$7b power grid project on track

Sep 11, 2007 - Issac John - Khaleej Times Online

DUBAI - The first phase of the $7 billion Gulf Cooperation Council (GCC) power grid will be commissioned by the first quarter of 2009.

More than 30 per cent of the construction in the $1.1 billion first phase, which will link Saudi Arabia to Bahrain, Kuwait and Qatar through 800 kilometres of transmission lines, was completed at the end of June. According to the GCC lnterconnection Authority (GCCIA), given the rapid pace of work on the project, the first phase would be completed by the end 2008 and it is expected to go into operation in the first quarter of 2009.

The second phase will link the UAE with Oman. The resulting two mega grids will be joined in the final phase. Once the grid is ready, Kuwait and Saudi Arabia will each receive an extra 1200 MW of power capacity, the UAE will receive 900 MW, Qatar 750 MW, Bahrain 600 MW and Oman 450 MW.

The GCC power-grid, which will link the six-member GCC with an integrated electricity network, aims to reduce the cost of power generation in the six GCC states.

The Dammam-based GCCIA— which was established in 2001 as a joint stock company with authorised share capital of $1.1 billion to implement the interconnection project — said in the first stage of the three-phased grid, an 800-km 400-kV overhead line will link Kuwait's Al Zour power station with Doha, and a 400-kV submarine line will link Saudi Arabia with Bahrain.

A study is currently being conducted with a view to connecting Saudi Arabia to Egypt, paving the way for a pan-Arab grid. The main objective of the GCC power grid is to ensure an emergency power supply during the shortage of electricity in any of the six GCC countries.

Work on the project started in September 2005 and the whole project is expected to be completed by 2010. "Until recently, it seemed as if the 2010 target was out of reach because of a lack of progress in several areas.

Over the last two years a string of new contracts have been awarded that indicate a new level of determination to complete the grid," an industry analyst said.

If the entire project is to be completed on schedule by 2010, it is estimated that total investment cost would be about $7 billion, although much of this will be spent on improving internal, domestic power infrastructure. The GCC countries, riding an economic boom spurred by record oil revenues and population growth, have committed to invest $100 billion to generate 100,000 MW of additional power over the next 10 years to meet demand.

Adnan I. AI Mohaisen, Chief Executive Officer, GCCIA, in an interview with the Saudi Commerce & Economic Review, said that the first phase at the project would be completed by the end 2008 and it is expected to go into operation by the first quarter at 2009.

The project has been divided into several work packages: substations, back-to-back HVDC (high voltage direct current) converter station, submarine cable, overhead transmission line and the Interconnection Central Centre. He pointed out that after the completion of the interconnection project, which potentially can be linked to other international grids such as EJILST (Egypt, Jordan, lraq, Lebanon, Syria and Turkey) and UTCE of Europe for energy interchange, the GCC can emerge as a major regional power trading market.

According to AI Mohaisen, the most important feature of the project is the use of a submarine cable, which will connect Saudi Arabia to Bahrain. Although it is costlier to install the submerged cable than constructing a transmission line, it has been found necessary due to Bahrain being an island and lacking land access to connect it through overhead lines. He said the installation of the submarine cable would represent nearly one-third of the total cost of the interconnection project. The project will also have the Middle East's first HVDC station. The 1,800 MW station is necessary to convert the frequency between Saudi Arabia's transmission grid and the grids at other GCC countries.

The GCC power grid will be eventually linked to the Dh2 billion UAE national power grid, the second phase of which was inaugurated recently. Electricity network in Sharjah was inter-connected with its peers in Abu Dhabi and Dubai. The UAE power grid, which will enable power authorities in each emirate to use or exchange the reserve power capacity in case of emergency, will also reduce operations costs and allow easy link of the UAE to the GCC power grid.

Construction work on the first phase has been progressing smoothly, although contractors of the projects have been facing difficulties due to steep rise in aluminium price. He pointed out that the prices at aluminium have more than doubled since the contracts were awarded in 2005.

AI Mohaisen said a major problem facing the project in the installation of power transmission lines. "We are encountered with numerous oil and gas pipelines and pipelines of other utilities in the way of laying our transmission cables, which have been hampering our work," he said.