Related Articles

• 
  Al-Ajban solar IPP reaches financial close

  18 September 2024

  A project company led by French utility developer EDF Renewables and South Korea's Korea Western Power Company (Kowepo), along with Abu Dhabi Future Energy Company (Masdar), have reached financial close on the 1,500MW Al-Ajban solar photovoltaic (PV) independent power project (IPP) in Abu Dhabi.

  According to Masdar, financing for the project has been secured from the following banks and financial institutions:

  • BNP Paribas (France)
  • Credit Agricole (France)
  • Standard Chartered Bank (UK)
  • HSBC Middle East (UK)
  • Sumitomo Mitsui Banking Corporation (SMBC, Japan)
  • Export-Import Bank of Korea (Kexim, South Korea)

  In April, following a successful bid submission, the project company owned by EDF Renewables and Kowepo, which each having a 20% stake as lead members, and Masdar as the local shareholder with a 60% stake, signed a 30-year power-purchase agreement (PPA) with the Emirates Water &.Electricity Company (EWEC).

  The EDF-led team submitted the lowest levelised electricity cost of 5.1921 fils a kilowatt-hour (kWh) or about 1.413 $cents/kWh for the Al Ajban solar PV IPP contract, MEED reported in July 2023.

  The project company will design, finance, build and operate the plant, located some 70 kilometres northeast of Abu Dhabi, the Al-Ajban solar IPP will have a capacity of 1,500MW.

  In July, the developer team awarded Powerchina Huadong Engineering Corporation the engineering, procurement and construction (EPC) contract for the Al-Ajban solar IPP project.

  It is the second major contract the French-South Korean team won in the GCC since March last year. The team previously won the contract to develop and operate Oman's 500MW Manah 1 solar IPP.

  The same EPC contractor, Powerchina Huadong Engineering Corporation, is undertaking the EPC work for the Manah 1 IPP.

  Net-zero goals

  The Al-Ajban project – similar to the 1,584MW Al-Dhafra solar IPP, which was inaugurated in November, and the operational 935MW Noor Abu Dhabi plant – supports the UAE Energy Strategy 2050 and the UAE Net-Zero by 2050 strategic initiative.

  Ewec aims to install up to 17GW of solar PV capacity by 2035.

  The plan will require the procurement of about 1.5GW of capacity annually over the next 10 years. Over the intervening period, ending in 2030, Ewec plans to have an additional 5GW of solar capacity, reaching a total solar installed capacity of 7.3GW by 2030.

  Ewec expects its first battery energy storage system to come online in the late 2020s to boost balancing the grid's load as more renewable energy enters the system.

  The UAE published its updated national energy strategy in July last year. It includes a plan to triple the nationwide renewable energy capacity to 19GW by 2030.

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  Jennifer Aguinaldo
• 
  Aramco spending lifts Saudi upstream market

  16 September 2024

  Saudi Aramco’s profits in the second quarter and first half of 2024 may have slid on a year-on-year basis, but that has not impacted the company’s capital expenditure (capex). Project spending, on the contrary, has spiked sharply.

  Capex rose to $12.13bn in the second quarter from $10.46bn in the same period last year. Second-quarter capex also increased from the first quarter, during which Aramco spent $10.83bn. In the first half of the year, the company’s spending increased to $22.96bn, compared to $19.20bn in the first half of 2023, Aramco said.

  Aramco has demonstrated robust capex so far this year on major projects that are critical to its strategic upstream goals of maintaining oil production potential at 12 million barrels a day (b/d) and raising gas production by 60% by 2030, with 2021 as its baseline.

  Robust offshore spending

  In late January, the Saudi Energy Ministry directed Aramco to abandon its campaign to expand its oil production spare capacity from 12 million b/d to 13 million b/d by 2027. As a direct consequence of that government decision, Aramco cancelled the tendering process for at least 15 tenders involving engineering, procurement, construction and installation (EPCI) of structures at key offshore oil and gas fields.

  Since that decision, however, Aramco has gone the other way. The Saudi energy giant has already spent an estimated $4bn-$4.5bn year-to-date on offshore EPCI contracts, known in the Aramco ecosystem as Contracts Release and Purchase Orders (CRPOs).

  Italian contractor Saipem has been the biggest beneficiary of this robust offshore spending by Aramco, winning all of the CRPOs awarded so far this year.

  In early May, Aramco awarded Saipem the contract for CRPO 143, which involves replacing an oil line between the Berri and Manifa oil fields in the kingdom’s Gulf waters.

  Aramco then awarded Saipem the contract for CRPO 138, which involves laying a trunkline at the Abu Safah offshore field. The contract is estimated to be worth $500m.

  The Milan-listed contractor then scooped three major CRPOs in August, starting with CRPOs 132 and 139, whose combined value is estimated to be about $1bn. The scope of work for the two contracts involves the EPCI of structures to upgrade the Marjan, Zuluf and Safaniya offshore field developments, respectively.

  Just days after awarding CRPOs 132 and 139 to Saipem, Aramco awarded the Italian contractor CRPO 127, worth an estimated $2bn-$2.5bn. It involves EPCI works for several structures at the Marjan field development.

  Offshore jobs under bidding

  Meanwhile, offshore service providers in Aramco’s Long-Term Agreement (LTA) pool of contractors are preparing bids for eight more CRPOs.

  Aramco had issued a fresh batch of four tenders – CRPOs 149, 150, 152 and 153 – which cover the EPCI works on Saudi Arabia’s Abu Safah, Arabiyah, Hasbah and Marjan offshore oil field developments.

  Prior to those four tenders, Aramco issued four other tenders in May to its LTA contractors as part of a project to further expand the Zuluf offshore field development. The main objective of the project is to install several structures at the Zuluf field to maintain and raise its long-term oil and gas production potential. The combined value of CRPOs 145, 146, 147 and 148 is estimated to be about $4bn. LTA contractors were initially due to submit bids for the four tenders by 22 August, but Aramco eventually extended the deadline until 17 October.

  Prioritising gas production

  Saudi Aramco has registered swift progress this year with the successive expansion phases of its programme to produce and process gas from the Jafurah unconventional development in Saudi Arabia.

  Aramco officially awarded contracts on 30 June for the Jafurah second expansion phase, which aims to raise its processing potential to up to 2 billion cubic feet a day (cf/d) of raw gas produced from the Jafurah field.

  Aramco awarded 16 contracts worth about $12.4bn for EPC works and drilling services for the second expansion phase.

  Within weeks of those awards, a consortium of Spanish contractor Tecnicas Reunidas and China’s Sinopec Group announced that Aramco had selected it for EPC works on the third expansion phase, worth $2.24bn. The EPC scope of work mainly entails building three gas compression plants, each capable of processing 200 million cf/d.

  Also in July, Aramco issued the main EPC tender for the fourth expansion phase. Contractors are preparing bids for the project, whose scope of work is similar to that of the third expansion phase and is, hence, understood to be of similar value.

  Aramco said last year that it expected its total capex in 2024 to be in the range of $48bn to $58bn. As the first eight months of the year have demonstrated, far from witnessing a slump in capex, 2024 may well turn out to be a record year for Aramco’s project spending.

  Looking beyond 2024, Amin Nasser, Aramco’s president and CEO, told MEED in May that he expects his company to ramp up capex in the next two years as it strives to achieve its strategic 2030 goals. This capex guidance indicates that Aramco’s spending boom on oil production and gas production capacity expansion projects could extend into 2026.

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  Indrajit Sen
• 
  Taqa rebrands operating companies

  16 September 2024

  Energy and utility developer and investor Abu Dhabi National Energy Company (Taqa) has rebranded several companies operating under its umbrella.

  According to Taqa, Abu Dhabi Distribution Company (ADDC) and Al-Ain Distribution Company (AADC) will be brought under a single new brand and will operate as a single entity serving customers throughout the emirate of Abu Dhabi. The new brand will be called Taqa Distribution.

  It said the move “brings scale to Taqa’s customer-facing business and will enable it to further develop its customer services, develop new products and services and to seek opportunities for further growth in the UAE and internationally”.

  The company added that Taqa Distribution is expected to play a key role in Taqa’s ambition to champion low-carbon power and water and strengthen its operational efficiency.

  Taqa will also rebrand three wholly-owned operating companies.

  Abu Dhabi Transmission & Despatch Company (Transco) will become Taqa Transmission, leading the operation and development of Taqa’s domestic and international power and water transmission infrastructure.

  Sustainable Water Solutions Holdings (SWS Holdings) will be rebranded as Taqa Water Solutions, leading the operation of Taqa’s wastewater treatment facilities and the production of recycled water in Abu Dhabi. SWS was previously Abu Dhabi Sewerage Services Company.

  Abu Dhabi Energy Services (Ades) will become Taqa Energy Services, facilitating demand optimisation and providing tailored energy management solutions.

  Taqa's activities cover the entire utility value chain, including generation, transmission, distribution, water solutions and energy services.

  Established in 2005, Abu Dhabi-listed Taqa maintains and operates utility assets in Canada, Ghana, India, Morocco, Oman, the Netherlands, Saudi Arabia, the UK, the US and the UAE.

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  Jennifer Aguinaldo
• 
  One bid for Jubail 4 & 6 IWP scheme

  16 September 2024

  One consortium has submitted a proposal for a contract to develop an independent water project (IWP) in Jubail in Saudi Arabia’s Eastern Province.

  The contract covers developing and operating two water desalination plants – Jubail 4 and Jubail 6 – with a total combined capacity of 600,000 cubic metres a day (cm/d) using reverse osmosis technology.

  According to state water offtaker Saudi Water Partnership Company (SWPC), the sole bidder is a team comprising Saudi-headquartered companies Acwa Power, Haji Abdullah Alireza & Company (Haaco) and AlSharif Contracting & Commercial Development.

  MEED previously reported that at least two consortiums were expected to submit bids for the contract.

  The state water offtaker requested proposals for the Jubail 4 & 6 IWP in January this year, four months after it qualified nine individual companies and consortiums to bid for the contract.

  The following utility developers and investors were qualified to bid for the contract: 

  • Abu Dhabi National Energy Company (Taqa)
  • Acciona (Spain)
  • Acwa Power (local)
  • Ajlan & Bros (local) / Rawafid Industrial Company (local)
  • Al-Jomaih Energy Water Company (local) / Sogex Oman Company (local) 
  • GS Inima (Spain/South Korea)
  • International Power (Engie, France)
  • Marubeni Corporation (Japan)
  • Power & Water Utility Company for Jubail & Yanbu (Marafiq, local)

  The desalination plants will be located 18 kilometres south of Jubail Industrial City, adjacent to four existing desalination units – Jubail phase one, Jubail phase two, and the Jubail 3A and 3B IWP facilities.

  As with the previous seawater reverse osmosis (SWRO) IWP contracts awarded in the kingdom, the successful bidder, through a project company, will develop the project and sell the entire capacity and output to SWPC under a 25-year water-purchase agreement (WPA).

  A credit support agreement from the government of Saudi Arabia backs SWPC’s obligations under the WPA.

  SWPC’s transaction advisory team for the project comprises Netherlands-headquartered KPMG Professional Services as lead and financial adviser, UK-based Eversheds Sutherland as legal adviser and Canada’s WSP as technical adviser.

  It also appointed UAE-based Future Water & Power Consulting to assist with the project tender and with finalising the site studies required for the bid.

  Recent IWPs

  SWPC has so far awarded the contracts for six IWP projects: Rabigh 3, Shuqaiq 3, Yanbu 4 (Ar-Rayis 1), Jubail 3A, Jubail 3B and Rabigh 4. A seventh contract for developing the Shuaibah 3 SWRO plan was also directly negotiated and awarded in 2022.

  The seven IWP schemes have a total combined capacity of 3.3 million cm/d.

  SWPC received two bids in April for a contract to develop the 300,000 cm/d Ras Mohaisen IWP scheme.

  The bidders were Spain’s Acciona and a team comprising the local firms Acwa Power, Haaco and AlKifah Holding.

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  Jennifer Aguinaldo
• 
  Abu Dhabi extends 1.5GW Al-Khazna bid deadline

  16 September 2024

  Abu Dhabi state utility Emirates Water & Electricity Company (Ewec) has extended the bid deadline for a contract to develop Abu Dhabi's fourth utility-scale solar photovoltaic (PV) project.

  The planned Khazna solar independent power project (IPP), also known as PV4, will have a capacity of 1,500MW.

  It will be located in Khazna, between Abu Dhabi and Al-Ain, and is expected to reach commercial operation by 2027.

  Ewec requested proposals for the contract to develop and operate the solar IPP scheme in April and initially set the end of August as the last day for bidders to submit their proposals.

  MEED understands the revised tender closing date is 3 October.

  The state utility prequalified nine companies and consortiums as managing members and another 10 that can bid as consortium members.

  Parties or companies prequalified as managing members are free to bid individually or as part of a consortium. These include:

  • Acwa Power (Saudi Arabia)
  • EDF Renewables (France)
  • International Power (Engie, France)
  • Jera Company (Japan)
  • Jinko Power (China)
  • Korea Electric Power Corporation (Kowepo, South Korea)
  • Marubeni Corporation (Japan)
  • Sumitomo Corporation (Japan)
  • TotalEnergies Renewables (France)

  The following companies can bid as part of a consortium with a managing member: 

  • Al-Jomaih Energy & Water (Jenwa, Saudi Arabia)
  • Avaada Energy (India)
  • Buhur for Investment Company (Saudi Arabia)
  • China Machinery Engineering Corporation (China)
  • China Power Engineering Consulting Group International Engineering Corporation (CPECC, China)
  • Kalyon Enerji Yatrimlari (Turkiye)
  • Korea Western Power Company (Kowepo, South Korea)
  • Orascom Construction (Egypt)
  • PowerChina International Group
  • SPIC Huanghe Hydropower Development (Spic, China)

  A transaction advisory team comprising US-headquartered Ashurst and Alderbrook Finance and Norwegian engineering services firm DNV is advising Ewec on the 1.5GW Al-Khazna IPP scheme.

  Solar energy is integral to achieving Abu Dhabi's target of producing nearly 50% of its electricity from renewable and clean energy sources by 2030.

  In April, Ewec awarded the contract to develop PV3, the 1,500MW Al-Ajban solar IPP, to a team led by French utility developer EDF Renewables and including South Korea's Korea Western Power Company (Kowepo).

  Like the first three schemes, the Khazna solar PV will involve the development, financing, construction, operation, maintenance and ownership of the plant and associated infrastructure.

  The successful developer or developer consortium will own up to 40% of the entity, while the Abu Dhabi government will retain the remaining equity.

  The developer will enter into a long-term power-purchase agreement with Ewec.

  Once fully operational, the Khazna solar PV, along with Noor Abu Dhabi, the Al-Dhafra solar PV and Al-Ajban solar PV, will raise Ewec's total installed solar PV capacity to 5.5GW and collectively reduce CO2 emissions by more than 8.2 million metric tonnes a year by 2027. 

  https://image.digitalinsightresearch.in/uploads/NewsArticle/12537771/main.jpg

  Jennifer Aguinaldo