News digest

Czech Republic: The Czech government has approved an amendment to the energy law aimed at increasing competition and strengthening consumer choice. The move is in response to EU directives that state that markets should be fully liberalized by mid-2007.

Jordan: The National Electric Power Company (NEPCO) of Jordan has awarded VA Tech Transmission & Distribution a g23m ($28m) contract for a new 400 kV GIS substation in Samra, Jordan. The substation will be commissioned in 2005.

Kazakhstan: Areva and Kazatomprom have launched the second phase of a joint uranium production project in Kazakhstan. The two companies have for three years been operating a pilot uranium production plant in southern Kazakhstan, and will now work on the detailed engineering and construction of a facility that will eventually produce 1500 t/year.

Kazakhstan: The European Bank for Reconstruction and Development (EBRD) has granted a $60m loan to the Kazakhstan Electricity Grid Operating Company (KEGOC) to support the construction of the $90m North-South transmission line. The funds will be used to finance a 250 km stretch of the line running from the Yuk-GRES substation to the Shu substation.

Oman: Dhofar Power Company SAOC and Dhofar Generating Company SAOC have awarded Wood Group Heavy Industrial Turbines Ltd a $12m long-term contract to provide maintenance service support for gas turbines and associated equipment. The contract includes the supply of spare parts, component repair and onsite services for six GE Frame 6B gas turbines at the new 242 MW Salalah power station in southern Oman.

Saudi Arabia: The Saudi Arabian Mining Company (Ma’aden) is accepting tenders to a $1000m, 1500 MW baseload power plant at its aluminium refinery and smelter at Az Zabirah in the Central Northern region. The contract is expected to be awarded in 2004. The plant is scheduled for start up by t2006.

Turkey: German power plant developer Steag has sold a 24 per cent stake in the Iskenderun power plant in Turkey to Oyak, Turkey’s largest private pension fund. Steag remains the majority shareholder in the plant with 51 per cent, while RWE Power AG owns 25 per cent. The 1200 MW hard coal fired plant entered operation in late 2003.

UAE: The United Arab Emirates’ ministry of electricity and water has awarded Areva Transmission and Distribution a g70m ($84m) contract for the design and installation of a new high voltage substation in Dhaid.

Russia approves TGK structure

Russia’s Unified Energy Systems (UES) has approved the structure of the territorial generation companies (TGKs) which will be created under the country’s electricity sector reform plans. The move is a key step forward in the restructuring process, which had appeared to falter in the last few months.

The TGKs will be created by merging the assets of 58 regional electricity companies (energos) into 14 new generation companies split along regional lines.

The board of UES agreed to form the TGKs by the co-creation method, which involves two steps. The TGKs will first be established as legal entities and will lease the generation assets of the energos. The energos will then fully divest their assets to the TGKs.

The largest TGK will be that formed from the assets of Moscow’s Mosenergo. It will have an installed capacity of around 10 000 MW, comparable in size to the wholesale generation companies which will be created during the restructuring process.

The co-creation method is thought to be the most effective way of transferring UES-owned assets into private hands. UES is 52 per cent owned by the government and hold majority or near-majority stakes in most of Russia’s energos.

Ukraine to build world’s largest coal mine gas to power project

GE Jenbacher has received a multi-million dollar contract to provide 22 complete gas engine cogeneration systems for a coal mine gas-to-energy project in Ukraine. The contract was awarded by the Lease-Holding Company Coal Mine Named After A. F. Sasyadko, located in Donezk, southeastern Ukraine.

Gas from coal mines will be used to power 22 GE Jenbacher JMS 620 GS-S.LC cogeneration systems, generating a total of 131 MW. The plant will be the largest of its kind in the world, and will support operations at three Sasyadko sites around Donezk. It is expected to enter operation in late 2004. The power plant will serve as a reference plant in the region, according to GE Jenbacher. It will prevent the release of methane – a powerful greenhouse gas – to the atmosphere. Total greenhouse gas emission reductions achieved by the site will equate to 2.3-2.7m t of carbon dioxide per year.

E.ON plans Hungarian investment

German utility company E.ON is to invest g250m ($300m) in its Hungarian subsidiary, E.ON Hungary. The investment will be used to expand and upgrade the low voltage grid of the company’s three power supply firms in the country.

E.ON Hungary controls three of Hungary’s six electricity distribution companies – Dedasz, Edasz and Titasz – and controls some 46 per cent of the country’s power market. It has invested more than g1bn since its entry into the Hungarian market in 1996.

E.ON will reinforce its network by building new transformer stations and upgrading outdated network equipment. The work would be complete by 2006 and will help the three power distributors deal with an increase in demand expected as a result of the second phase of market opening in July 2004.

GCC approves grid funding

Electricity and energy ministers of the Gulf Cooperation Council (GCC) have approved funding for a plan to link their power grids. Execution of the $6bn project will begin soon, according to the Kuwaiti energy minister Shaikh Ahmad Fahd Al Sabah.

The first phase of the project involves linking the grids of Kuwait, Saudi Arabia, Bahrain and Qatar, and will cost $2.25bn. Saudi Arabia will contribute 40 per cent of this cost, Kuwait 36.5 per cent, Qatar 13.5 per cent and Bahrain ten per cent.

The second phase of the project involves linking the grids of Oman and the United Arab Emirates. In May, the government of the UAE signed a number of contracts for its national power grid project, which will enable the country’s grid to link up with the GCC power grid.

The GCC power grid project is seen as a key step in integrating the infrastructure of countries in the region. A key benefit will be the ability of GCC nations to reduce the amount of capital investment in the electricity sector.

The UAE’s Dh814m ($222m) national power grid project will be implemented over a two-year period, and will establish a single national power network for the whole country.

Libya invests

The General Electric Company of Libya (GECOL) has awarded cable company Nexans a g100m ($120m) contract to provide high voltage underground power transmission links to Tripoli and Benghazi.

The links will connect electricity substations to the Suk el Juma, Ainzarra and National districts of Tripoli and the North and Central districts of Benghazi. They will increase the power transmission capabilities of these two cities, where electricity demand is growing rapidly.

The project is being financed entirely by Libya and is scheduled for completion within a 30 month period.