendown. In on quite n

Yet evenWater aity has benew projDomen, gTransformnot doneof so, and

st

Mat T

dry tvery mu


Manu Domen, Brush Transformers Gulf

“It is still very much a buyer’s market. Prices for transformers have come down

dramatically”

TRANSFORMERS


Copper is the key raw mate-rial needed to produce trans-formers, and price fl utuations are threatening producer’s margins.

Over the last two years, there have been huge price swings. (see chart) After peaking at around US$9000/ tonne in 2008, prices slumped to below US$3000/tonne in 2009, before surging back up to almost US$8000/tonne.

“If you tender for trans-former you have to assume a

copper price, says Manu Do-men from Brush Transformers. “If that tender comes to an order, and the copper price went up, the difference in price will have to be taken care of by the producer, be-cause here most utilities don’t allow for variations in the copper price.” Even if utilities in the Middle East do take copper price fl uc-tuation into account, it is un-likely to be to the benefi t of producers. “The price volatil-

ity during last few years has led several key utilities in the region to start applying price variation formulas to reduce the risk of manufacturers sud-denly increasing prices. This helps utilities avoid paying higher margins,” says Mo-hammad Megdad from ABB.

THE COPPER PRICE: A THREAT TO MARGINS

component inside a generator is a silicon steel core, which is encased in copper windings. As generators get older, the insulation material around the copper becomes brit-tle and breaks up. Replacing the insulation is suffi cient to get a gen-erator back into working order, and costs a fraction of the outlay required for a new machine.

AGE CONCERNAn increasing focus on services is not only the result of utilities becoming more cost conscious, however. It is also a consequence of existing generators reaching the end of their lifespan.

While this is less acute in the Middle East, where infrastruc-ture is often more modern than in other parts of the world, the indus-try is paying more attention to the maintenance of existing networks. “With most electrical energy sup-pliers focusing increasingly on the reliability and effi ciency of their supply systems and controlling their capital expenditures, a big focus is put on handling such aged transformers in their networks,” sums up Megdad.In the long run, of course, even the best-main-tained generators will need to be replaced. This is the cause of some optimism for some market partici-pants, who see a brisk trade ahead.

“Our order book is decent enough , but we are still almost 30 percent of 2007

sales levels”

BUY LOCAL – SELL BIGSupplier manufacturing locally are keen to grow their business on the back of this rosy outlook by expanding their product range.

Most of the power transformers, which can handle 220 or 440 kilo-watt, are produced outside the Middle East, but this is changing, as some local producers are cur-rently preparing for the produc-tion of power transformers.

Proximity to the end user gives them a key advantage over their competitors from Europe, the US, or Asia. Not only are they able to offer substantially lower deliv-ery times, but they are also able to show up at short notice should there be any problems with their product.

Lead times, especially for the large power transformers, are a nuisance for customers every-where. As generators are highly specialised machinery that cannot be mass produced, utilities are often forced to order two or three years in advance.

The recession and the subse-quent drop in demand brought down waiting times a little, “but you don’t build a transformer in few weeks,” comments Hedge-cock.

Brush Transformers is one company looking to get in on the

action. “We have our people here, if there is a problem we can just jump in the car and we’re there. Whereas if you have a transformer from Japan, lets say, you’ll wait for them and you’ll pay for them,” says Domen. Having been forced

to expand their business model to counter fl agging demand, compa-nies like Brush can now offer their regional clients a comprehensive service at short notice.

There are further competitive advantages: Domen claims that producing locally is cheaper. And home advantage is not something confi ned to the football pitch. If the government built the country’s infrastructure while supporting the national economy, it will do so.

“The local utility companies prefer to buy locally if they can if the quality is good enough,” says Hedgecock.

The transformer market is not only benefi ting from the ambi-tious targets governments are setting themselves for infrastruc-ture growth, they are also part of the very development of industry of the region that this expansion is set to cater for.

Suresh Madhav, regional Manager at Tesar.

QUICK Q&A


A qualifi ed chemical engineer, he became an entrepreneur in 1983 by starting membrane sup-plier Ropur as a joint venture with Mitsui in Switzerland. “Alongside Dow Filmtec, we became the lead-ing membrane supplier in Europe by the late eighties, “ says Kallen-berg.

Ropur was doing business in the Middle East soon after, working on drinking water projects in Iraq in 1987, and penetrating the Saudi Market in 1989.

In 1994, he became the sole owner of Ropur. He ran the inde-pendent company for the next ten years, before he realized that fur-ther growth necessitated the inte-gration into a larger structure. Kallenberg sold Ropur to Toray Industries Japan, packed his bags, and relocated to Dubai, where he is now running the Toray’s Middle Eastern business. In the region, the company is still registered as Ropur, “there were some prob-lems with the name registration process.”

Utilities Middle East caught up with Klaus Kallenberg on a sunny spring day at the Dubai Marina.

from future growth there. Besides seawater reverse osmosis, there is a huge market for purifying brack-ish water, and a lot of potential in the wastewater sector. In a coun-try like Saudi Arabia, which relies one hundred percent on desalina-tion, there is naturally a huge inter-est in reusing wastewater.

We can offer the whole spec-trum of products for this process,

and are already engaged in big projects in Saudi Arabia where we make use of the membrane bioreactor technology to turn wastewater into relatively high-quality water for industrial and agricultural use.

We then often use advanced reverse osmosis technology to fi lter out the salt that found its way into the water as part of the clarifi -cation process.

: You specialise in reverse osmosis (RO) membranes. Has this become the dominant method for desalination in the Middle East?No. The switch to RO desalina-tion hasn’t happened yet. Most of the big plants currently operat-ing and under construction will be fi tted multi-stage fl ash (MSF) or multi-effect distillation (MED) thermal technology. We are of course hoping for this to change. Apart from the fact that MSF is very energy intensive, RO has the advantage that it provides fl exi-bility. In an Integrated Water and Power plant (IWPP) relying on MSF or MED, the output of desal-inated water is coupled to the power production, desalination cannot be done independently. So we are seeing a trend towards hybrid plants, for instance in Abu Dhabi, where both MSF-MED and RO membranes are used.

: Researchers have devel-oped a new, effi cient and more fouling resistant desalination process based on nano technol-ogy, hailed by some as a break-through. Are you excited by this development?

Klaus Kallenberg, general manager at Toray Membrane Europe is a veteran of the desalination industry who started doing business in the Middle East over twenty years ago

PEOPLE METERMembrane Matters

: Utilities: Mr Kallenberg, has business in the region recovered from the global eco-nomic downturn?The crisis is not over yet, that’s for sure. But it has bottomed out, and we are starting to see some green shoots. Even the UAE is showing signs of recovery, with very large RO projects coming up. Saudi Arabia is going strong, the infra-

structure projects there were never stopped. Qatar, Kuwait, Oman are all investing in infra-structure, and we are of course getting business from the oil industry.

: In which Middle East-ern markets do you see further growth?We are very well positioned in Saudi Arabia, and expect to benefi t

“We are seeing a trend towards hybrid integrated power and water plants, were both MSF-MED and RO mem-

branes are used ”

QUICK Q&A


“In a country like Saudi Arabia, which relies one hundred percent on

desalination, there is naturally a huge interest in reusing wastewater. ”

A reverse osmosis membrane fi lter.

This technology is still in the development stage, with the fi rst products being tested now. It is too early to speak of a breakthrough yet, but it is something with big

potential. We are expecting better results in terms of fouling behav-iour and salt retention, which makes this the process less energy intensive, and thus cheaper.

PROJECTS

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

9023/9001 Underground Cables

Saudi Electricity Company (SEC) Al Fanar Contracting 46 project under

constructionPower Transmis-sion

380kV Transmission Line - North of Riyadh

Saudi Electricity Company (SEC)

KEC International / Al Sharif Group for Con-tracting & Development Trading

64 project under construction

Power Transmis-sion

Desalination Plant & Drinking Water Infrastructure

Emaar Economic City,Saudi

Huta-Hegerfeld & Huta-Marine Limited Company

53 project under construction Desalination Plant

Desalination Plant in Jeddah - Phase 3

Saline Water Conversion Corporation (SWCC)

Kuljian EngineeringCorporation

Doosan Heavy Indus-tries & Const. Company / Saudi Berkefeld Filter (Witco)


115kV Underground Cables in Madina 2nd Industrial City

Saudi Electricity Company (SEC) Siemens 35 project under


132/13.8 kV 8122-Substation in Al Morooj

Saudi Electricity Company (SEC) Al-Osais Group 50 project under

construction Substation

10J Substation & 101 Satel-lite Substation in Yanbu

Royal Commission for Jubail and Yanbu (RCJY) Siemens 150 project under


Princess Noura Bin Abdulrah-man University - High Volt-age Substation

Ministry of Higher Educa-tion / Ministry of Finance

ABB Contracting Co. / Al Fanar Contracting 167 project under


Yanbu IWPP

The Power & Water Utili-ties Company for Jubail & Yanbu (Marafi q)/Saline Water Conversion Corpo-ration (SWCC)

MohammedA.Turki Mott MacDonald

Not Appointed 4000 project under design

Power and Desali-nation Plant

Qsai Dam at Jizan Ministry of Water and Electricity,Saudi Arabia

Zuhair Fayez & Partners

Bin Jarallah Establish-ment for Trading & General Contracting (Bin Jarallah Group)

40 project under construction Dam

380/110/13.8-kV Substation Expansion in Al Aziziyah Area

Saudi Electricity Company (SEC) Siemens, Saudi 20 project under


Power Plant Expansion - Duba


Najm Al Jazirah for Trading Contracting & Agriculture Co.

120 project under construction Power Plant

King Abdullah Economic City (KAEC) - Power Grid Package

Emaar Middle East Properties Siemens 400 project under


Power and Water Plant in Ras Al Zour

Saudi Arabian Mining Company (Maaden) / Rio Tinto Alcan

Not Appointed 2500 project under design

Power & Desali-nation Plant

New Dam in Abha Ministry of Water and Electricity

Zuhair Fayez & Partners

Bin Jarallah Establish-ment for Trading & General Contracting (Bin Jarallah Group)

16 project under construction Dam

Substations 9024 and 8183/8184

Saudi Electricity Company (SEC) ABB Contracting Co. 120 project under


Interim Power Plant at YanbuThe Power & Water Utili-ties Company for Jubail & Yanbu (Marafi q)

Not Appointed 300 EPC Bid Power Plant

MIDDLE EAST

Project Title Client Consultant Main Contractor

Value / Value Range (US$. Mn) Project Status Project Type

SAUDI


PROJECTS

Rabigh IPP - 380-KV Substa-tion

Saudi Electricity Company (SEC); ACWA Power International; Korea Electric Power Corporation (Kepco);

ABB Contracting Co., Saudi Arabia 48 project under


Uqair Power Plant Saudi Electricity Company (SEC) Not Appointed 1500 project in concept

stage Power Plant

380 Substation at Al Dhahi-yah - Stage2


Al Toukhi Company for Industry & Trading 70 project under


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

Karan Gas Field Exploration - Utilities and Co-generation Package

Saudi Aramco Foster Wheeler, Saudi Arabia Petrofac, Saudi 500 project under

constructionCo-generationPlant

Qurayyah - 2 Simple Cycle Power Plant


Arabian Bemco Con-tracting, Saudi Arabia; Doosan Heavy Indus-tries & Const. Company, Saudi Arabia;


UAE

Hassyan Complex - Station P - Phase 1 (P1)

Dubai Electricity and Wa-ter Authority (DEWA)

Mott MacDon-ald, Dubai Not Appointed 3000 EPC Bid Power and Desali-

nation Plant

Hassyan Sea-Water Cooling System

Dubai Electricity and Wa-ter Authority (DEWA) Not Appointed 1800 EPC Bid Water Distribu-

tion

Fujairah 2 (F2) IWPPADWEA/ Marubeni Corporation/ International Power

Fichtner Alstom Power / Sidem 3,000 project under construction

Power and Desali-nation Plant

Water Treatment Plant - Das Island

Abu Dhabi Marine Operat-ing Company (Adma-Opco)

Metito Abu Dhabi LLC 21 project under construction Water Treatment

Desalination Plant near Hamriyah Free Zone

Sharjah Electricity and Wa-ter Authority (SEWA)

Aqua Engineering, Techton Engineering & Construction


General Utility Plant Expan-sion at Ruwais

Abu Dhabi Oil Refi nery Company (Takreer) Not Appointed 500 EPC Bid Power Plant

Upgrade of Irrigation Net-works and Pumping Stations

Department of Munici-palities & Agriculture-Abu Dhabi

Not Appointed 10 EPC Bid Pumping Station

Nuclear Power Plant in Abu Dhabi

Abu Dhabi Water and Electricity Authority / Emirates Nuclear Energy Corporation

Korean Electric Power Company / Hyundai En-gineering & Construc-tion Company/Samsung C & T Corporation/ Doo-san Heavy Industries


Installation of 11kV Cables in Dubai

Dubai Electricity and Wa-ter Authority (DEWA) Econ Contracting LLC 25 project under


Two Desalination Plants in Ajman

Federal Electricity & Water Authority (FEWA)

Tecton Engineering & Construction; Aqua Engineering;


KUWAIT

11kV Overhead Transmission Line for Subiya Road

Ministry of Electricity & Water (MEW), Kuwait

National Contracting Company (NCC), Kuwait 11 project under


New Substations in Kuwait Ministry of Electricity & Water (MEW), Kuwait Not Appointed 30 EPC Bid Substation

Water Storage Tanks in West Funaitees

Ministry of Electricity & Water (MEW), Kuwait Not Appointed 500 EPC Bid Water Distribu-

tion

Shuwaikh Desalination Plant Ministry of Energy (Elec-tricity & Water)

Doosan Heavy Indus-tries & Construction Kuwait



TENDERS


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

UPGRADING OF THE COMPLETE SCADA SYSTEM IN RQWTS LINES A & B Issuer: Saline Water Conversion CorporationTender number: RQWTS-SCADATitle: Upgrading of the Complete SCADA System in RQWTS Lines A & BDescription: The scope of work includes upgrading of the complete SCADA System, communication system & communication cable in RQWTS Lines A & B.Bond: N/ATender fee: 5000.00 SAR Closes: May 2, 2010Contact: www.swcc.gov.sa

CONSTRUCTION WORKS OF RAS AL-ZOUR - HAFR AL-BATIN WATER TRANSMISSION SYSTEMIssuer: Saline Water Conversion CorporationTender no: RHWTS-MSSPTitle: Construction Works of Ras Al-Zour - Hafr Al-Batin Water Transmission SystemDescription: The scope of work includes construction of Ras Al-Zour - Hafr Al-Batin water transmission system and the related works.Bond: N/ATender fee: 100000.00 SARCloses: May 3, 2010Contact: www.swcc.gov.sa

CONSTRUCTION OF NEW GENERATORS AT DIBBA POWER STATION IN MUSANDAM GOVERNORATEIssuer: Rural Areas Eletricity Compant S.A.O.CTender number: 89/2010Title: Construction of New Generators at Dibba Power Station in Musandam GovernorateDescription: The scope of work includes relocation of 1x4.6 MW DG set from Mudhairib Power Station to Dibba Power Station in Musandam Governorate.Bond: N/ATender fee: 350.00 OMRCloses: May 3, 2010Contact: www.tenderboard.gov.om

OPERATION & MAINTENANCE OF NIZWA WATER SUPPLY SYSTEMIssuer: Public Authority for Electricity and WaterTender no: 88/2010

Tender activityVisit constructionweekonline.comfor the latest tender information

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

Title: Operation & Maintenance of Nizwa Water Supply SystemDescription: The scope of work includes operation & maintenance of Nizwa Water Supply System in Oman.Bond: N/ATender fee: 225.00 OMRCloses: May 3, 2010Contact: www.tenderboard.gov.om

CONSTRUCTION OF WATER SUPPLY SYSTEM TO HADF AND ALFAY TOWNS Issuer: Public Authority for Electricity and WaterTender number: 92/2010Title: Construction of Water Supply System to Hadf and Alfay TownsDescription: The scope of work includes construction of water supply system to Hadf and Alfay towns in Wilayat Mahdah.Bond: N/ATender fee: 1000.00 OMRCloses: May 3, 2010Contact: http://www.tenderboard.gov.om

MAINTENANCE SERVICES FOR A/C IN SHOUIBA SOUTH IWPPIssuer: Central Tenders CommitteeTender no: MEW/63/2009/2010Title: Maintenance Services for A/C in Shouiba South IWPPDescription: The scope of work includes maintenance services for A/C in Shouiba South Independent Water & Power Plant (IWPP).Bond: ApplicableTender fee: 170.00 KWD Closes: May 4, 2010Contact: Central Tenders Committee - Ministry of Electricity & Water

OPERATION & MAINTENANCE WORK OF ALL FIRE ALARM AND FIRE FIGHTING SERVICES IN STORAGE AREAS IN SHUWAIKH AREAIssuer: Central Tenders CommitteeTender no: KPA/30/2009Title: Operation & Maintenance Work of All Fire Alarm and Fire Fighting Services in Storage Areas in Shuwaikh Area

Description: The scope of work includes operation & maintenance work of all fire alarm and fire fighting services in storage areas number (2, 4, 6, 7, 8 & 9) in Shuwaikh area.Bond: ApplicableTender fee: 30.00 KWDCloses: May 4, 2010Contact: Central Tenders Committee - Kuwait Port Authority

MANUFACTURE AND SUPPLY OF STEEL PIPES FOR RAS AL-ZOUR - HAFR AL-BATIN WATER TRANSMISSION SYSTEMIssuer: Saline Water Conversion CorporationTender no: RHWTS-MSSPTitle: Manufacture and Supply of Steel Pipes for Ras Al-Zour - Hafr Al-Batin Water Transmission SystemDescription: The scope of work includes manufacture and supply of steel pipes for Ras Al-Zour - Hafr Al-Batin Water Transmission System.Bond: N/ATender fee: 100000.00 SAR Closes:May 5, 2010Contact: www.swcc.gov.sa

0.433/11-KV SECONDARY SUBSTATION IN KUWAITIssuer: Central Tenders CommitteeTender no: MEW/93/2009/2010Title: 0.433/11-kV Secondary Substation in KuwaitDescription: The scope of work includes construction of 0.433/11-kV secondary substation in Kuwait.Bond: ApplicableTender fee: 2500.00 KWD Closes: May 9, 2010Contact: Central Tenders Committee - Ministry of Electricity and Water

SUPPLY, INSTALLATION, TESTING AND COMMISSIONING OF 2 NOS. 132/11-KV SUBSTATIONSIssuer: Dubai Electricity & Water Authority (DEWA)Tender no: CE/0026/2010Title: Supply, Installation, Testing and Commissioning of 2 Nos. 132/11-kV Substations

TENDERS

May 2010 ● Utilities Middle East 39www.utilities-me.com

Description: The scope of work includes supply, installation, testing and commissioning of 2 Nos. 132/11-kV substations and associated works.Bond: ApplicableTender fee: 5000.00 AEDCloses: May 9, 2010Contact: www.dewa.gov.ae

CONSTRUCTION OF ADDITIONAL TANKER FILLING STATIONS IN ASH SHARQIYAH REGIONIssuer: Public Authority for Electricity and WaterTender no: 105/2010Title: Construction of Additional Tanker Filling Stations in Ash Sharqiyah RegionDescription: The scope of work includes construction of additional tanker fi lling stations in Ash Sharqiyah Region.Bond: N/ATender fee: 1500.00 OMRCloses: May 17, 2010Contact: www.tenderboard.gov.om

UPGRADING SWAIHIRAH PRIMARY SUBSTATIONIssuer: Majan Electricity Company (SAOC)Tender no: 111/2010Title: Upgrading Swaihirah Primary SubstationDescription: The scope of work includes upgrading Swaihirah primary substation from 2x6 MVA to 2x20 MVA. The substation located in north Batinah region.Bond: N/ATender fee: 473.00 OMRCloses: May 24, 2010Contact: www.tenderboard.gov.om

CONSTRUCTION OF AL-ZOUR NORTH IWPPIssuer: Central Tenders CommitteeTender no: MEW/32/2008/2009Title: Construction of Al-Zour North IWPPDescription: The scope of work includes construction of Al-Zour North Independent Water & Power Plant (IWPP).Bond: ApplicableTender fee: 5000.00 KWDCloses: May 30, 2010Contact: Central Tenders Committee - Ministry of Electricity & Water

COMPLETE OVERHAULING, TESTING FOR LIFE EXTENSION OF TURBINE NO. 13 IN JEDDAH PLANT PH. 4Issuer: Saline Water Conversion CorporationTender no: JD/RM/415Title: Complete Overhauling, Testing for Life Extension of Turbine No. 13 in Jeddah plant Ph. 4Description: The scope of work includes overhauling and testing for life extension of Turbine No.13 in Jeddah Plant Ph. 4.Bond: N/A

CONSTRUCTION OF RAS AZ ZAWR POWER AND DESALINATION PLANT - PHASE 1The Saudi Saline Water Conversion Corporation has issued a tender for the construction of Phase 1 of the Ras Az Zawr power and desalination plant. The contract covers two packages, package “P” for power plant & package “D” for desalination plant. The tender number is RZP-D and the fee is 200 000 SAR. The tender closes on May 9, 2010

Contact: www.swcc.gov.sa

KEY CONTRACT

Tender fee: 500.00 SAR Closes: Jun 5, 2010Contact: www.swcc.gov.sa

RECONSTRUCTION AND REHABILITATION OF BOILER IN JEDDAH PLANT - 4Issuer:Saline Water Conversion CorporationTender no:JD/RC/568Title: Reconstruction and Rehabilitation of Boiler in Jeddah Plant - 4Description: The scope of work includes reconstruction and rehabilitation of boiler in Jeddah Plant - 4.Bond:N/ATender fee:500.00 SAR Closes: Jun 6, 2010Contact: www.swcc.gov.sa

REHABILITATION OF 13 PUMPS IN JEDDAH SUBSTATION - PHASE 4Issuer: Saline Water Conversion CorporationTender no: JD/R/M/197Title: Rehabilitation of 13 Pumps in Jeddah Substation - Phase 4Description: The scope of work includes rehabilitation of 13 pumps in Jeddah Substation - Phase 4.Bond: N/ATender fee: 500.00 SAR Closes: Jun 8, 2010Contact: www.swcc.gov.sa

OVERHAUL OF THE TURBINE AND GENERATOR IN AL KHOBAR SUBSTATIONIssuer: Saline Water Conversion CorporationTender no: KH/5314Title: Overhaul of the Turbine and Generator in Al Khobar SubstationDescription: The scope of work includes the overhaul of the turbine and generator in Al Khobar Substation.Bond: N/ATender fee: 500.00 SARCloses: Jun 9, 2010Contact: www.swcc.gov.sa

REPLACEMENT OF 153.5-MVA TRANSFORMERS AT JUBAIL-2 PLANTSIssuer: Saline Water Conversion CorporationTender no: JB/R/E/317Title: Replacement of 153.5-MVA Transformers at Jubail-2 PlantsDescription: The scope of work includes replacement of 153.5-MVA transformers at Jubail-2 Plants.Bond: N/ATender fee: 500.00 SAR Closes: Jun 16, 2010Contact: www.swcc.gov.sa

REPLACEMENT OF 169-MVA TRANSFORMER AT JUBAIL-2 PLANTIssuer: Saline Water Conversion CorporationTender no: JB/R/E/301Title: Replacement of 169-MVA Transformer at Jubail-2 PlantDescription: The scope of work includes replacement of 169-MVA transformer for Unit No.61 & 62 at Jubail-2 PlantBond: N/ATender fee: 500.00 SAR Closes: Jun 19, 2010Contact: www.swcc.gov.sa

LIVE LINE WASHING OF OHTL INSULATORS AND OUTDOOR GANTRY INSULATORSIssuer: Central Tenders CommitteeTender no: MEW/113/2009/2010Title: Live Line Washing of OHTL Insulators and Outdoor Gantry InsulatorsDescription: The scope of work includes live line washing of 400, 300, 132 and 33-kv Over-Head Transmission Line (OHTL) insulators and outdoor gantry insulators.Bond: ApplicableTender fee: 2500.00 KWD Closes: Jun 20, 2010Contact: Central Tenders Committee - Ministry of Electricity and Water

SNAPSHOT: OMAN


Meeting Oman's power driveAbhay Bhargava and Amritap Ghosh from Frost & Sullivan’s Energy & Power Systems team provide a snapshot of the power sector in Oman

SECTOR OVERVIEWThe Oman electricity and water sector has undergone extensive restructuring since 2004, when the so-called “Sector Law’ paved the way for further privatisation of the market, and led to the establish-ment of an independent regulator.

Power and water plants are typi-cally privately owned, with the pro-vision that a 35 percent share of the project is fl oated on the stock exchange after four years.

The program has allowed the government to successfully set up fi ve power projects generat-ing almost 2.400mw of power and about 360 million litres of water a day. Oman is in the process of launching three more power proj-ects to add additional capacity of 2.000mw and 270 million litres a day.

the main transmission voltage, and use 132kV for sub-transmission. Transmission at 400kV for long dis-tance bulk power is also being con-sidered.

Plans are in place to privatise up to 65% of the transmission and

distribution sector currently owned by the government

body Transco.OETC wants to

increase the number of 220/132kV grid

stations before the summer peak of

2013, while 132/33kV grid station capacity is expected to increase by 14 percent in the same period.

OETC is introducing direct volt-age transformation on the transmis-sion system from 220kV to 33kV, and from 132kV to 11kV in the next fi ve years.

The OETC is also planning to complete a 220kV double circuit ring around northern Oman by the end of 2014.

Oman has the smallest market for industrial transformers up to 30 MVA in the GCC. There are two domestic suppliers in Oman: Vol-tamp Transformers and Al Jizzi Transformers.

Transformers above 10 MVA are currently being imported by Indian and European supplier.

TRANSMISSIONTo accommodate an estimated annual growth in system demand of almost 12 percent between 2009 and 2013, a total of 64 transmission proj-ects are planned over a three year period. The Oman Electricity and Trans-mission Company (OETC) is active in extending the 220kV transmis-sion system to lessen the risk of overload and reduce power losses. The company aims to use 220kV as

5.000mwTotal power generation in Oman in 2009Source: Freshfields Bruckhaus Deringer

Oman's transmission systems will be expanded and upgraded in coming years.

Get

ty Im

ages

Water resource experts agree that aquifer storage and recovery (ASR) and managed aquiferrecharge (MAR) are the best tools to ensure sustainable water supply in arid environments.

Our state-of-the-art technology provides detailed examinations of the subsurface to ensure yourwater is safely contained and accessible for years to come. Rely on our experienced project managers and geo-environmental experts to effectively plan, design, and engineer your ASR system.

Schlumberger Water Services’ experts have successfully implemented ASR in arid environments andunderstand the unique challenges and considersations involved.

Learn about our experience – visit www.slb.com/water/asr

Our Aquifer Storage and Recovery SolutionsMake Sustainable Water a Reality

[email protected]

©Schlumberger

Sustainable Water is Not a Mirage

utilities middle east - may 2010

Documents

middle east water

middle eastrenewables

middle east agenda

transformer diagnostics

clean energy

cleaner energy

tariffshow feed