x Abu Dhabi, UAEThursday 27 July 2017

A Gulf state with power to spare

Qatar's investment in the domestic power sector has allowed it to expand overseas

A RasGas Q-flex carrier, above. Qatar is on the cusp of generating enough capacity to supply its growing domestic electricity demand for the next five years.
A RasGas Q-flex carrier, above. Qatar is on the cusp of generating enough capacity to supply its growing domestic electricity demand for the next five years.

While many Gulf states struggle to meet their power demands at home, Qatar has developed enough generating capacity to allow it to invest in projects abroad.

When the Ras Girtas power plant begins operating in April, Qatar Electricity and Water Company will have enough generating capacity to supply its growing domestic electricity demand for the next five years, Fahad al Mohannadi, the managing director of the power developer, said last month.

"We have the technical and financial capability now to bid for overseas projects," he said.

For its newest foreign venture, the companyhopes to participate in the construction of a Saudi power plant. "We have put together a joint-venture agreement, which is yet to be signed with other investors," Mr al Mohannadi said this month. He did not identify the partners.

The group plans initially to bid on the first phase of the proposed 1,500 megawatt Qurayyah project in Saudi Arabia, which is in the pre-qualification stage.

Mr al Mohannadi said the utility company was also bidding on a power project in Oman while considering additional investments in India, Turkey, South Korea and Vietnam.

Last month, he said the company had launched projects in Germany, east Asia and Syria. The Syrian power project, however, has been put on hold as that country's government reviews its strategy.

Projects in Georgia may also be on the cards. A Georgian delegation to be led by the foreign minister, Grigol Vashadze, is to visit Doha next week with the intention of signing several economic agreements, mainly in the field of energy.

Qatar has expressed interest in hydropower opportunities in the Caucasian state, a Georgian official said on Monday in Tblisi.

The Qatari utility, which is the third-largest publicly traded utility by revenue in the Middle East, is 43 per cent owned by the government of Qatar. The company posted net profit of 834.5 million rials (Dh841.6m) on revenue of 2.34 billion rials for the first nine months of last year.

Qatar's power demand has been expanding by more than 10 per cent annually in recent years, but the emirate will widen its already comfortable margin of reserve generating capacity this year. At more than 9,000mw, the country's capacity is expected to be about 47 per cent higher than last year's peak demand.

Nevertheless, Qatar's biggest power expansion lies ahead.

Officials of Qatar General Electricity and Water Corporation, a state-owned utility that is responsible for power distribution in the emirate, said this month the country would invest 70bn rials in infrastructure projects in the next 10 years, including 30bn rials in the power sector. An additional 20bn rials would be spent to lay water pipelines.

Qatar's power demand could expand dramatically in coming years as the emirate pursues economic diversification in energy-intensive areas such as petrochemicals and heavy industry and gears up to host the 2022 Fifa World Cup.

Officials of Qatar Electricity and Water have predicted that the number of hotels in Qatar would double this decade. The emirate is also expected to build residential and commercial developments and a railway system.

Unlike other Gulf states, which even now face summer power cuts, Qatar has few worries about fuelling its power projects. The emirate shares the world's biggest gasfield with Iran and in recent years has aggressively developed its side of the deposit.

Several of Qatar's GCC neighbours, including the UAE, Kuwait and Oman, import gas to meet domestic demand.

 

tcarlisle@thenational.ae