ADWEA inks $2.8bn plant deal

Abu Dhabi has awarded a contract to build a $2.8bn power and water desalination plant to the UK’s International Power (IP) and Japan’s Marubeni. The Fujairah 2 plant will produce 2000 MW of power and around 130m gallons (49m litres) per day of water and is expected to start up in 2010, IP said in a statement.

IP and Marubeni signed a 20-year deal to operate the plant jointly and supply all the power and water to Abu Dhabi Water and Electricity the Authority (ADWEA). IP’s equity investment in the project will be $112m, the company said.

The project funding will be 80 per cent debt and 20 per cent equity. The plant will be 60 per cent owned by ADWEA and Abu Dhabi National Energy. IP and Marubeni will each own 20 per cent stakes.

ADWEA forecasts that it requires around 1500-2000 MW of new capacity per year over the next 15 years to meet rapidly growing demand from a petrodollar-fuelled economic boom. Abu Dhabi’s power generation capacity will edge up to 8367 MW by the end of 2007.

Kazatomprom snaps up ten per cent of Westinghouse

Toshiba and Kazatomprom, a major uranium supplier based Kazakhstan, have signed a share-transfer agreement, under which Kazatomprom will become an indirect minority shareholder in Westinghouse Electric Company LLC.

Toshiba will transfer ten per cent ownership of Westinghouse’s holding companies to Kazatomprom at a price of $540m.

Toshiba will continue to control Westinghouse, owning 67 per cent of Westinghouse through holding companies in the USA and the UK. The Japanese company said that the alliance of Toshiba, Kazatomprom and Westinghouse will contribute not only to the promotion of collaboration in the nuclear energy area among the three countries, but also to the expansion of nuclear power generation on a global basis to combat global warming.

Egypt’s new energy pricing policy to cut subsidy costs

Egypt is to introduce a new pricing policy to phase out gas and electricity subsidies for energy intensive industries as the government seeks to create pricing predictability for investors and ensure its energy resources are effectively used.

Energy subsidies are a huge burden on the treasury, which could save more than 30bn Egyptian pounds (US$5.3bn) over the next five years after the introduction of the policy, said Rachid Mohamed Rachid, the trade and industry minister.

The new pricing formula – the country’s first of its kind – will initially affect 40 companies in sectors such as steel and cement.

Turkey cancels power plant tender with CEZ as sole bidder

Turkish state-run energy company EUAS has cancelled a tender to build a power station, in which Czech power producer CEZ was the only bidder.

CEZ failed to meet all conditions of the tender to build a power station with output of at least 1200 MW, but it has not lost interest in the Turkish market.

“Just like throughout Europe… power consumption in Turkey is growing enormously, and so is demand for power. The current resources can hardly cover the demand and it is necessary to build new ones,” CEZ chief executive Martin Roman said.

UAE could force generators to buy renewable energy

Abu Dhabi’s energy regulator the Regulation & Supervision Bureau is considering compelling power generation companies to buy renewable energy.

The move is part of a wider plan to encourage private sector involvement in the renewable energy sector, which includes a proposal to introduce one of the Gulf’s first carbon credit trading systems. It is also working with Masdar, the alternative energy initiative run by the Abu Dhabi Future Energy Company (Adfec), on developing policy guidelines for the emerging sector.

Iran & Turkey sign agreement on electricity

The Iranian and Turkish energy ministers have signed a cooperation agreement to increase export of Iran’s electric power to Turkey and exchange electricity between the two neighbouring countries.

Following preliminary talks in Turkey, which resulted in the signing of a first agreement, the second round of talks took place last month in Tehran, which resulted in the signing of the second agreement.

Iran’s energy minister Parviz Fatah said, “With the signing of the second agreement we are now closer to the implementation stage.”

According to the agreement, Iran’s export of electricity to Turkey will turn into the exchange of electric power between the two countries given such factors as peak hours and demand of each country.

He said that because the peak hours for Iran and Turkey differ an appropriate opportunity has been provided for exchange of energy between the two countries.

Fattah added Iran could exchange electricity with Turkey just like Armenia and Azarbaijan.

Algeria: A consortium of Alstom and Egypt’s Orascom are the only bidders for the Koudiet Edraouch and Terga electric power plants, which make up a total capacity of 1200 MW. A sum of $1.84bn has been allocated for Terga and $1.98bn for Koudiet Edraouch.

Algeria: Areva’s Transmission and Distribution (T&D) division has signed a g50 m($68m) deal with Sonelgaz, to increase the capacity of its transmission grid via a 400 kV air-insulated substation. The work is part of the Mediterranean grid project that will link the power grids of the Maghreb and European countries.

Armenia: A Russian-Armenian group is to build a 1000 MW, $2bn nuclear power station to replace the country’s aging Metsamor plant, slated for closure in 2016.

Bahrain: Power output in the Kingdom is set to double by 2020, according to minister of electricity and water Shaikh Abdullah bin Salman Al Khalifa. The number of transformers in Bahrain will increase at the rate of 40 a month until 2020.

Iraq: Turkey’s energy ministry has said that it has signed an agreement with Iraq to allow Turkish firms to construct a new power plant in Iraq to help overcome electricity shortages. However, the ministry pointed out that no details had been agreed on the size of the plant or on where it would be built.

Oman: Demand for electricity in Oman is expected to increase by 300 MW annually until 2013. Power supplied to the main grid was 2544 MW in 2006 and is expected to increase to 4634 MW by 2013.

Somalia: Somalia has urged Russia to join the development of its hydrocarbon resources and has offered Moscow exclusive uranium shipments. Somalia’s draft law on the utilization of subsurface mineral resources is set to ease operations by foreign companies considerably.

Qatar: ABB has won a contract worth $140m from Qatalum to build the world’s largest aluminium smelter in Qatar. ABB will supply a high-voltage power rectifier station as well as high-voltage cabling.

Saudi Arabia: Saudi Electricity Company (SEC) has awarded an SR383m ($120m) contract to South Korean giant Hyundai Engineering and Construction to build 202 km of 380 kV power transmission lines in the eastern region by autumn 2009.

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