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Driving force

Meet Joe Anis, GE Energy's Middle East president

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Joe Anis, president of GE's Middle East region
Joe Anis, president of GE's Middle East region
GE is seeking to capitalise on the region's nuclear ambitions.
GE is seeking to capitalise on the region's nuclear ambitions.
Iraq's power generation infrastructure is in urgent need of an upgrade.
Iraq's power generation infrastructure is in urgent need of an upgrade.
The GE 9FA Heavy Duty Frame Gas Turbine.
The GE 9FA Heavy Duty Frame Gas Turbine.

GE Energy has been doing business in the region since the 1930s. Utilities Middle East met Joe Anis, the division’s Middle East president, to find out what is driving business.

Governments across the Middle East are busying themselves building a state-of-the-art utilities infrastructure, or are simply racing to keep up with demand for power and water, and few companies are as well positioned to cater to this as GE.

The numbers speak for themselves. In the past two years, GE Energy, responsible for the firm’s power, water, and oil and gas business, has secured projects worth over US$11 billion in the region.

The division benefits from a diverse portfolio that encompasses power generation equipment, smart grid components, water treatment and servicing.

Joe Anis, GE Energy’s president in the Middle East, is optimistic that business will remain brisk. He bases his optimism on the prediction that demand for power will double, and demand for water triple, over the next 10 years.

“Its exciting to see the figures here in the region, I’d say on average [yearly] demand growth is probably around seven to eight percent.”

Anis is reluctant to list favourites, but says that the orderbook in countries such as Saudi Arabia, the UAE, Qatar, Egypt and Iraq has been strong.

Iraq, with its need to rebuilt its infrastructure after decades of war and sanctions, has contributed handsomely to GE Energy’s bottom line. (See case study)

Business growth is linked to a strong economy. In the post-recession environment, in which many economies are struggling to regain momentum, the Middle East has thus gained in importance.

“When you look around the world, you look at this multi-speed environment, you can see that in parts of the world GDP is flat or only growing slightly, and there are parts of the world where we see more traction, and certainly the Middle East is an area we see good growth prospects,” says Anis.

A wide-ranging product offering apart, the company’s sales have also benefitted from the additional services it provides to its customers. Notably, the firm’s financial arm can offer government utilities and private companies help in gaining access to project finance.

GE Capital Markets facilitates debt and equity deals for those entities, utilising its relationships with regional and international banks alike.

An example of this is the $913 million loan the Saudi Electricity Company (SEC) secured from the US Export Import Bank (Ex-Im Bank) in 2009.

The loan, set up with the help of GE Capital Markets, financed the purchase of 23 7FA gas turbines with integrated NOx emission reduction equipment.

The SEC used the turbines for three separate power projects, which generate a total of almost 3,000MW.

Export-import banks play a big role in project finance in the Middle East and elsewhere. In 2008, Ex-Im Bank alone provided $14,4 billion in funding to support US exports. GE has the good fortune of being able to draw funding from more than one country.

“We are a global company, so depending on where our products are coming from, we can leverage. We can use the US Export Import bank, we can also leverage [French export credit agency] Coface in Europe. And we have also worked with the Export Development Bank Canada,” says Anis.

The president also points to the company’s localisation drive, which aims to provide training to both its own employees and that of its customers, promotes R&D in the region, and enhances the company’s service capabilities.

“Its an important piece that we feel many of our customers are looking for, and it is a competitive advantage in terms being able to react quicker to our customer needs,” says Anis.

An example of this is GE’s Energy Manufacturing Technology Centre, currently being built in Damman, Saudi Arabia. The $100 million investment will be inaugurated this year, and will house repair facilities and a training centre that will provide technology and managerial courses.

In a region in need of more trained manpower, such measures appear sensible. Apart from training its own staff, handing sharing knowledge and experience with customers of senior level is important, says Anis.

“There is the executive side, where we partnered with our customers in doing tailored executive training. We’ll give them a best practice session and show them how GE manages its human resources, for example.”

Diversification drive
To enhance their energy security, Middle Eastern countries have begun working towards a greater diversification of their power supply.

While few countries have set themselves targets to abide by, significant investments in renewable energy, primarily solar, are imminent, and nuclear power is high on the agenda across the region.

Anis is aware of this trend, and believes that the company is prepared to meet a more the demand for more varied set of generation equipment: “Across the region there are abundant resources of fuel, and each country has its own strategy, which it keeps close to its chest, but I would say that each government will look at their forecast and you are seeing the diversification of generation play into that in terms of their planning. GE is well positioned to feed into what we think is important for every customer in every country.”

He feels that apart from focusing on alternative sources of energy, utilities looking to ensure an adequate supply should look at minimising waste by inceasing efficiency. And with renewable energy increasingly entering power grids, efficiency has to be augmented by technology and products allowing for flexibility.

“The other piece of it is focusing on the efficiency and how do you optimise your overall generation and grid, because as you add more of these diversified generations onto your grid you need to be more flexible in how you manage it,”
says Anis. GE, which has long been active in the nuclear field, is watching this space with interest.

So far, only the UAE emirate Abu Dhabi has actually committed itself to a programme, awarding a $20 billion contract to build four nuclear reactors to the Korean power company KEPCO. The tender was awarded in 2009, and all four reactors will be complete by 2020.

In December 2010, US companies Lightbridge and Excelon were tasked to consult the GCC member states on the feasibility of nuclear power. Since then, Saudi Arabia has given strong indication that it will enter the nuclear sphere, and Egypt has said it will tender for its first nuclear project towards the end of the year.

The company will be bidding for any tenders in the region, says Anis. “We’re working with every government in terms of their plans for safe nuclear generation programmes, and we’ll participate accordingly. As each government announces their plans we’ll work with them.”

Smartening up
With utilities keen to diversify their power mix and manage consumption, the smart grid has become a buzzword in the industry. Future grids, need to be able to respond to quick changes in the load, as renewable power is an unreliable source, dependent on weather and time of day.

Power providers are desperate to shave megawatts of the peak load, or, in other words, to reduce the consumption of electricity during the peak hours by incentivising use at other times. To achieve this, tariffs must be altered, and both provider and consumer must be able to assess usage in near real time.

“If you sit down and talk to each of the governments, you will realise that that’s a big focus for them, and summer demand is usually the peak and the crux of that challenge,” says Anis.

“It’s a continuously evolving puzzle, because as the region continues to grow, there’s expansion in industry and in investment. Parts of the region are even expanding domestically, so there is more purchasing power. Governments are focused on meeting both of those dynamics.”

GE can feed into the demand for smarter products, by selling smart meters, for instance, which allow for a detailed and timely reading of consumption. Anis, who sees smart grids primarily as an issue relating to demand, also identifies ways in which his company bring stability to the grid on the generation side.

“As renewables come onto the grid, they can also drop off very quickly, so you will have to be able to react and have the ability to generate electricity very quickly to offset that if needed. With an aero-derivative based gas turbine, for example, the start-up time in bringing that power onto the grid can be very short. I think GE is balanced nicely to provide solutions on both sides,” he says.

The company have yet to win contracts for smart grid solutions on the demand side, but Anis is confident that GE will enter the market soon. “There is nothing that I can announce, but there is encouraging interest that we are seeing across the region, and which is fairly consistent.”

IPP opportunities
Governments in the Middle East have long turned to public private partnerships (PPPs) to increase their country’s power generation capacity.

Independent power projects (IPPs) which are often part owned by the government, and part owned by private companies, are a different sort of customer to state-owned utilities.

More narrow in their focus, and needing to present their financiers with a long term concept, they are likely to outsource tasks such as servicing, often handing that business to the original equipment manufacturers (OEMs) such as GE under long term service agreements (LTSA).

But such agreements are not confined to IPPs, says Anis. “You can see utilities doing the same. Certainly as they get into the more advanced technology, we see the need there as well from utility customers for long term service
solutions.”

An example of this is the $2.65 billion contract GE was awarded by Kuwait’s Ministry of Electrcity and Water to provide combined cycle power generation equipment for a 2,000MW plant in Sabiya, (see key projects) where the deal included a seven year LTSA.

Whatever the customer, and whatever their changing needs may be, it is fair to assume that GE, which has been supplying the energy industry in the Middle East since the 1930, will be there to supply them in future.

GE Energy’s water business
Despite its name, GE Energy is no less committed to water solutions than to power generation, says Anis: “When you look at the region, the demand is working in tandem between power and water, so we’re focused on both.”

The division’s water business is split into two tracks, says the president, one centering around equipment that can purifies and cleans water, both in desalination or in wastewater reuse.

The other area of focus is around chemicals. “There are solutions around the industrial sector or industrial space, whether it is in petrochemicals or in oil and gas, or even in the utilities space where they need chemicals to treat water around the power generation,” says Anis.

GE Energy Key Projects
GE has an installed base of more than 1,000 turbines in the Middle East, providing more than 70GW of power. Some of the most notable recent contract wins include:

Sabiya power plant, Kuwait
In September 2009, Kuwait’s Ministry of Electricity and Water signed a turnkey contract with GE Energy and Hyundai Heavy Industries totaling $2.65 billion for a new, 2,000 MW power plant in Sabiya, set to become the largest combined cycle power plant in the country.

The plant will add much needed power to the grid, allowing Kuwait to boost electricity production to help meet growing demand and avoid future power shortages. GE Energy will supply three combined-cycle power blocks, including six Frame 9FA gas turbines, equipped with the latest emission reducing technology.

GE also will operate and maintain the plant for seven years from the commercial operation date.

PP10 power plant, Riyadh, Saudi Arabia
GE Energy won a contract for nearly $1 billion to supply more than 30 Frame 7EA gas turbines for the Saudi Electricity Company’s (SEC) Riyadh Power Plant 10 (PP10) in February 2009.

The project will add 2,000MW of much needed power to help support the region’s dynamic economic and population growth. The PP10 project addresses energy shortages during the summer months and when completed, will increase the the power capacity in SEC’s Central Operating Area by 20 per cent, helping to improve the reliability and delivery of power to SEC’s customers.

The PP10 agreement brings GE’s orders for SEC projects to nearly $2.5 billion in the last three years. In the last five years, GE has received commitments to supply 115 gas turbines for SEC projects.

MoU for developing water treatment capacities in Saudi Arabia
As Saudi Arabia faces an increasing demand for water to support its rapid population and economic growth, GE signed a Memorandum of Understanding (MOU) with Miahona, a subsidiary of ACWA Holding in October 2010.

The aim of the MoU is to sustain a reliable water supply and meet wastewater management requirements.

Combining GE’s global water technology experience and expertise with Miahona’s established local presence and knowledge of regional water needs, the MOU provides a framework for promoting the use of advanced membrane technology such as Membrane Bioreactors in water reuse and the pursuit of wastewater treatment, wastewater reuse and zero liquid discharge projects in the Kingdom of Saudi Arabia.

Miahona and GE will also mutually cooperate on projects related to well injection utilising GE’s advanced increased oil recovery (IOR) and enhanced oil recovery (EOR) solutions.

GE taps Iraq’s potential
In December 2008, Iraq’s Ministry of Electricity awarded GE Energy contracts worth almost US$3 billion, the largest deal GE Energy had ever struck in the region.

The contract stipulated the supply of 56 heavy duty frame 9E multi-fuel gas turbines capable of generating 7,000 MW of electricity. The ministry struck a similar deal with Siemens, who supplied 16 gas turbines worth around $2,1 billion.

The generation equipment was much needed, as capacity at less than 6,000MW was acutely outstripped by demand estimated at around 10,000MW.

“Overall, there is tremendous need, they have a lot of work to be done in terms of their infrastructure, and we’re certainly working closely with supporting them,” says Anis.

GE have also been active in supplying private power providers, selling the Mass Global Investment Company three Frame 9E gas turbines and generators for the 375MW expansion of the Arbil Power Plant, located in Iraq’s Kurdistan region, in
December 2010.

“We are working very closely with the energy sector in general, we are supplying into the oil and gas space, and we are working on fuel oil treatment, providing chemicals that help in the fuel treatment,” adds Anis.

Joe Anis in Profile
Joe Anis, GE Energy’s president for the Middle East, was appointed as a GE Company Officer in August 2010. A 13-year GE veteran, Anis has lead GE Energy’s Middle East operation for several years.

He previously held the role of regional manager for Power Generation Sales in the Middle East and Africa, where he achieved strong growth for the Power Generation business across the region. Anis graduated from Syracuse University, NY, USA with a Bachelor of Arts Degree in Political Science. He is based in GE’s regional headquarters in Dubai, UAE.

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