‘Unstable’ gas supplies highlight potential energy crisis in Jordan
With ongoing disruptions costing the Kingdom millions of dollars - expecting to push the national energy bill to a record JD4 billion - industry experts say pressure is on for officials to find near-term solutions to what some are describing as an "energy crisis"
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While casting doubt over stability in Egypt, ongoing attacks on the Arab Gas Pipeline have put Jordan's drive for alternative energy sources at the front and centre of the public debate.
By severing gas supplies earlier this month, the seventh act of sabotage this year on the Arab Gas Pipeline exposed the weakness of Jordan's energy sector, which relies on Egyptian gas for over 80 percent of its electricity needs. Although Egyptian teams have completed repairs on the pipeline, supplies have yet to recover to pre-attack levels of 150 million cubic metres a day - half of the 300 million cubic metres required to keep the Kingdom's power plants operational. With ongoing disruptions costing the Kingdom millions of dollars - expecting to push the national energy bill to a record JD4 billion - industry experts say pressure is on for officials to find near-term solutions to what some are describing as an "energy crisis".
Traditional alternatives According to Ministry of Energy and Mineral Resources Secretary General Farouq Hiyari, officials in Amman are stepping up efforts to secure alternative energy sources, ranging from the import of natural gas from Iraq to the development of local resources. The ministry is entering talks with Qatari and Iraqi officials to secure the supply of natural and liquid gas to the Kingdom, he said, indicating that initial discussions have been "positive". "We are exerting all efforts to secure alternative energy sources as soon as possible, and we are exploring different markets," Hiyari added.
The ministry is also moving forward with plans to construct a liquid gas terminal in the Port of Aqaba by 2013, he said, with the selection of an international firm expected by early next year. Despite the push to secure new gas supplies, infrastructure requirements will prevent the country from benefiting from any agreement for at least two years, according to officials. "At this current stage we must continue to rely on Egyptian gas and oil reserves," Hiyari said. The Jordan Renewable Energy Society (JRES) - a non-profit organisation devoted to promoting alternative energy in the Kingdom - is urging that the country turn to wind and solar energy, which are projected to account for 7 percent of Jordan's energy mix within the next four years and 10 percent by the end of the decade. The Kingdom is home to several sites with wind speeds with the potential to generate up to 1,500 megawatts (MW) of electricity, while the southern region of Maan is home to some of the highest solar radiation rates in the world, according to JRES Secretary General Mohammed Taani.
Ziyad Jibril, head of the energy ministry's renewable energy department, said officials have plans in place for up to 2,000MW in solar and wind energy projects by the end of the decade, with 64 international firms expressing interest in various projects across the country. Taani believes the passage of the Renewable Energy and Energy Efficiency Law, which aims to streamline investment procedures and paves the way for citizens to sell electricity back to the national grid, would go a long way into breathing life into the alternative energy sector. "This legislation will place Jordan on the world renewable energy map," he said. Despite their "promising" potential, industry experts acknowledge that wind and solar power alone cannot cover the Kingdom's energy demand, some 2.8 gigawatts annually. "Renewable energy will play a major role, but it is not the total solution," Taani said. With the first renewable energy project, a 90MW wind farm, set to be operational by 2014, Jordan will not see the bulk of its renewable energy towards the latter half of the decade. "Jordanian renewable energy is on the way, but we can't switch overnight," Jibril said.
Oil shale Despite the focus on solar and wind power, the most attractive energy alternative for Jordan is oil shale, with the Kingdom housing the third largest reserves in the world, according to various estimates. With a host of projects stretching across the country, including plans for the world's second largest oil shale-fired thermal plant, the resource is expected to provide up to 20 percent of the Kingdom's energy needs within the next decade.
According to Henri Mikk, CEO of Eesti Energia subsidiary Jordan Oil Shale Energy Co., the Kingdom could "easily" follow in the footsteps of Estonia and become the second country in the world to rely on oil shale for the majority of its electricity needs. "Jordan has all the potential to become a world leader in oil shale," he told The Jordan Times. A series of projects is set to make available 37,000 tonnes of shale oil in the central region of Attarat by 2015, 15,000 tonnes in Karak by 2017, and develop thousands of tonnes in potential shale reserves along the Jordanian-Iraqi border.
According to the ministry, the resource is projected to be a major pillar of the Kingdom's electricity generation, with plans in place for 900MW shale-fired thermal power station in the southern region of Lejjun and a 700MW plant in the central region, set to be the second- and third-largest power plants in the world to rely on shale oil. "Jordanian oil shale will be more than an energy solution, it will be a domestic industry," Mikk said. Although the cost of electricity generated from oil shale is competitive with international fossil fuel prices, industry leaders admit that the resource will still be steeper than Egyptian gas, which Jordan has received at preferential prices since 2004. Oil shale will also be unable to meet the Kingdom's immediate energy needs: Infrastructure requirements, combined with the infeasibility of exporting shale oil, will prevent Jordan from harnessing the resource before 2016. "We are working to develop oil shale as soon as possible, but these projects take time," Hiyari said. Nuclear future? While increasing the burden on the Kingdom's power plants, the instability of Egyptian gas supplies has bolstered energy officials' support for the country's nuclear programme. Jordan Atomic Energy Commission Chairman and former energy minister Khaled Toukan stressed that with instability in the supply of Egyptian gas and volatility in the international oil market, time is running out for Amman to secure its energy independence. "This most recent attack proves that this is not a sustainable path and we need to seriously consider our alternatives," he said.
Energy officials highlight stable electricity prices - to be set over a 60-year period - and the presence of uranium reserves in Jordan as the strategic advantages of an energy source which has come under fire by activists and citizens in recent months due to safety concerns. Plans are in place to construct two 1,000MW reactors, nearly doubling the Kingdom's electricity generation capacity, by 2022. "The nuclear programme will be a Jordanian programme, and will not be held hostage to other countries' affairs or agendas," Toukan noted.
Construction costs remain an obstacle - various projections range between $5 and $10 billion per reactor - and the government's ability to secure financing from international credit agencies is a major factor in the country's nuclear power ambitions. Another outstanding concern is the impact of atomic energy on the national grid, currently incapable of handling loads above 3,000MW, and the feasibility of the country relying on two reactors for over 30 percent of its electricity generation. As long as the Kingdom must rely on energy imports, officials are adamant that the drive for the country's energy security will continue. "We will not stop until Jordan's energy comes from Jordan," Hiyari said.