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Qatar keeping pace

by Adam Lane on Jan 6, 2013

KAHRAMAA has recently invested in reservoirs to boost emergency water supplies.
KAHRAMAA has recently invested in reservoirs to boost emergency water supplies.

Qatar has been a persistent object of interest for a good portion of the utilities sector over the last year, with many commentators talking in excited terms about the country’s construction and infrastructure boom.

The World Cup 2022 is an obvious focal point, with the probable approach of tender opportunities getting louder and louder for a slice of the estimated staging budget of some US $70 billion. Potential opportunities for those working in utilities infrastructure seem numerous – with everything from district cooled stadiums, much-expanded wastewater capacity and renewable energy commitments likely to represent years of work for regional and international operators.

However, beyond the excitement are suggestions of a slow-down in the exceptional growth figures the country has recorded. The International Monetary Fund has forecast GDP growth of 6.3% for 2012, down from 14.1% a year earlier. This is expected to slow further through this year, with growth of 4.3% predicted over 2013. Whilst this, of course, still represents impressive growth in the present economic climate, it is interesting to hear from the industry on what the World Cup prospect represents.

“The main driver of demand [across the region] has been, and continues to be, infrastructure development. In Qatar, it is probably more industrial – more oil and gas dominant. I think with the World Cup, it’s early days. There are a lot of plans, and it will come into execution in its own time; in the right time. But it holds a strong appeal.

“I think with Qatar, the very large growth experienced when the oil and gas sector was developed was not published that widely. If you look at the billions of dollars invested in that period, even with something like the World Cup, it’s going to be very difficult to maintain the same growth,” said ABB’s Johan de Villiers, speaking to Utilities Middle East late last year.

Whether the long-term growth is maintained or not; the near-term development potential still looks very bright. A report by Ventures Middle East, released late last year, forecast that Qatar was set to agree power and water contracts valued at $3.2 billion through 2013 alone – a small slice of the total $32 billion expected across the GCC, but hugely significant given the relatively tiny total population.

On the electricity front, Qatar’s rising population (put at 6.1% growth in 2011 by the World Bank) and increased industrial development is forecast, by Business Monitor International, to mean average annual electricity demand growth of 6.7%.

Generation capacity– principally of the gas-fired variety – will necessarily need to move to keep pace, and is expected, in the same report, to average 6% per year. The country is also looking closely at the potential of renewable energy. In addition to recent reports of massive solar spending plans, the country is also set to host its own huge polysilicon manufacturing facility.

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