MENA region to boost spending on power projects as demand grows
The Middle East and North African (MENA) countries are expected to pump nearly $250 billion into power projects over the next five years to expand generation capacity and meet the growing domestic demand.
The projects will be one of the main topics of discussion at the 11th Power-Gen Middle East conference which will be held in Doha, Qatar, early this month.
Organizers said nearly 200 power projects are on the agenda of the February 4-6 conference which will also discuss new technologies and other power-related issues.
"Significant energy-related projects as part of the 200 planned and announced ventures valued between $100 million and $20 billion will be major points of discussion at Power-Gen in Doha," said the British PennWell Corporation, which is organising the event.
"A total of $250 billion is expected to be pumped into the power sector in the MENA region over the next five years to meet regional electricity demand growth."
The statement gave no breakdown for the investments but according to an official Arab group, the Gulf Cooperation Council (GCC) countries are expected to pump more than $63 billion into electricity projects over the next five years to expand their power generation capacity to meet growing domestic demand.
The six countries, which control 40 per cent of the world's recoverable oil resources, will add nearly half the expected additional power generation capacity in the region, said a study by the Dammam-based Arab Petroleum Investment Corp (Apicorp).
It estimated the total capital in power generation in MENA at $147.5 billion during 2013-2017 to add about 123.9 GW of electricity while the rest could cover water projects.
"A regional breakdown shows that about 43 per cent of that expansion in MENA is expected in the GCC, which remains the fastest growing area. This should come as no surprise, taking into account its record rates of urbanization and the massive requirements for water desalination and air conditioning."
The study put investments in power projects at around $63.1 billion in the GCC, $36.8 billion in Mashreq (east) Arab nations, $21.4 billion in Iran, $14.6 billion in Maghreb Arab countries and nearly $2.3 billion in other Arab nations.
It said that as a result of high population growth, record levels of urbanization, sustained economic growth and pressing needs for air conditioning and sea water desalination, many countries in the region have been struggling to meet demand.
In a separate study, Apicorp said the GCC is projected to record the highest power demand growth of around 8.5 per cent in the region in the medium term.
It put growth at 7.6 per cent in Mashreq (Egypt, Iraq, Jordan, Lebanon and Syria), 7.2 per cent in other Arab states, seven per cent in Iran and 6.5 per cent in Maghreb (Algeria, Libya, Mauritania, Morocco and Tunisia).
- One's catastrophe, another's celebration: Middle East's oil importing states benefiting lower oil prices
- Reading the signs behind plummeting oil prices: Saudi-led price war or simple supply and demand?
- Wishful thinking: is Saudi Arabia slowly, but maturely, winning the global oil price war against the US?
- It came much, much sooner than expected: a new era of oil abundance might just be in the making
- Not Iraq, not Iran: when it comes to oil rivalry Saudi Arabia's biggest contender is right next door