Bahrain charts pathway to net-zero future
8 November 2023
The rebranding of state oil and gas holding company Nogaholding to Bapco Energies in May was the first overhaul made by Bahrain in a long, phased campaign to achieve net-zero emissions.
As a country that produces just 200,000 barrels a day (b/d) of oil and is almost solely dependent on its neighbour Saudi Arabia for oil and gas supplies, attaining net-zero emissions might be easier and quicker for Bahrain than for its hydrocarbons-heavy Gulf peers.
Bahrain appears to be aware of this potential and has been focusing its efforts on curating a programme to become net-zero by 2060. It has brought on board advisors such as Boston Consulting Group to devise a strategy to achieve its environmental goals.
Following the launch of the new brand identity, Bapco Energies published emissions-reduction targets in July, in one of the most detailed disclosures by any state energy enterprise in the GCC.
Using 2017 as a baseline year, Bapco Energies has committed to reducing absolute Scope 3 emissions in Bahrain by 30 per cent by 2035, and to reaching net-zero Scope 3 emissions by 2060.
In addition, Bapco Energies lists its Scope 1 and 2 net emissions intensity reduction targets, also using 2017 as a baseline, as 15 per cent by 2025, 25 per cent by 2030, 30 per cent by 2035, 50 per cent by 2040 and 75 per cent by 2050, to eventually reach net zero Scope 1 and 2 emissions by 2060.
Scope 1 and 2 emissions are directly related to the core operations of an energy-producing company. In contrast, Scope 3 refers to emissions for which the company is indirectly responsible – a critical measure in the fight against climate change.
Bapco Energies has made its Scope 1, 2 and 3 emissions targets public as part of a framework it has adopted to link its environmental sustainability efforts to its financing exercises. Standard Chartered Bank will support the financing framework.
Decarbonisation action
Similar to large-scale decarbonisation project investments made by Gulf national oil companies, Bapco Energies has initiated a carbon capture and storage (CCS) project estimated to be worth about $4bn, according to its CEO Mark Thomas. The project is expected to be able to sequester 10-12 million tonnes of carbon dioxide a year for at least 50 years.
The scope of the project involves sequestering the carbon dioxide emissions in a large gas reservoir in the Bahrain field, which is also known as the Awali field. The reservoir is big enough to sequester more than 550,000 million tonnes of carbon dioxide, according to Thomas.
The CCS project is bigger than any other project of its kind that has been announced, Thomas claimed in an interview with MEED.
“The good thing is that it is all onshore. Ten to 12 million tonnes of emissions are all within a 7 kilometre radius and the field where it will be stored is 10 kilometres away,” Thomas said.
“I have the space there,” he said. “The challenge is the technology and the cost. This is a very expensive project. We are looking for economies of scale and how we might stage it in a way that makes sense.
“We completed a very early feasibility study last year, in 2022,” he continued.
“We have subsequently engaged with experts in CCS and we expect that [a second] study will be done by mid-2023,” he said, adding that front-end engineering and design work for the project is expected to start before the end of this year.
Sitra refinery upgrade megaproject
Meanwhile, a $4.2bn project by Bahrain Petroleum Company (Bapco) to upgrade the Sitra refinery in Bahrain has made slow progress. The objective of the Bapco Modernisation Programme (BMP) is to boost the processing capacity of the country’s only oil refinery from 267,000 b/d to 380,000 b/d – a strategic target for Bahrain’s long-term downstream potential.
In February 2018, Bapco awarded the $4.2bn contract to perform engineering, procurement and construction (EPC) works to upgrade the Sitra refinery to a consortium led by France’s Technip Energies that includes Spain’s Tecnicas Reunidas and South Korea’s Samsung Engineering.
The project was originally expected to reach mechanical completion in 2023, with operations set to begin in 2024. MEED understands that Bapco will likely miss this commissioning schedule, however.
According to the latest update on EPC progress on the BMP, all of the catalysts required to start operating the newly-installed units have been delivered to the site, although the catalysts still need to be fully loaded into the units.
Upstream objectives
Despite its low oil production capacity, Bahrain is a key member of the Opec+ coalition of oil producers.
Bapco Upstream, the wholly-owned subsidiary of Bapco Energies, is striving to maintain, or even increase, its oil and gas production levels through capital expenditure on key projects.
Bapco Upstream, previously known as Tatweer Petroleum, is the sole operator of the onshore Bahrain field – the first oil field discovered in the Gulf region in 1932. The company produces an average of 42,400 b/d of crude oil and 1.67 billion cubic feet a day of non-associated gas from the Bahrain field.
This represents less than a quarter of the country’s oil output capacity, but is important to Manama as it is the only indigenous oil-producing asset and is key to meeting domestic oil demand.
Bapco Upstream also shares the offshore Abu Safah field, located in the Gulf waters between Bahrain and Saudi Arabia, with Saudi Aramco. Abu Safah contributes about 145,000 b/d to Bahrain’s oil production.
At present, the firm is pushing ahead with a phased field development project to install non-associated gas compressor facilities and remote gas dehydration units to maintain gas deliverability from the Bahrain field. Bapco Upstream is understood to be close to awarding a contract for EPC work on non-associated gas compressor facilities and associated works as part of this project.
Exclusive from Meed
-
Hyundai E&C signs $725m Saudi high voltage deal
13 November 2024
-
Chinese-led consortium wins $262m Algeria rail deal
13 November 2024
-
Hatta hydropower plant heads for trial operation
13 November 2024
-
Bahrain invites independent water prequalifications
13 November 2024
-
Neom replaces CEO
12 November 2024
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends
Related Articles
-
Hyundai E&C signs $725m Saudi high voltage deal
13 November 2024
South Korea’s Hyundai Engineering & Construction (E&C) has won a KRW1tn ($725m) contract to build a high-voltage direct current (HVDC) network project in Saudi Arabia.
The contract forms part of a 1,089-kilometre (km), 500-kilovolt (kV) HVDC transmission line connecting Riyadh Power Plant 14 (PP14) to the Kudmi substation in southwest Saudi Arabia.
Related read: Interconnection vital to GCC energy future
The company signed the contract to build the transmission line's first package, which extends over 369km, with National Grid, the power transmission unit of state utility Saudi Electricity Company (SEC).
The lump sum turnkey project is expected to be completed by January 2027.
Hyundai E&C said the project will utilise a double bipole HVDC system with a power transmission capacity of 4,000MW.
Regarded as a next-generation electricity transmission technology, an HVDC transmission system is ideal for renewable energy such as solar or wind power. It uses direct current for electricity transmission, with voltages between 100kV and 800kV.
An HVDC system is often referred to as a 'power superhighway', transporting significantly more power over greater distances than the common high-voltage alternating current line, and incurs lower power losses.
The South Korean contractor said it has completed 35 transmission line projects in Saudi Arabia in the past 50 years.
Related read: Hitachi Energy rides HVDC boom
https://image.digitalinsightresearch.in/uploads/NewsArticle/12909551/main.jpg -
Chinese-led consortium wins $262m Algeria rail deal
13 November 2024
Algeria’s Anesrif has awarded a $262m construction contract to a consortium led by the China Road & Bridge Corporation (CRBC).
The CRBC-led consortium includes China Civil Engineering Construction Corporation and Algeria’s EPE SNTP.
The contract covers construction work for the Bouchegouf-Souk Ahras-Drea railway section, with a total length of 121 kilometres (km). It is scheduled to be completed in 32 months.
This contract is the latest example of Chinese companies undertaking major projects in Algeria.
MEED reported in January this year that Algeria had selected a team of Beijing-headquartered China Railway Construction Corporation and local contractor Cosider Travaux Publics for a contract to build a 575km railway line.
The line will connect the Gara Djebilet iron ore mine in Western Algeria’s Tindouf Province with the national rail network at Bechar.
The project will facilitate transporting materials from the Gara Djebilet iron ore mine to industrial centres and ports along Algeria’s national rail network.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12908841/main5239.gif -
Hatta hydropower plant heads for trial operation
13 November 2024
Construction work on Dubai’s Hatta pumped-storage hydroelectric power plant is 94.15% complete, and generator installations are under way in preparation for a trial operation in the first quarter of 2025.
According to the state utility, Dubai Electricity & Water Authority (Dewa), the plant’s upper dam, which includes a 72-metre-high main wall and a 37-metre-high side dam, has also been filled.
The plant will have a production capacity of 250MW, a storage capacity of 1,500 megawatt-hours and a lifespan of up to 80 years.
The state utility awarded the contract to build the plant to a consortium of Austrian firms Strabag and Andritz and Turkey’s Ozkar in August 2019.
Dewa said on 12 November that the AED1.421bn ($387m) project is expected to be fully completed by the end of the second quarter of 2025.
The hydroelectric power plant is designed as an energy storage facility with a turnaround efficiency of 78.9%.
It uses the potential energy of water stored in the upper dam, converting it into kinetic energy as the water flows through a 1.2-kilometre subterranean tunnel.
This kinetic energy rotates the turbines, converting mechanical energy into electrical energy, which can be delivered to Dewa’s grid within 90 seconds to meet demand.
To store energy, clean power generated at the Mohammed Bin Rashid Al-Maktoum Solar Park will be used to pump water back to the upper dam, converting electrical power into kinetic energy during the process.
Dewa said the project is part of a comprehensive vision to develop Hatta and enhance its sustainable development, including the creation of job opportunities for Emiratis.
It added that the project “also supports the Dubai Clean Energy Strategy and the Dubai Net Zero Carbon Emissions Strategy 2050”.
Through the project, Dewa aims to diversify energy production from renewable and clean sources in Dubai. These include different available technologies, such as solar photovoltaic panels and concentrated solar power, as well as the use of renewable energy to produce green hydrogen.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12908014/main.jpg -
Bahrain invites independent water prequalifications
13 November 2024
Bahrain’s Electricity & Water Authority (EWA) has invited interested firms to prequalify for a tender to develop the state’s first independent water project (IWP).
The Al-Hidd seawater reverse osmosis (SWRO) plant is expected to have a production capacity of about 60 million imperial gallons a day (MIGD) of potable water.
The client expects firms to submit their statements of qualifications (SOQs) by 18 December.
The facility will be developed on a brownfield site and is expected to be fully operational by the second quarter of 2028. It will help expand Bahrain’s water infrastructure to meet projected demand based on its 2030 master plan.
The Al-Hidd IWP will be developed using a build, own and operate (BOO) model for 20 to 25 years.
EWA has also issued the prequalification request for another BOO project, MEED reported on 11 November.
The Sitra independent water and power project (IWPP) is a combined-cycle gas turbine (CCGT) plant expected to have a production capacity of about 1,200MW of electricity. The project’s SWRO desalination facility will have a production capacity of 30MIGD of potable water.
The plant is Bahrain’s fourth IWPP, replacing the previously planned Al-Dur 3. The Sitra IWPP is expected to be fully operational by the second quarter of 2029.
Sixty representatives from utility developers and contracting firms attended a market-sounding event for the two separate utility BOO projects in Manama on 21 October.
The firms that sent representatives to the event included France’s Engie, Japan’s Mitsui, Saudi Arabia’s Acwa Power, AlJomaih Electricity & Water Company and Ajlan & Bros, and Kuwait’s Gulf Investment Corporation, among others, said sources.
EWA’s transaction advisory team for the two BOO projects comprises KPMG Fakhro as the financial consultant, WSP Parsons Brinckerhoff as the technical consultant and Trowers & Hamlins as the legal consultant.
MEED understands that EWA’s Sitra IWPP will likely be Bahrain’s last CCGT plant project. Solar power is expected to account for all future electricity generation capacity.
Bahrain aims to reach net-zero carbon emissions by 2060.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12907891/main.gif -
Neom replaces CEO
12 November 2024
Register for MEED's 14-day trial access
Nadhmi Al-Nasr has left his role as Neom CEO and will be replaced by Aiman Al-Mudaifer as acting CEO of the company developing the $500bn project in northwestern Saudi Arabia, which includes The Line, Trojena and Oxagon.
In a statement published online, Neom said: “The Neom Board of Directors today announced the appointment of Eng. Aiman Al-Mudaifer as acting CEO of the company. Eng. Al-Mudaifer assumes leadership of Neom, following Nadhmi Al-Nasr’s departure.”
The statement added: “As Neom enters a new phase of delivery, this new leadership will ensure operational continuity, agility and efficiency to match the overall vision and objectives of the project.”
Al-Mudaifer has been head of the Public Investment Fund’s local real estate division since 2018, and the Neom statement says he has a deep and strategic understanding of Neom and its projects.
Neom has attracted significant criticism over the past year as it grapples with major programmes of construction work such as The Line. In a statement announcing the appointment of consultants for work on The Line on 11 November, Neom said it “is currently focused on the initial phases of infrastructure and enabling works for the new city”.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12902059/main.jpg