meed-logo

line1 line2 line3
SIGN IN / REGISTER

Region plans vital big grid connections

29 May 2023

 

The mantra “there will be no transition without transmission” dominated this year’s World Utility Congress, which was organised by Abu Dhabi National Energy Company (Taqa) and held in the UAE capital on 8-10 May.

“There will be no transition without interconnectivity with our neighbours. If we are not interconnected, we are not using the full capacity of our [electricity] network,” UAE Energy and Infrastructure Minister Suhail bin Mohamed al-Mazrouei said at the congress.

For the GCC states in particular, their ability to procure affordable and large-scale solar energy capacity, and the wide discrepancy in peak demands between the winter and summer months, which often results in substantial idle capacity, make it imperative to connect to other states or regions.

“Links to other GCC states and Central Asia will enable our electricity system to run more efficiently. Some have access to wind, others to solar or hydropower. We also have different peak hours,” Al-Mazrouei said. “We need to consider [these opportunities] and make the investments.”

Boosting transmission

In recent years, there has been a flurry of projects to build or enhance electricity transmission links within the GCC states, as well as with neighbouring countries such as Iraq and Jordan.

Contracts were awarded this year for the construction of overhead transmission lines connecting the GCC grid to Iraq via Kuwait, as well as a link between Iraq and Jordan.

Other projects in the early stages include a second connection between Saudi Arabia and Iraq, Saudi Arabia and the UAE, and the UAE and Oman.

Beyond the GCC, a $1.8bn electricity link between Saudi Arabia and Egypt is under construction. The project will facilitate the exchange of 3,000MW of electricity between the two countries through overhead transmission lines as well as high-voltage, direct current (HVDC) subsea cables.

The most ambitious plans include projects that will pipe electricity from Egypt, Tunisia and Morocco to European countries including Greece, Italy and the UK.

Some have access to wind, others to solar or hydropower. We also have different peak hours … we need to consider [these opportunities] and make the investments
UAE Energy and Infrastructure Minister Suhail bin Mohamed al-Mazrouie 

Shifting peaks

Energy security has spurred investments to interconnect electricity grids between national borders and time zones. The pace of development is reminiscent of the advent of data interconnectivity two decades earlier.

Grid interconnections are also critical for the integration and optimisation of renewable energy, according to Jessica Obeid, a partner at New Energy Consult.

“Grid interconnections enable efficient management and mitigations of stability challenges linked to the integration of variable renewable energy such as wind and solar into the grid,” she says.

These interconnections enable the deployment of renewable energy where land is vast and resources are abundant, to be dispatched in energy load centres.

More importantly, they reduce the curtailment of renewable energy systems through electricity exchange, balancing supply and demand at various periods.

UK startup Xlinks aims to connect Morocco to the UK via four HVDC subsea cables stretching 3,800 kilometres across the Atlantic. “Long distance interconnectors solve the intermittency of renewables as the sun is always shining or wind is always blowing elsewhere,” says Simon Morrish, Xlinks’ CEO. 

“The idea is to generate clean energy and then move it to meet demand, which is much more economic than relying solely on domestic capacity.”

Xlinks aims to generate 10.5GW through solar and wind farms in Guelmin Oued Noun and pipe about 40 per cent of that energy through subsea cables that will have to pass through Spain, Portugal and France. The UK will receive 3.6GW of clean, affordable energy – equivalent to 8 per cent of its electricity needs – by 2030.

Soaring data demand drives boom

Desertec’s long shadow

The scale of Xlinks’ ambition draws comparison with an earlier project, the Desertec Industrial Initiative (Dii), which launched in 2009, but ironically has yet to see the light of day.

Dii had planned to build renewable energy plants globally, including in Morocco, and supply up to 15 per cent of Europe’s power demand by 2050.

Xlinks’ proponents expect to succeed where Desertec failed, however. “Generation costs are more than 90 per cent lower than they were then, which makes the project economically – as well as politically – attractive,” Morrish says.

Xlinks’ point-to-point design with an exclusive energy supply for the UK is expected to eliminate challenges associated with trying to use third-party transmission networks.

Although the technologies are all mature, Morrish says iterations have led to a much lower levelised cost of transmission over these distances. There is also more expertise for the HVDC system beyond the original equipment manufacturers.

Average electricity prices in Europe have increased significantly over the past 10 years and power delivered from the Middle East and North Africa (Mena) region is competitive with other reliable low-carbon solutions, according to Morrish.

The existence of clear renewable targets in Europe could also benefit Xlinks’ project, as well as similar schemes, such as the EuroAfrica Interconnector, which aims to link Egypt to Cyprus and Greece, and the Elmed Mediterranean project that links Tunisia to Italy.

Morocco’s renewable energy leadership, which includes having implemented legislation designed to facilitate the export of renewable energy, is another positive factor.

“Previous projects have typically focused on the recipient jurisdiction, such as Europe, rather than understanding the drivers for the generation country,” says Morrish. “By focusing on the benefits to the Mena region, in this case Morocco, Xlinks has obtained support from both Morocco and the UK.”

The 13-year gap between Desertec and Xlinks has not necessarily changed the mindset of some industry players, who are just beginning to grasp the complexities involved in other decarbonisation technologies such as green hydrogen and carbon capture and storage.

“It is an excellent concept, but it will be exceptionally difficult, if not impossible, to execute given the high demand for HVDC cables, financing and political considerations,” says a Dubai-based contractor.

Unlike the more reasonably- structured interconnections between the GCC or Mena states, the scale and scope of Xlinks’ scheme and other similar projects will require export credit and multilateral development agency support in combination with project finance debt. Experts say this is critical, but not entirely unprecedented.

For instance, Taqa’s decision to contribute $31m in the startup’s early funding round, which also includes $6.2m from UK-headquartered Octopus Energy, appears to signify investor appetite for the project. The scheme is expected to boost foreign direct investment and create thousands of jobs in Morocco during its construction phase.

Electricity demand is increasing at alarming rates, in direct relation to the impact of climate change and the increases in temperatures, cooling and water demand, which reduces the available supply for exports
Jessica Obeid, New Energy Consult

Political undertones

In December 2022, Saudi Investment Minister Khalid al-Falih said the kingdom is keen to join an agreement between four countries to export clean electricity from Azerbaijan to Europe.

He was referring to an accord signed by Azerbaijan, Georgia, Romania and Hungary to build an undersea cable in the Black Sea transmitting energy from Caspian Sea wind farms to Europe.

The agreement involves a 1,100-kilometre, 1GW cable running from Azerbaijan to Romania. It is part of broader EU efforts to diversify energy resources away from Russia amid the Ukraine war.

This provides an alternative to Saudi Arabia’s grid expansion plans, and to the Saudi-Egypt link, as Egypt itself is involved in negotiations to link its electricity grid to Italy, Cyprus and Greece.

Beyond financing, there are other challenges for both intra-Mena and intercontinental grid connections.

An efficient electricity exchange market is necessary, notes Obeid. Another key issue is the unsustainable increase in demand in Mena states. 

Figure1: Saudi-Egypt interconnector route

“Electricity demand is rising alarmingly, in direct relation to the impact of climate change and the increases in temperatures, cooling and water demand, which reduces the available supply for exports,” she says.

Plans to interconnect with Iraq, which has been heavily reliant on Iran for energy imports, can also be tricky. “The incentive is mostly political. Many countries have expressed interest in connecting their grids to Iraq’s, but none of these projects have yet materialised,” says Obeid.

“Linking Iraq to the Saudi grid is bound to be more viable and cheaper for Iraq compared to alternative options such as electricity exports from Jordan. But that is pending a political decision and would get Saudi Arabia and the GCC political and economic influence in Iraq.” 

https://image.digitalinsightresearch.in/uploads/NewsArticle/10842129/main.gif
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Deadlines extended for Kuwait oil projects worth $2.5bn

    30 July 2025

    Register for MEED’s 14-day trial access 

    Kuwait’s state-owned upstream operator Kuwait Oil Company (KOC) has extended bid deadlines for six vital oil projects, which are estimated to be worth a total of $2.5bn.

    The first contract, estimated to be worth KD292m ($951m), is focused on developing a separation facility in the NK SA/BA Area, close to Gathering Centre 23 (GC-23) and GC-24.

    The scope of the contract also includes a new injection facility at GC-31 and effluent water injection networks in north Kuwait. The project’s latest bid deadline has been set for 5 August.

    The second contract is to develop the planned Mutriba remote boosting facility in northwest Kuwait. It was originally tendered earlier this year with a bid submission deadline of 29 June. The deadline has now been extended to 17 August.

    The project has an estimated budget of about KD130m ($420m) and its scope includes:

    • Development of the Mutriba oil field
    • Installation of the degassing station
    • Installation of manifolds
    • Installation of condensate facilities
    • Installation of wellhead separation units
    • Installation of the pumping system
    • Installation of wellhead facilities
    • Installation of oil and gas treatment plants
    • Installation of a natural gas liquids plant
    • Installation of a water and gas injection plant
    • Construction of associated utilities and facilities

    The onshore Mutriba oil field is located in northwest Kuwait.

    In October 2024, KOC announced that it was preparing to tender a project management contract for a scheme to develop the field.

    At the time, it said four international companies had been invited to participate in the tender process. These were:

    • Schlumberger (US)
    • Halliburton (US)
    • Baker Hughes (US)
    • Weatherford International (US)

    KOC also said that the list of qualified companies could be extended before the invitation to bid was issued.

    The third project, estimated to be worth $100m, is for an effluent water injection network in north Kuwait. The bid deadline has been extended to 5 August.

    Effluent water injection or water flooding is a secondary hydrocarbons recovery technique where produced water is injected into a well’s formation under high pressure and temperature conditions to recover more of the oil initially in place.

    The fourth project is estimated to be worth around $100m and is focused on the construction of a new injection network in north Kuwait that will service the Sabriyah/Bahra (SA/BA) area. Its bid deadline has also been extended to 5 August.

    The fifth project that has had its deadline extended is focused on developing Jurassic Light Oil (JLO) export facilities and upgrading the existing export network.

    The main contract bid submission date for the project, which is understood to have a budget of KD175m ($569m), has been changed to 3 August.

    The project was originally tendered in November last year with a bid deadline of 1 December 2024. Other recent deadlines have included 15 July, 24 June, 27 May, 27 April and 6 April.

    In an announcement in April last year, KOC prequalified up to 15 contractors to bid for these projects:

    • CTCI (Taiwan)
    • Daewoo Engineering & Construction (South Korea)
    • Fluor (US)
    • Hyundai Engineering & Construction (South Korea)
    • Hyundai Engineering Company (South Korea)
    • Hyundai Heavy Industries (South Korea)
    • JGC Corporation (Japan)
    • Larsen & Toubro Energy Hydrocarbon (India)
    • NMDC Energy (UAE)
    • Petrofac (UK)
    • Saipem (Italy)
    • Samsung E&A (South Korea)
    • Sinopec Engineering Corporation (China)
    • Sinopec Luoyang Engineering Company (China)
    • Tecnicas Reunidas (Spain)

    In September 2024, KOC announced a second list of 13 prequalified contractors, with Hyundai Heavy Industries and NMDC Energy removed from the list.

    At the time, KOC said that companies not included on the list could file a complaint against their non-inclusion before the official invitation to bid on the project.

    It is unclear whether more prequalified companies have been added or removed from the list since September.

    The sixth project that has seen its bid deadline extended is focused on developing separation facilities at GC-25 and a water injection facility at GC-30.

    The contract is estimated to be worth KD104m ($338m). In the latest extension, the bid deadline has been set for 10 August.

    Kuwait is in the middle of an upstream projects push, in line with its goal of producing 4 million barrels a day of oil by 2035.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/14364081/main4907.jpg
    Wil Crisp
  • Arada awards $16m retail complex construction deal

    30 July 2025

    Sharjah-based real estate developer Arada has awarded a AED60m ($16m) contract to build the Masaar Central project in the Suyouh district of Sharjah.

    The contract was given to the local firm Intermass Engineering & Contracting.

    Masaar Central will serve as the retail hub at the centre of the Masaar project.

    Construction is expected to begin soon, with completion slated for 2026.

    Masaar Central will offer retail, dining, wellness and education facilities over an area of 53,000 square feet.

    In June last year, Arada awarded a AED830m ($226m) contract to Intermass Engineering & Contracting to build 597 units in the Saro cluster of the Masaar project.

    Intermass has previously completed the Sendian cluster, the first residential phase of Masaar, and is currently working on Robinia, Masaar’s third phase.

    Valued at AED8bn, the Masaar scheme includes 4,000 villas and townhouses across eight gated districts, featuring a nature-inspired masterplan with more than 50,000 trees.

    Arada’s new project launches reflect increased activity in the UAE real estate market, where projects worth over $323bn are in execution or planning stages.

    This aligns with a forecast from UK data analytics firm GlobalData, predicting that the UAE construction sector will grow by 4.2% in real terms in 2025, driven by infrastructure, energy, utilities and residential construction projects.

    READ THE AUGUST 2025 MEED BUSINESS REVIEW – click here to view PDF

    Gulf heads into a new era of aviation; Maghreb’s resilience rises despite global pressures; GCC banks expand issuance amid demand

    Distributed to senior decision-makers in the region and around the world, the August 2025 edition of MEED Business Review includes:

    > MAGHREB MARKET FOCUS: Maghreb pushes for stability
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/14364351/main.jpg
    Yasir Iqbal
  • Contract award nears for King Salman airport runway

    30 July 2025

    Related stories:

    > Middle East invests in giant airports
    > Broader region upgrades its airports
    > Global air travel shifts east

     

    Register for MEED’s 14-day trial access 

    King Salman International Airport Development Company (KSIADC) has received best and final offers (bafos) for a design-and-build contract to develop the third runway at King Salman International airport (KSIA) in Riyadh.

    "Bafos were submitted earlier this month [in July] and the contract is expected to be finalised soon," a source close to the project told MEED.

    It is understood that the third and fourth runways will add to the two existing runways at Riyadh’s King Khalid International airport, which will eventually become part of KSIA.

    In February, MEED exclusively reported that firms had submitted prequalification documents on 18 January for a contract to develop the third runway and taxiways at KSIA.

    KSIADC, which is backed by Saudi sovereign wealth vehicle the Public Investment Fund, received interest from firms in December last year for the package.

    KSIADC previously prequalified firms for the main engineering, procurement and construction packages and early and enabling works, as well as other elements of the construction work. These included specialist systems and integration; materials and equipment; engineering and design; professional services; health, safety, security, environment and wellbeing services; modular installation and prefabrication; local content; and environmental, social and governance (ESG) and other services.

    The entire scheme is divided into eight assets:

    • Iconic Terminal
    • Terminal 6
    • Private aviation terminal 
    • Central runway and temporary apron
    • Hangars
    • Landside transport
    • Cargo buildings
    • Real estate

    In August last year, KSIADC appointed several architectural and design firms for the various elements of the project.

    KSIADC confirmed that it had signed up UK-based Foster + Partners to design the airport’s masterplan, including the terminals, six runways and a multi-asset real estate area.

    US-based engineering firm Jacobs will provide specialist consultancy services for the masterplan and the design of the new runways.

    The client also confirmed the appointment of UK-based engineering firm Mace for the delivery partner role on the project.

    The airspace design consultancy contract was awarded to local firm Nera.

    Mega airport project

    The project covers an area of about 57 square kilometres (sq km), allowing for six parallel runways. It will include the existing terminals at King Khalid International airport, as well as 12 sq km of airport support facilities, residential and recreational facilities, retail outlets and other logistics real estate.

    If the project is completed on time in 2030, it will become the world’s largest operating airport in terms of passenger capacity, according to UK analytics firm GlobalData.

    The airport aims to accommodate up to 120 million passengers by 2030 and 185 million by 2050. The goal for cargo is to process 3.5 million tonnes a year by 2050.

    Saudi Arabia plans to invest $100bn in its aviation sector. Riyadh’s Saudi Aviation Strategy, announced by the General Authority of Civil Aviation, aims to triple Saudi Arabia’s annual passenger traffic to 330 million travellers by 2030.

    It also aims to increase air cargo traffic to 4.5 million tonnes and raise the country’s total air connections to more than 250 destinations. 

    READ THE AUGUST 2025 MEED BUSINESS REVIEW – click here to view PDF

    Gulf heads into a new era of aviation; Maghreb’s resilience rises despite global pressures; GCC banks expand issuance amid demand

    Distributed to senior decision-makers in the region and around the world, the August 2025 edition of MEED Business Review includes:

    > MAGHREB MARKET FOCUS: Maghreb pushes for stability
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/14363916/main.jpg
    Yasir Iqbal
  • NMDC Energy begins fabrication at Saudi Arabia yard

    29 July 2025

    Register for MEED’s 14-day trial access 

    Abu Dhabi-owned contractor NMDC Energy has started fabrication activities at its new yard in Ras Al-Khair, Saudi Arabia.

    Built at a cost of AED200m ($54.5m), the yard covers 400,000 square metres within the Ras Al-Khair Special Economic Zone in the kingdom’s Eastern Province. It has a production capacity of 40,000 tonnes a year.

    NMDC Energy held a steel-cutting ceremony on 28 July to mark the start of operations at the Ras Al-Khair yard.

    The Abu Dhabi Securities Exchange-listed company inaugurated the facility in mid-January.

    NMDC Energy signed a memorandum of understanding with Aramco to build the facility in 2018, when it was known as National Petroleum Construction Company (NPCC).

    Nine offshore jackets are currently in production for NMDC Energy’s client, Saudi Aramco.

    More than 1,800 employees will be mobilised from Abu Dhabi to the Saudi Arabia yard, NMDC Energy said.

    “The Ras Al-Khair yard is central to NMDC Energy’s Saudi strategy and localisation roadmap. Over the past five years, the company has reinvested billions of riyals into the Saudi economy and is on track to increase its In-Kingdom Total Value Add score to 39% by 2025 and 51% by 2028,” NMDC Energy added.

    ALSO READ: Aramco offshore contract awards set to rebound

    READ THE AUGUST 2025 MEED BUSINESS REVIEW – click here to view PDF

    Gulf heads into a new era of aviation; Maghreb’s resilience rises despite global pressures; GCC banks expand issuance amid demand

    Distributed to senior decision-makers in the region and around the world, the August 2025 edition of MEED Business Review includes:

    > MAGHREB MARKET FOCUS: Maghreb pushes for stability
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/14359665/main.jpg
    Indrajit Sen
  • Miral moves Harry Potter theme park bid deadline

    29 July 2025

     

    Register for MEED’s 14-day trial access 

    Abu Dhabi’s Miral has extended the bid submission deadline for a tender to build a Harry Potter-themed expansion at the Warner Bros World Yas Island entertainment destination in Abu Dhabi.

    Earlier this month, MEED exclusively reported that the tender for the estimated AED2bn-AED3bn ($545m-$816m) main construction works had been issued to contractors, with bids initially due on 28 July.

    Miral has extended the bid submission deadline until 4 August, according to sources.

    The scope of the Warner Bros World phase two expansion includes adding 40,000 square metres (sq m) to the existing theme park. This will include a Harry Potter-themed zone with three new rides, retail outlets, and food and beverage facilities.

    Enabling works for the project have begun and are being undertaken by local firm NSCC International. Another local firm, Emirates Electrical & Instrumentation Company, is carrying out the early works.

    Canadian engineering firm EllisDon is the project consultant, and French firm Egis is the lead designer.

    According to media reports, the Abu Dhabi project will be the world’s sixth Harry Potter-themed park. The others are in Florida and California in the US, Beijing in China, Osaka in Japan and Leavesden in the UK.

    The Abu Dhabi project was first announced in November 2022.

    Yas Waterworld

    Miral has developed a series of theme parks and other entertainment-related attractions on Yas Island, working with several local and international contractors.

    On 1 July, Miral opened a new 16,900 sq m expansion of its Yas Waterworld park to the public.

    The expansion added 3.3 kilometres of slide sections to the park. The addition of 18 new rides and attractions, bringing the total number of rides to more than 60, is expected to increase visitor capacity by 20%.

    Construction was carried out by local contractor Alec.

    Disney park

    In May, The Walt Disney Company and Miral signed an agreement to build a Disney theme park resort on Yas Island.

    Disney, which is based in the US, said the Abu Dhabi site will be its seventh theme park resort. The others are in California and Florida in the US, Paris in France, Hong Kong and Shanghai in China, and Tokyo in Japan.

    In a statement, Disney noted that the UAE is located within a four-hour flight of one-third of the world’s population, making it a significant gateway for tourism. It is also home to one of the world's busiest airline hubs, with 120 million passengers travelling through Abu Dhabi and Dubai each year.

    The Disney theme park resort in Abu Dhabi will include entertainment areas, themed accommodations, dining venues and retail experiences.

    In 2023, Miral opened SeaWorld Abu Dhabi, also on Yas Island. Alec was the contractor for the estimated $565m project.

    In 2018, Miral opened the Warner Bros theme park on Yas Island. Belgium’s Besix was the contractor for the estimated $531m project.

    Other Miral projects have included the Etihad Arena and the indoor climbing and skydive centre Clymb. Bam International of the Netherlands was the contractor for the arena and Germany’s Zublin was the contractor for Clymb.

    Yas Island was launched as a project in 2006 by local developer Aldar Properties. The original centrepiece attractions were the Yas Marina Circuit, which hosts Formula 1 motor racing’s annual Abu Dhabi Grand Prix, and the Ferrari World theme park.

    READ THE AUGUST 2025 MEED BUSINESS REVIEW – click here to view PDF

    Gulf heads into a new era of aviation; Maghreb’s resilience rises despite global pressures; GCC banks expand issuance amid demand

    Distributed to senior decision-makers in the region and around the world, the August 2025 edition of MEED Business Review includes:

    > MAGHREB MARKET FOCUS: Maghreb pushes for stability
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/14358463/main.jpg
    Yasir Iqbal