Oman Country Focus
With power and water demand rising, Oman's utilities show potential
Take a quick look through our Middle East Top 20 Utilities Projects this month and you’ll find three Omani projects valued at a combined $5 billion. For a population of around only three million that represents a considerable investment, and yet is unsurprising when you consider the latest projected growth figures in power and water requirements.
Oman Power and Water Procurement Company (OPWP) has forecast peak electricity demand on Oman’s Main Interconnected System (MIS) to grow by an average 8% per year until 2018. This represents a significant increase from 3845 MW last year, to 6582 MW in 2018. The Salalah system will see even higher yearly growth, with forecast demand growing 10% per year over the same period.
On the water demand side the situation looks similarly challenging. Desalinated water demand outside of Salalah is predicted to increase at a rate of 5% per year until 2018, rising to a total 269 million cubic metres. Within Salalah growth is again higher at 6% per year, though demand is likely to be met by the commissioning of the Salalah IWPP plant this year.
With demand figures so considerable there is a clear need driving current project s, as well as a further $2.9 billion of investment expected to be announced at the Oman Power and Water Summit this month. Electricity supply problems are a real concern and current power plans have already seen OPWP enter into an agreement to procure 300 MW of temporary capacity from Sohar Aluminium to cover a possible shortfall over this summer’s demand peak.
The $2 billion Sur IPP is expected to contribute significantly to meeting Oman’s future energy needs, producing 2,000 MW of power when operational in 2014. The plant, alongside other power projects set to come on line soon, is said to give a significant efficiency boost in terms of gas utilisation and is expected to actually reduce total fuel consumption over 2012 levels.
Elsewhere, the Salalah IWPP facility is nearing completion and is scheduled to be connected to the grid this year. This $1 billion plant will have a capacity of 445 MW, and a desalination output of 15 million gallons per day. A second plant at the site is then planned to be added to the system in 2016.
In the renewable energy arena, Oman’s Rural Areas Electricity Authority reported earlier this year that they had undertaken six renewable energy pilots, partnering with private sector developers. The projects ranged from 200 KW to 3.5 MW, using solar and wind technologies. Two 3 MW wind-power projects are being built at Masirah and Thumrait, with a 3 MW solar plant set to be constructed in Haima in Wusta Governate.
OPWP has stated that, subject to Government approval, it is aiming to procure close to 200 MW of solar generation capacity to be in service by the end of 2015. This additional capacity is expected to substitute between 1 and 2% of the MIS energy that would otherwise be generated with gas. This project had an initial projected cost of $1 billion, though OPWP have earlier stated they hope costs will fall to around $600 million.
Another promising development in January was an announcement from Terra Nex Engineering that it has plans for a $2bn project to develop solar power resources in the Sultanate. Together with Middle East Best Select (MEBS) Group of Funds, the company is seeking to generate around 400 MW of power and will build locally based plants to manufacture the solar panels and frames required.
Wind power has seen less movement and seemingly shown less promise. An OPWP study last year suggested that a wind farm sited at Thumrait in southern Oman had ‘shown potential as a resource option’ but might require a subsidy. The 20 MW wind farm is likely to be the subject of further study, with the additional capacity not deemed strictly necessary to meet the Salalah System’s requirements.
Looking at the outlook for water, desalination specialists Modern Water suggest that Oman’s focus on private sector involvement with infrastructure development also extends to the water sector. Managing director of the company’s Advanced Membrane Processes division Roger Webster states that “the Omani Government has committed several billion dollars’ worth of further investment over the next five years to continue the development of infrastructure to provide desalinated water to many towns and villages in the country”.
“With 2,092 kilometres of coastline running from the mouth of the Gulf in the north to the border with Yemen in the south, Oman provides Modern Water with multiple opportunities to develop and implement projects using its innovative desalination technologies both now and in the future.”
The company has built, and is developing, a range of projects around Oman. It has, for example, installed and operated the world’s first evaporative cooling system fed by Forward Osmosis-treated seawater in Oman’s port city Sohar. Webster says this plant has shown that the process can reduce operating expenditure by 50% compared with a cooling system supplied by Sea Water Reverse Osmosis.
“In June 2011, we were also awarded a contract to build and operate a 200 m3/day Forward Osmosis desalination plant for the Public Authority for Electricity and Water (PAEW) at Al Najdah, a community about 150 kilometres south of Al Khaluf. The plant Is currently nearing completion and is expected to be fully operational this summer.”
Future prospects also look bright, with Webster suggesting that discussions are ongoing at other sites around the country. “We’re looking particularly at sites with difficult challenges requiring robust and reliable operation in remote locations with difficult raw waters and very high salinity levels”.
OPWP is certainly anticipating the need for further water investment and highlights some areas in particular need. The “Sur Zone” covering the Ash Sharqiyah North and South Governates is named as requiring additional desalination capacity by 2017, and an announcement on specific plant requirements is expected later this year.
Nymphea Enivronnement area manager Michael Becker discusses prospects in Oman
What are Nymphea currently working on in Oman?
We’re offering two leading-edge technologies to the country. The first is our system for tapping undersea freshwater springs through a process that requires no energy and has no environmental impact. We also have a revolutionary trawling system for cleaning up pollution at sea. The system requires no training and can be deployed for large-scale emergencies or to combat everyday pollution.
What makes Oman attractive for your company?
Oman presents great potential for both our offerings. There are numerous undersea springs at a variety of locations within its territory which could be tapped. The country is also particularly exposed to oil spill risks due to the constantly increasing volume of maritime traffic and the major oil production infrastructure in the region.
How have Nymphea’s products been received?
The authorities’ desire to protect Oman’s exceptional environment has generated a natural interest in Nymphea Environnement’s products. The growing importance of tourism to the country’s economy has also increased the need for freshwater and the necessity of protecting the coastline.
How do you view future prospects for Nymphea in Oman?
We’re definitely seeking to increase our presence in the country and have therefore set up a regional representation office in the UAE. The placement of a team in Muscat is also being explored and should be a reality by the end of the year.