Completing infrastructure ahead of time
10 December 2024
In late December 2023, Bahrain opened the Al-Fateh Highway project to traffic five months ahead of schedule. The highway connects key areas in Bahrain, including Manama, Mina Salman, Sitra, Muharraq, Bahrain Bay and Juffair, and opening the scheme promptly has significantly improved traffic in one of the most congested areas of the country.
“The secret to success was implementing the project in stages, combined with excellent traffic management,” says Minister of Works Ibrahim Bin Hassan Al-Hawaj.
The successful completion of the Al-Fateh Highway project comes at an important time for Bahrain, as it continues to upgrade its road network.
“The lessons we learned from Al-Fateh Highway are being utilised on other projects. We are working on the Muharraq Ring Road project, and that is also going to be open for traffic well ahead of time,” says Al-Hawaj.
Like Al-Fateh Highway, the Muharraq Ring Road project connects key commercial and residential areas in Bahrain, including North Muharraq, Diyar Al-Muharraq and Dilmunia.
Multifaceted approach
These projects are part of Bahrain’s comprehensive approach to alleviating road traffic.
“In 2016, we launched a study that identified projects that could help ease congestion. It proposed a multifaceted approach that covers many things, including public transport and an intelligent transport system, which introduces automation,” explains Al-Hawaj.
“We have not implemented everything in the study, but we are working through it gradually with the Traffic Council, headed by his excellency the minister of interior, and including the Ministry of Works, Ministry of Transportation and Ministry of Housing & Urban Planning. We have regular meetings to identify challenges and then put forward suitable projects to solve them,” says Al-Hawaj.
The Ministry of Works is responsible for maintaining, improving and expanding the road network. Its projects are split into four categories.
The first two categories are the major projects. The first is building new roads, while the second is improving the existing road network, either by widening roads or upgrading intersections.
Then there are the other two categories. These are maintaining the existing road network – which is a challenging task with existing traffic – and a fourth category that is known as ‘quick wins’. These small, tactical-level projects can be completed quickly to ease specific traffic black spots.
“We have about 60 projects under implementation, valued at BD172m ($456.2m), and among these are 14 strategic projects that amount to BD117m,” says Al-Hawaj.
Upcoming schemes
The pipeline of projects under execution will soon be expanded with the addition of a fourth crossing connecting Busaiteen with Bahrain Bay. The Bahrain Tender Board opened prices for the contract to build the signature bridge crossing in late November.
“The fourth crossing project is going to start in 2025,” says Al-Hawaj.
Looking further ahead, more road contracts will be awarded. “There are more than BD200m of future projects approved, and they will go to tender in the coming two years,” says Al-Hawaj.
There are more than BD200m of future projects approved, and they will go to tender in the coming two years
One of the roads that suffers from high traffic volumes is Sheikh Jaber Ahmed Al-Sabah Highway, from Umm Al-Hassam to the Alba intersection.
“This is our biggest project in the future. There will be four lanes in each direction, and all the intersections will be free-flowing traffic either by underpass or flyovers. We will get rid of all the traffic lights,” says Al-Hawaj.
The project will move into the construction phase next year with preparation works.
“One of the main lessons from the Al-Fateh Highway project is to free the construction zone from any services before construction starts. It will take some time to redirect the existing utilities, and then we will immediately go into construction,” says Al-Hawaj.
Another upcoming major scheme is the Bahrain Northern Link Road (BNLR) project that will run along the northern coast of Manama from the Bahrain Bay area in the east to Madinat Salman in the west. Initial estimates suggest that the scheme, which will have sections onshore and offshore, could cost BD500m to deliver.
Together with the fourth crossing project and the Northern Muharraq Ring Road, the BNLR scheme will create a new road corridor along the northern edge of Bahrain.
Unlike other road projects in Bahrain, the BNLR will be delivered as a public-private partnership project. Dar Al-Handasah was selected for the project’s feasibility study in 2022.
Away from roads, another major area of responsibility for the Ministry of Works is sanitation. At present, 86% of premises in Bahrain are connected to the sanitation network and sewage treatment plants (STPs), and there are plans to connect the remaining 14%.
STP capacity is also increasing. The capacity of Bahrain’s largest plant at Tubli is being doubled, and there is an expansion under way for the STP at Muharraq. The Sitra STP is also being upgraded, using technology from UK company Bluewater, which allows for capacity to increase without adding to the footprint of the site.
A greenfield project is also planned. “We have a new plant coming soon at Khalifa City,” says Al-Hawaj.
“We are finalising the drawings, and a tender is expected to be issued in the first quarter of 2025. We will start with 20,000 cubic metres a day, but the ultimate capacity will be 40,000 cubic metres a day.”
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The financing package consists of a sovereign-guaranteed EBRD loan of up to $56.5m and an EU investment grant of up to €12.4m.
These funds will finance the construction of a new high-voltage electricity substation in northern Jordan to improve the grid’s capacity, enabling it to handle existing and new generation in the north of the country, said EBRD
The new substation will not only improve the grid’s ability to handle additional generation capacity, but also facilitate cross-border interconnections, as well as reduce transmission losses by optimising power flows across the national grid.
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These projects support Jordan's ambitious renewable energy targets for 2030.
The financing will be complemented by a comprehensive technical cooperation package. An EU-funded technical cooperation grant of €2.2m will also be provided to appoint a project implementation consultant for Nepco.
Nepco is the owner and operator of Jordan’s transmission system, as well as the single buyer of electricity.
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Saudi Arabia capacity buildout enters busiest period
21 February 2025
Saudi Arabia has entered what could be the busiest period for power generation capacity buildout in its entire history.
According to data from regional projects tracker MEED Projects and MEED, a total of 53GW of power generation capacity is under construction or about to start construction following the formal award of contracts or the selection of bidders.
Generation and cogeneration plants powered by natural gas account for two-thirds, or 66.7%, of the total capacity under construction, with renewable plants, mainly solar, accounting for the rest.
Solar and wind power plants, however, dominate the pre-execution pipeline, accounting for roughly 94% of the capacity that is currently under bid or prequalification.
Inclusive of projects in the study and design phase, the total thermal and renewable generation capacity being planned and tendered in Saudi Arabia stood at around 80GW as of February 2025.
The major capacity buildout is in line with the kingdom's liquid displacement programme as well as its target for renewable energy sources to account for half its electricity production by 2030.
According to the Energy Institute, Saudi Arabia's total electricity generation in 2023 reached 422.9 terawatt-hours (TWh). Oil accounted for 152.1 TWh, or about 36%, of the total, with natural gas accounting for 265TWh, or 63%, and renewables, 5.8TWh or 1%.
CCGT plants
The urgency of displacing its oil-fired fleets underpins the successive contract awards for combined-cycle gas turbine (CCGT) power generation plants, which are being developed as independent power projects (IPPs) or via engineering, procurement and construction (EPC) contracts.
Roughly 47% of the 35.8GW of gas-fired capacity under construction is being built via an EPC or design and build model, mainly by the Saudi Electricity Company (SEC), while the rest are being built using an IPP model.
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Chinese contractors such as Sepco 3 and China Energy Engineering Corporation, among others, are constructing 10 of the 19 gas-fired power generation and cogeneration plants that are under execution in Saudi Arabia. An eleventh plant is being constructed by Sepco 3 in partnership with Doosan Enerbility, of South Korea. The 11 plants equate to a capacity of roughly 21GW.
South Korean contractors, mainly Doosan and Samsung C&T are in four of the 19 projects.
"I think the Chinese EPC contractors are already at capacity, so SEC has started tapping Egyptian and Spanish EPC contractors," an industry source tells MEED, in reference to Tecnicas Reunidas, Orascom and Elsewedy, which have been selected to undertake the EPC contracts for several CCGT plants last year.
The peak for new gas-fired contract awards may have passed, however.
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However, a "surprise" new project, such as the 3GW expansion of the Qurayyah IPP, announced on 20 February, cannot be ruled out.
Renewables
A reverse trend could be seen for renewable solar power generation capacity.
As of February 2025, nearly all renewable energy capacity under construction in Saudi Arabia is being developed as IPPs.
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The pre-execution pipeline for solar and wind energy projects, which will be procured by SEC and gigaproject developer Neom, is staggering, especially given a directive by the Energy Ministry to procure up to 20GW of renewable energy capacity annually until 2030 subject to demand growth.
"It is a massive pipeline," notes a Dubai-based senior transaction adviser.
However, he also notes that a re-scoping process is under way especially for renewable energy projects designed to cater to Neom, the $500bn development in northwestern Saudi Arabia, which aims to be powered 100% by renewables by 2030.
Issues related to land allocation may also become an issue if it has not yet, notes another industry expert.
Deployment of additional renewable energy capacity will also require a major battery energy storage system buildout, which started last year, to ensure the flexibility of the electricity grid.
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In addition to the liquid displacement programme and the 50% renewable energy production target by 2030, Saudi Arabia has been seeing a major uptick in data centre construction projects in line with a plan to become a major artificial intelligence (AI) hub.
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These projects, assuming they all come to fruition, will significantly increase computing, cooling and overall electricity demand. The need to make these advanced data centres as sustainable as possible will also further incentivise the kingdom's national renewable energy programme.
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READ THE FEBRUARY MEED BUSINESS REVIEW
Trump unleashes tech opportunities; Doha achieves diplomatic prowess and economic resilience; GCC water developers eye uptick in award activity in 2025.
Published on 1 February 2025 and distributed to senior decision-makers in the region and around the world, the February MEED Business Review includes:
> AGENDA 1: Trump 2.0 targets technology> AGENDA 2: Trump’s new trial in the Middle East> AGENDA 3: Unlocking AI’s carbon conundrum> GAZA: Gaza ceasefire goes into effect> LEBANON: New Lebanese PM raises political hopes> WATER DEVELOPERS: Acwa Power improves lead as IWP contract awards slow> WATER & WASTEWATER: Water projects require innovation> INTERVIEW: Omran’s tourism strategies help deliver Oman 2040> PROJECTS RECORD: 2024 breaks all project records> REAL ESTATE: Ras Al-Khaimah’s robust real estate boom continues> QATAR: Doha works to reclaim spotlight> GULF PROJECTS INDEX: Gulf projects market enters 2025 in state of growth> CONTRACT AWARDS: Monthly haul cements record-breaking total for 2024> ECONOMIC DATA: Data drives regional projects> OPINION: Between the extremes as spring approacheshttps://image.digitalinsightresearch.in/uploads/NewsArticle/13411316/main5649.jpg -
SEC and Acwa Power sign Qurayyah IPP expansion deal
20 February 2025
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Riyadh-based utility firm Saudi Electricity Company (SEC) and Acwa Power have signed a power-purchase agreement with the principal buyer, Saudi Power Procurement Company, for the expansion of the Qurayyah independent power project (IPP) in Saudi Arabia.
The Qurayyah IPP expansion project will have a generation capacity of 3,010MW and is expected to be carbon capture-ready, the two firms said in separate bourse filings on 20 February.
SEC and Acwa Power will each have an effective shareholding of 40% in the project, which is valued at SR13.4bn ($3.57bn).
Hajj Abdullah Alireza & Company (Haaco) will own the remaining 20%.
The three firms will develop, finance, build, own and operate the combined-cycle gas turbine plant.
The project also includes the development, financing, construction and transfer of a 380-kilovolt (kV) electrical substation.
The project duration is 25 years from the plant commercial operation date.
Acwa Power, South Korea's Samsung C&T, Mena Infrastructure Fund and SEC own Hajr Electricity Production Company, the development company behind the existing 3.9GW Qurayyah 1 & 2 IPP in Saudi Arabia.
The Qurayyah 1 & 2 IPP reached commercial operations in 2015.
The expansion of the Qurayyah IPP is not to be confused with a separate engineering, procurement and construction (EPC) project with the same name.
Egyptian contractor Orascom is understood to be undertaking the EPC contract for the 3.6GW Qurayyah EPC project.
MEED reported in September 2024 that Orascom had received limited notice to proceed on the project from SEC.
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