Meed | Egypt and Italy hold final $3.5bn grid talks

Egypt and Italy hold final $3.5bn grid talks

17 February 2023

Egypt and Italy could sign an agreement worth an estimated $3.5bn to link their electricity grids in June, according to a local media report.

This follows several rounds of talks on the $3.5bn project, Arabic-language daily Addustoor said.

MEED understands the two countries are still discussing the project, which involves the installation of 2,200 kilometres of power lines through a third country.

Italy has secured funds from local and European sources for its part of the project, Addustoor said, citing a source.

Greece could be the third country being referred to.

US engineering firm McDermott signed a memorandum of understanding (MoU) with Athens-based Eunice Energy Group for a 2GW electricity interconnection project between Egypt and Greece, as MEED reported earlier this month.

Eunice Energy leads the consortium known as Greece-Africa Power (GAP), which is developing the project.

McDermott is expected to provide "engineering and construction guidance for the project", the company said on 31 January.

In October 2021, Egypt signed separate power interconnection agreements with Greece and Cyprus.

The agreements were expected to pave the way for implementing an Eastern Mediterranean energy corridor.

The planned interconnector aims to enable the exchange of 2,000MW-3,000MW of electricity between Egypt, Cyprus and Greece, and potentially with other European countries, as MEED reported.

The agreement with Greece entails setting set up an undersea cable network that will transmit renewable energy produced from North Africa to Europe.

Greek Energy Minister Kostas Skrekas and his Egyptian counterpart, Mohamed Shaker, signed an MoU for the project at a ceremony in Athens on 14 October 2021.

The project will help build an Eastern Mediterranean energy corridor and improve the security of energy supply in the region, Skrekas said at the time.

An electricity grid linking Egypt and the GCC states is under way. Egypt and Saudi Arabia awarded substation, subsea and overhead transmission contracts for the $1.8bn interconnector linking the GCC states and North Africa in October 2021.