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.”
Exclusive from Meed
-
Omani state miner begins silica-sand production
23 September 2025
-
Oman makes strides forward in global LNG race
22 September 2025
-
Kuwait considers relaunching $10bn chemicals complex
22 September 2025
-
Aseer-Jizan highway is a test case for Gulf infrastructure PPPs
19 September 2025
-
Kuwait aims to close bidding for $1.3bn oil projects
19 September 2025
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
-
Omani state miner begins silica-sand production Indrajit Sen
23 September 2025
State-backed Minerals Development Oman (MDO) has announced the start of silica-sand production from its Block 51F concession in the sultanate.
Concession Block 51F is in the Wilayat of Mahout in Al-Wusta Governorate and covers 2,156 square kilometres (sq km).
The block is estimated to contain about 47 million tonnes of silica, limestone and dolomite.
The production site covers approximately 5 sq km within Block 51F. MDO, which was awarded concession rights for Block 51F by Oman’s Ministry of Energy & Minerals (MEMR) in October last year, will act as the resource owner and overall project supervisor.
MDO has appointed Muscat-based The Earth Sciences Consultancy Centre to oversee operations and development of the silica-sand project, including investment and production management.
According to the project development plan approved by the MEMR, initial production capacity is projected at 100,000 tonnes a year (t/y), with a purity level of about 98%.
The initial focus will be on producing and supplying raw silica to local and regional markets to meet growing demand and reduce import dependency, the Oman News Agency (ONA) reported.
Future developments will include establishing a primary silica-processing facility to improve product quality and attract high-tech industries such as semiconductors, glass manufacturing, chemical processing and metallurgical applications, ONA added.
ALSO READ: Oman floats minerals trading company
Silica is a vital raw material for several industries and is used in the production of glass, display screens, semiconductors and advanced materials for solar power and energy storage.
MDO is a subsidiary of the sultanate’s sovereign wealth institution, the Oman Investment Authority (OIA), and was established in 2017. In addition to Block 51F, the company holds concession rights for nearby Block 51K in Al-Wusta Governorate.
MDO began work on the Naqa Salt project in Block 51K last year. Spread across 109 sq km within the 51K concession, the Naqa Salt facility will have an output capacity of up to 2 million t/y. The site is also in the Wilayat of Mahout, near the port of Duqm.
MDO will invest approximately $35m in the project, which it says will produce salt with up to 99% purity.
In May, MDO signed an agreement with India-based Dev Salt to partner on the Naqa Salt project. The company did not specify the nature or terms of the agreement; it is understood to be an offtake agreement for future production.
https://image.digitalinsightresearch.in/uploads/NewsArticle/14722458/main.jpg -
Oman makes strides forward in global LNG race Indrajit Sen
22 September 2025
Commentary
Indrajit Sen
Oil & gas editorOman has recently made notable strides in the global race to lead the production and export of liquefied natural gas (LNG) — a critical enabler of the energy transition.
The Omani government made headlines in July last year, when it announced that majority state-owned Oman LNG would build a new train at its Qalhat LNG production complex in Sur. The new LNG train will have an output capacity of 3.8 million tonnes a year (t/y), increasing Oman LNG’s total production capacity to 15.2 million t/y when it is commissioned in 2029.
Oman LNG recently made key progress on its project to add a fourth processing train at the Sur LNG complex, shortlisting contractors to participate in the main tender for engineering, procurement and construction (EPC) works.
The start of the EPC tendering process and selection of bidders comes within ten months of Oman LNG awarding the contract for front-end engineering and design (feed) works on the project to US-based consultancy KBR.
Separately, MEED recently reported that France’s TotalEnergies is studying a potential expansion of its Marsa LNG bunkering and export terminal in Oman. The move is significant considering that the first phase of the project is currently under construction in the sultanate’s northern industrial city of Sohar, and will have an output capacity of 1 million t/y.
TotalEnergies purportedly began an initial study on a potential second phase of the Marsa LNG facility earlier this year. The French energy major might consider doubling the output capacity of the LNG complex, although the plan is yet to be laid out, according to sources.
Earlier this year, TotalEnergies appointed French contractor Technip Energies as a consultant to perform concept and feasibility studies on the proposed expansion phase of the Marsa LNG terminal, sources told MEED.
With Oman LNG going full throttle with its fourth LNG train project, and TotalEnergies mulling a potential doubling of LNG production in Oman, the sultanate is on course to establish itself as a prominent player in the global LNG domain by the end of this decade.
https://image.digitalinsightresearch.in/uploads/NewsArticle/14716054/main.jpg -
Kuwait considers relaunching $10bn chemicals complex Wil Crisp
22 September 2025
Kuwait is considering relaunching prequalification for its planned Al-Zour integrated complex upgrade programme (Zicup), which is estimated to be worth $10bn.
The Zicup project, also known as the Al-Zour petrochemicals project, or the Petrochemical Refinery Integration Al-Zour Project (Prize), is expected to be integrated with the $16bn Al-Zour refinery and has faced significant delays in recent years.
The project is being developed by state-owned Kuwait Integrated Petroleum Industries Company (Kipic) and the company has not made a final investment decision for the project or revealed a schedule for when the project will be approved and tendered.
In June 2024, MEED reported that Kuwait was still seeking financing for the project.
At the time, a source said that Kipic was looking for a similar financing deal to Kuwait’s Clean Fuels Project, which upgraded and integrated two of the country’s biggest oil refineries.
For the Clean Fuels Project, Italian export credit agency Sace guaranteed a $625m loan issued by a pool of international banks, led by BBVA Milan Branch in the role of Sace facility agent.
The credit arrangement helped state-owned Kuwait National Petroleum Company to finance its strategic $14.5bn Clean Fuels Project, which includes the modernisation and expansion of its Mina Abdullah and Mina Al-Ahmadi refineries.
In September 2024, MEED reported that Kipic had signalled to contractors that the project was no longer a priority.
However, in recent months, Kipic has started to talk to contractors about the project again and is considering relaunching prequalification for the project, according to industry sources.
One source said: “Discussions are now ongoing within Kipic about the future of this project and it could see movement next year. It’s looking like it could go ahead.
“One of the discussions that is currently ongoing in Kipic is around potentially relaunching the prequalification for this project.
“The future of this project is still uncertain – but it is looking much more like it is going to progress compared to at this time last year.
“At this time last year, nobody at Kipic wanted to talk about it and it was clearly not a priority.
“Now, this is a project that is back on the table and they are definitely looking at ways to make it work.”
In January 2023, MEED reported that US-based engineering company Fluor and South Korea’s SK Engineering & Construction had withdrawn from the bidding process for the project.
Kipic prequalified bidders for the planned petrochemicals complex in April 2021.
It published a list of bidders eligible to bid on the three main packages of the project.
The original list of the seven groups prequalified to bid for packages one and two comprised:
- Tecnicas Reunidas (Spain) / Sinopec Engineering Company (China)
- Samsung Engineering (South Korea) / CTCI Corporation (Taiwan) / Consolidated Contractors Company (Lebanon)
- Fluor (US) / Daewoo Engineering & Construction (South Korea) / China Huanqiu Contracting & Engineering Corporation
- Saipem (Italy) / Hyundai Engineering & Construction (South Korea)
- Technip Energies (France)
- SK Engineering & Construction (South Korea) / Petrofac (UK)
- JGC Corporation (Japan)
The scope of package one includes gasoline and olefins units. It was estimated to be worth $4bn and is also known as Gasoline Engineering, Procurement and Construction (EPC) Package 5011.
The scope of package two included aromatics units. It was known as Petrochemical EPC Package 5012.
Package three, known as Marine EPC Package 5013, covered the building of port and export facilities and onshore and offshore pipelines.
Originally, four groups prequalified to bid for package three, estimated to be worth $1.5bn:
- China Harbour Engineering Company (China) / Saipem (Italy)
- SK Engineering & Construction Company (South Korea) / Larsen & Toubro Hydrocarbon Engineering (India)
- Hyundai Engineering & Construction Company (South Korea) / Hyundai Engineering Company (South Korea)
- Eiffage Genie Civil Marine (France) / Afcon Infrastructure (India) / Daewoo Engineering & Construction Company (South Korea)
The project was first announced in 2006.
https://image.digitalinsightresearch.in/uploads/NewsArticle/14714183/main4300.jpg -
Aseer-Jizan highway is a test case for Gulf infrastructure PPPs Yasir Iqbal
19 September 2025
Commentary
Yasir Iqbal
Construction writerRegister for MEED’s 14-day trial access
The start of tendering for the Aseer-Jizan highway public-private patnership (PPP) is a watershed moment in the Gulf region's approach to infrastructure. For decades, the major highways in the GCC have been delivered in the same way: government-funded, government-managed, with little appetite for risk-sharing.
This project breaks that mould. Aiming to be the first full-concession transport PPP in the region, it hands the private partner responsibility for design, construction, financing, operations and maintenance. This is a major step forward.
According to industry experts, the move signals that Saudi Arabia, and by extension the GCC, is ready to treat private investors as partners rather than contractors. The PPP models in social infrastructure have been useful experiments, but this case, where the private sector is taking on long-term risks, demonstrates the market’s growing maturity.
This raises the bar for private involvement and brings the model closer to precedents seen in Europe, Asia and Latin America.
However, there are still unknowns: the offtaker is new to the PPP market, and that adds uncertainty. But for investors, the prestige of being associated with Saudi Arabia’s first highway concession has its own appeal. As long as the payment guarantees are firm, the risk may be worth the reward.
If the project is executed well, it will set the standard for a new pipeline of road, airport and rail schemes. It will also deliver confidence, both for investors, who want predictable frameworks, and for governments, which want to stretch budgets without compromising delivery.
The wider GCC will study the Aseer-Jizan highway PPP carefully. The concession is the first test case that could pave the way for the region's investment-driven infrastructure developments.
Webinar: Unlocking Opportunities: An Insight into the NCP’s Current PPP Project Pipeline in Saudi Arabia
Mon, 29 Sep 2025 | 13:00 GST / 12:00 KSA
Secure your spot now by clicking here
https://image.digitalinsightresearch.in/uploads/NewsArticle/14704209/main.jpg -
Kuwait aims to close bidding for $1.3bn oil projects Wil Crisp
19 September 2025
Register for MEED’s 14-day trial access
State-owned upstream operator Kuwait Oil Company (KOC) is aiming to close the bidding process for two major projects by the end of September, according to sources.
Both projects are focused on the development of an oil separation facility, with their combined value expected to be about KD396m ($1.3bn).
Both tenders have seen several extensions to their bid deadlines since they were originally tendered.
One source said: “KOC has signalled to bidders that the bid deadline extensions are coming to an end.
“They are aiming to see bids submitted before the end of September. There maybe will be a small delay of a week, or something like that, but KOC is really looking to get bids in before the end of September.”
Both contracts were tendered in December 2024 and the original deadline for bid submission for both contracts was set for 16 March.
The first tender, 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 second contract, estimated to be worth KD104m ($338m), is focused on developing separation facilities at GC-25 and a water injection facility at GC-30.
Kuwait is in the middle of an upstream projects push, in line with producing 4 million barrels a day of oil by 2035.
On 10 May 2024, Kuwait’s Emir, Sheikh Mishal Al-Ahmad Al-Sabah, announced the indefinite suspension of parliament in a televised speech.
Under Kuwaiti law, parliament can be suspended for a maximum of four years.
Prior to the suspension of Kuwait’s parliament, the country suffered from very low levels of project awards for several years due to political gridlock and infighting between the country’s cabinet and parliament.
https://image.digitalinsightresearch.in/uploads/NewsArticle/14702553/main0703.png