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• 
  Saudi Arabia takes 2GW energy storage steps

  1 May 2024

  Saudi Power Procurement Company (SPPC) is several months away from seeking interest from developers for the contract to develop and operate the 2,000MW first phase of a battery energy storage system (bess) catering to the grid.

  According to an industry source, the principal buyer and its consultants are finalising the project sites, and the start of the procurement process could be "a few months away".

  SPPC plans to procure up to 10GW, equivalent to 40 gigawatt-hours (GWh), of bess capacity by 2030.

  MEED previously reported that the principal buyer conducted a market-sounding event for the project in December 2023, in line with a plan to launch the procurement process for one-fifth of this capacity this year.

  The 2GW first phase of the project involves building multiple battery energy storage systems across multiple locations, with individual capacities ranging from 50MW to 300MW. 

  The project will be developed using an independent power producer (IPP) model.

  The planned bess facilities are to be built near demand centres. They will boost the electricity grid's spinning reserves as more renewable energy enters its electricity production mix.

  Bess comprises rechargeable batteries that can store and discharge energy from various sources when needed. It is one of the key solutions being considered to address the intermittency of renewable energy sources.

  US/India-based Synergy Consulting is advising SPPC on the planned bess IPP.

  The first-phase project may or may not become part of round six of the kingdom's National Renewable Energy Programme (NREP), which currently involves the development of wind IPPs, as MEED previously reported.

  Growing renewable capacity

  Saudi Arabia, through SPPC, publicly tendered over 6,600MW of renewable energy capacity under the first four rounds of NREP between 2017 and 2023.

  Solar photovoltaic (PV) IPP projects account for 66% of the total capacity, or about 4,400MW. Wind IPPs account for the remaining capacity.

  At least three of these schemes are now operational: the 300MW Sakaka solar PV, the 400MW Dumat Al Jandal wind IPP and the Rabigh solar IPP projects.

  The bid results for the three wind IPPs under round four of the kingdom's NREP are yet to be released.

  Round five

  In February, SPPC tendered contracts to develop four solar PV IPPs under the NREP fifth procurement round.

  The following solar PV IPP projects and their capacities make up round five of the NREP:

  • Al Sadawi solar IPP (Eastern Province): 2,000MW
  • Al Mas solar IPP (Hail): 1,000MW
  • Al Hinakiyah 2 solar IPP (Medina): 400MW
  • Rabigh 2 solar IPP (Mecca): 300MW

  SPPC will procure 30% of the kingdom's target renewable energy installed capacity of 58,700MW through a public tendering process by 2030.

  Saudi sovereign wealth vehicle, the Public Investment Fund, is procuring the rest through the Price Discovery Scheme.

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  Jennifer Aguinaldo
• 
  UAE maintains positive economic heading

  30 April 2024

  Register for MEED's guest programme 

  

  Sources: IMF (April 2024), MEED Projects, MEED

  ---

  MEED’s May 2024 special report on the UAE also includes:

  > COMMENT: Non-oil activity underpins UAE economy
  > GVT & ECONOMY: Non-oil activity underpins UAE economy
  > BANKING: UAE banks seize the moment
  > UPSTREAM: Adnoc oil and gas project spending sees steep uptick
  > DOWNSTREAM: UAE builds its downstream and chemical sectors
  > POWER: UAE marks successful power project deliveries
  > WATER: Dubai tunnels project dominates UAE pipeline
  > DUBAI CONSTRUCTION: Dubai real estate boosts construction sector
  > ABU DHABI CONSTRUCTION: Abu Dhabi makes major construction investments

  ---

  

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  MEED Editorial
• 
  Read the May 2024 MEED Business Review

  30 April 2024

  Download / Subscribe / Guest programme

  The rising importance of natural gas as an energy transition fuel has led to strong growth in its demand worldwide.

  Global liquefied natural gas (LNG) demand is expected to leap by more than 50% by 2040, as industrial coal-to-gas switching gathers pace in China and countries in south and southeast Asia use more LNG to support their economic growth.

  Gulf players are keen to cater to this growing demand and dominate the global supply market, fuelling a wave of investment in large-scale production-boosting projects and terminal construction schemes worth billions of dollars each.

  The best example is the $7.7bn of engineering, procurement and construction contracts awarded by Saudi Aramco in early April to expand the Fadhili gas plant.

  In the latest issue of MEED Business Review, MEED's oil and gas editor Indrajit Sen discusses the steps the region is taking to cement its position as the world’s largest LNG supplier.

  We also look at how regional LNG producers are safeguarding their project investments by winning deals with international customers.

  Meanwhile, this month's exclusive 17-page market report highlights the UAE, where resilient non-oil growth is outshining oil sector weakness and regional troubles – for now.

  MEED's latest issue is packed with insight and analysis. The team considers the worldwide impact of the Iranian attack on Israel; examines the setbacks in Algeria's oil sector; looks at the overdue progress on oil mergers in Kuwait; and brings readers up to date on Iraq's projects market. We also discuss why negative growth at home is expected to fuel South Korean contractors’ appetite for work in Saudi Arabia.

  This month's industry report features MEED's GCC construction contractor ranking for 2024. Using data from regional projects tracker MEED Projects, the ranking – which is topped by Nesma & Partners with $14.7bn of work at the execution stage – reveals a major change in construction activity in the GCC over the past year. 

  The May issue includes an interview with Omar Abduljabbar, CEO of Hail Region Development Authority, in which he reveals why Saudi Arabia's northwestern region of Hail is expected to become a key destination for tourism and investment in the coming years. We also talk to Etihad Water & Electricity chief executive Yusuf Al Ali about providing water and power with the lowest carbon possible in the UAE's northern emirates.

  We hope our valued subscribers enjoy the May 2024 issue of MEED Business Review. 

  

   

  Must-read sections in the May 2024 issue of MEED Business Review include:

  > AGENDA: Region boosts LNG spending; Gulf players secure future of LNG projects

  > CURRENT AFFAIRS: ​Algerian downstream sector faces setback; Progress on Kuwait oil mergers is overdue; Iranian attack on Israel rattles globe

  INDUSTRY REPORT: MEED’s GCC Contractor Rankings for 2024  > Construction step change boosts order books

  > SOUTH KOREA: South Korean appetite for Saudi projects grows

  > IRAQ: Iraq remains tough to sell

  > INTERVIEWS: Saudi Arabia's Hail capitalises on heritage; Northern emirates’ energy transition gathers pace

  > GAS SPENDING: Aramco in hot pursuit of 2030 gas production goal

  > UAE MARKET REPORT:

  > COMMENT: Non-oil activity underpins UAE economy
  > GVT & ECONOMY: Non-oil activity underpins UAE economy
  > BANKING: UAE banks seize the moment
  > UPSTREAM: Adnoc oil and gas project spending sees steep uptick
  > DOWNSTREAM: UAE builds its downstream and chemical sectors
  > POWER: UAE marks successful power project deliveries
  > WATER: Dubai tunnels project dominates UAE pipeline
  > DUBAI CONSTRUCTION: Dubai real estate boosts construction sector
  > ABU DHABI CONSTRUCTION: Abu Dhabi makes major construction investments

  > MEED COMMENTS: 
  > Gulf of Aqaba moves beyond Instagram
  > Net zero steps need recalibration
  > Flooding spotlights Dubai construction
  > Funding impacts Saudi projects

  > GULF PROJECTS INDEX: Saudi market returns to growth

  > MARCH 2024 CONTRACTS: Iran gas contract boosts value of deals signed

  > MARKET SNAPSHOT: Mena data centre projects

  > OPINION: Rainmaking in the world economy

  > BUSINESS OUTLOOK: Finance, oil and gas, construction, power and water contracts

  To see previous issues of MEED Business Review, please click here

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  MEED Editorial
• 
  Abu Dhabi holds Taweelah C roadshow

  30 April 2024

  Abu Dhabi state utility and offtaker Emirates Water & Electricity Company (Ewec) conducted an investor roadshow last week for its upcoming combined-cycle gas turbine (CCGT) independent power project (IPP).

  Ewec met with at least six utility developers separately, according to sources familiar with the scheme.

  MEED previously reported that Ewec is considering issuing a tender in the next few weeks for its first gas-fired IPP since 2020.

  It is understood that the planned Taweelah C IPP is expected to have a generation capacity of roughly 2,700MW.

  The power-purchase agreement (PPA) for Taweelah C is expected to expire by 2049, which is several years shorter than previous PPAs and in line with the UAE's plan to reach net-zero carbon emissions by 2050.

  A team of UK-based Alderbrook Finance and US-based Sargent & Lundy are providing financial and technical advisory services to Ewec for the Taweelah C IPP.

  The greenfield IPP is planned to reach commercial operation by 2027, according to a recent Ewec capacity procurement statement.

  Andy Biffen, executive director of asset development at Ewec, told the recent World Future Energy Summit in Abu Dhabi that the request for proposals (RFPs) for its next CCGT plant will explicitly require the developers or developer consortiums to accommodate the installation of carbon-capture facilities once these solutions are commercially viable.

  The state utility is considering new gas-fired capacity in light of expiring capacity from several independent water and power producer (IWPP) facilities.

  The plants that will reach the end of their existing contracts during the 2025-29 planning period include:

  •  Shuweihat S1 (1,615MW, 101 million imperial gallons a day (MIGD)): expires in June 2025
  •  Sas Al Nakhl (1,670MW, 95MIGD): expires in July 2027
  •  Taweelah B (2,220MW, 160MIGD): expires in October 2028
  •  Taweelah A1 (1,671MW, 85MIGD): expires in July 2029

  Ewec and the developers and operators of these plants are expected to discuss whether a contract extension is possible before the expiry of the contracts. Unsuccessful negotiations will result in the dismantling of the assets at the end of the contract period.

  In 2022, MEED reported that Abu Dhabi had wound down the operation of Taweelah A2, the region's first independent water and power project. The power and water purchase agreement supporting the project expired in September 2021 and was not extended.

  Ewec awarded its last CCGT IPP nearly four years ago. Japan's Marubeni Corporation won the contract to develop the Fujairah F3 IPP in 2020.

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  Jennifer Aguinaldo
• 
  Region puts its priorities first

  30 April 2024

  Commentary
  Colin Foreman
  Editor

  Read the May 2024 issue of MEED Business Review

  Contractors enjoyed a record year in 2023. In the GCC, there were $205bn of deals signed. The best total on record was achieved largely due to high levels of activity across all major markets.

  At the start of this year, hopes were high that new records would be set again in 2024. Those aspirations look like they may be realised. According to regional projects tracker MEED Projects, by the end of the first quarter of this year there had been $47bn of awards in the GCC, some $10bn more than the $37bn of awards during the same period of 2023.

  The strong start to the year comes despite some tempering of project ambitions, most notably in the region’s largest market, Saudi Arabia. In January, the kingdom’s Energy Ministry instructed Saudi Aramco to halt plans to increase its production capacity to 13 million barrels of crude oil a day.

  The negative impact of that decision on the projects market, will be offset by gas projects. Gas is considered a vital transition fuel, and strong global demand growth is allowing Gulf producers to develop new projects worth billions of dollars each and consolidate their position as the world’s leading gas exporter. The best example is the $7.7bn of engineering, procurement and construction contracts awarded by Saudi Aramco in early April to expand the Fadhili gas plant.

  For the construction sector, there has been a prioritisation of construction work for Saudi Arabia’s gigaprojects. As construction work in the kingdom ramps up, developers are focusing efforts on delivering the components of their projects that they consider to be a strategic priority, and are scaling back work on other elements.

  Developers are also more proactively seeking external investment to help ease the spending burden of their vast projects.

  As we move deeper into 2024, the key question will be whether these priority projects will be sufficient to achieve another record year. Unlike 2023, not everything is moving ahead, but very large projects are still proceeding.

  ---

  Must-read sections in the May 2024 issue of MEED Business Review include:

  > AGENDA: Region boosts LNG spending; Gulf players secure future of LNG projects

  > CURRENT AFFAIRS: ​Algerian downstream sector faces setback; Progress on Kuwait oil mergers is overdue; Iranian attack on Israel rattles globe

  INDUSTRY REPORT: MEED’s GCC Contractor Rankings for 2024  > Construction step change boosts order books

  > SOUTH KOREA: South Korean appetite for Saudi projects grows

  > IRAQ: Iraq remains tough to sell

  > INTERVIEWS: Saudi Arabia's Hail capitalises on heritage; Northern emirates’ energy transition gathers pace

  > GAS SPENDING: Aramco in hot pursuit of 2030 gas production goal

  > UAE MARKET REPORT:

  > COMMENT: Non-oil activity underpins UAE economy
  > GVT & ECONOMY: Non-oil activity underpins UAE economy
  > BANKING: UAE banks seize the moment
  > UPSTREAM: Adnoc oil and gas project spending sees steep uptick
  > DOWNSTREAM: UAE builds its downstream and chemical sectors
  > POWER: UAE marks successful power project deliveries
  > WATER: Dubai tunnels project dominates UAE pipeline
  > DUBAI CONSTRUCTION: Dubai real estate boosts construction sector
  > ABU DHABI CONSTRUCTION: Abu Dhabi makes major construction investments

  > MEED COMMENTS: 
  > Gulf of Aqaba moves beyond Instagram
  > Net zero steps need recalibration
  > Flooding spotlights Dubai construction
  > Funding impacts Saudi projects

  > GULF PROJECTS INDEX: Saudi market returns to growth

  > MARCH 2024 CONTRACTS: Iran gas contract boosts value of deals signed

  > MARKET SNAPSHOT: Mena data centre projects

  > OPINION: Rainmaking in the world economy

  > BUSINESS OUTLOOK: Finance, oil and gas, construction, power and water contracts

  To see previous issues of MEED Business Review, please click here

  https://image.digitalinsightresearch.in/uploads/NewsArticle/11725549/main.gif

  Colin Foreman