Infrastructure Middle East April 2015 by Infrastructure ME

ISSUE 014 | APRIL 2015

Improving service quality through network automation Across the world utilities are facing growing challenges to secure a stable, reliable and high performance distribution network to meet their customer’s future needs. Companies are under pressure to meet ever more stringent performance measures and have to balance this against increasing levels of demand for electricity. ANALYSIS

Enabling the Smart Grids of the future Managing this balance is a tough job, and Smart Grids are increasingly being seen as the way forward, providing the flexibility to release capacity and integrate renewable energy sources thereby allowing utilities to deliver a sustainable energy system. The introduction of network automation techniques helps companies achieve the necessary improvements in performance by providing real-time data on the status of networks so that operators have a clear picture at all times. This can be achieved through the installation of modular remote terminal units (RTUs), such as Lucy Electric’s latest generation Gemini 3, which can be installed on switching points and configured to transmit fault passage indicator (FPI) information to the network operator’s control centre. The improved network intelligence allows companies to introduce remote monitoring and switching points on their distribution feeders, and allows for the effective isolation of the network so that, should a fault occur, power can be restored to as many customers, as quickly as possible, reducing the duration of the system downtime. It also allows companies to effectively plan proactive maintenance and management of the network, reducing the risk of faults occurring in the first place. Lucy Electric has a range of ‘automation ready’ RMUs, which have all the necessary wiring looms for control of ring switches pre-installed. These provide a first stage investment in automation for companies looking for fast and effective upgrade paths. Alternatively the newly launched Aegis Plus, our next generation Smart Grid ready RMUs, incorporate a pre-integrated RTU and automatic transfer scheme (ATS). As experience in designing and implementing network automation projects grows, using traditional centralised control system architectures, and greater intelligence at plant levels adds to the knowledge and experience within the industry, approaches to control system design are developing.

0/ "OX s *EBEL !LI s $UBAI s 5NITED !RAB %MIRATES T: +97 148 129 999 F: +97 148 129 900 E: salesme@lucyelectric.com

TRANSPORT

Consolidation trend M&A wave in the chemicals industry

Ruling the crossroads The port-freezone combo advantage

p18

p46

CITIES Aegis Plus

Gemini 3

Find out more about our Aegis Plus range and our next generation Gemini 3 RTUs at the Lucy Electric stand GSP-7, at WETEX, 21 – 23 April 2015.

CONSTRUCTION

Connected things Revenue opportunities in smart cities

Making the grade Construction industry raises the bar

p40

p50

You can also hear one of our automation experts explain the challenges and benefits of automation system design at a seminar held on [time/date].

New approaches include area-based control systems, whereby the distribution network is divided into smaller regions with a co-ordinated control. This provides an advanced form of network management bringing the automated decision making and control closer to the plant, but still maintaining the benefits of a wider system view. With a huge depth of experience in designing and implementing automation projects the team at Lucy Electric work closely with our customers to ensure that their specific challenges and needs are met. The team can provide support from end-to-end project design to specifying product and providing post-installation training and support. Our full range of modular automation solutions includes retrofit and automation-ready equipment to deliver these projects in the most efficient and cost effective way possible.

DISTRIBUTED ENERGY

POWER PLANTS ON THE ROOF After cracking the utility solar PV puzzle, Dubai sets its eyes on rooftop solar

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INTRODUCTION

Solar gets traction GROUP GROUP CHAIRMAN AND FOUNDER DOMINIC DE SOUSA GROUP CEO NADEEM HOOD GROUP COO GINA O’HARA EDITORIAL EDITOR ANOOP K MENON anoop.menon@cpimediagroup.com +971 4 440 9152 ADVERTISING COMMERCIAL DIRECTOR JUDE SLANN jude.slann@cpimediagroup.com ++971 4 440 9114 SALES EXECUTIVE LARA GAMBARDELLA lara.gambardella@cpimediagroup.com +971 4 440 9127 MARKETING MARKETING MANAGER LISA JUSTICE lisa.justice@cpimediagroup.com +971 4 375 5498 DESIGN HEAD OF DESIGN GLENN ROXAS DESIGNER JOHN MAGNO CIRCULATION AND PRODUCTION DATABASE AND CIRCULATION MANAGER RAJEESH NAIR rajeesh.nair@cpimediagroup.com +971 4 4409142 PRODUCTION MANAGER JAMES THARIAN james.tharian@cpimediagroup.com +971 4 440 9136 DIGITAL

y formally launching the Gulf region’s ﬁrst-ever rooftop solar initiative, as part of a Distributed Renewable Resources Generation programme, Dubai is hoping that rooftop solar will play a crucial role in meeting the ambitious renewables energy target it has set for itself – 15% of the energy mix by 2030. In fact, the energy mix was re-worked in January this year, after the award of Phase 2 of Mohammed bin Rashid Al Maktoum Solar Park. The second phase, a 200MW solar photovoltaic (PV) project based on the Independent Power Producer (IPP) model, set a global milestone for utility-scale solar power generation with a Levelised Cost of Energy (LCOE) tariff of 5.84 USD cents/kWh. In the re-worked mix, renewable energy is placed second followed by nuclear and coal whereas in the old scenario, renewable energy and nuclear energy shared the podium at 12% each. According to MEED Projects, the introduction of higher tariffs in early 2008 saved Dubai at least $2bn by ensuring it has not had to award new power and desalination facilities in the ensuing period. I believe that the Distributed Renewable Resources Generation programme could lead to a similar outcome. For example, there are technologies available to aggregate distributed renewable energy capacities to create virtual power plants. According to officials from the Dubai Electricity and Water Authority (DEWA), which is implementing the rooftop solar programme, the utility’s electricity distribution network can handle distributed energy penetration up to 2,600MW. At the risk of over-simplifying things a bit, one might add that DEWA will not only get 2,600MW of new capacity (which is a substantial number where conventional power plant capacities are concerned) but get paid for it as well. At the recent Clean Energy Business Council (CEBC) breakfast brieﬁng on the evolving role of distributed renewable energy in the region, one of the panellists pointed out that the UAE’s off-grid solar power capacity stands at 700-800MW. Among the seven emirates, only Dubai has a formal grid-connected rooftop solar programme but the existence of a substantial off-grid solar power capacity in the country could be regarded as proof of distributed renewable energy’s bright future.

DIGITAL SERVICE DIRECTOR TRISTAN TROY MAAGMA Published by

REGISTERED AT IMPZ PO BOX 13700, DUBAI, UAE TEL: +971 4 440 9100 FAX: +971 4 447 2409 WWW.CPIMEDIAGROUP.COM Printed by Printwell Printing press LLC

Anoop K Menon Editor Infrastructure Middle East anoop.menon@cpimediagroup.com

© Copyright 2015 CPI. All rights reserved While the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.

April 2015

INFRASTRUCTURE MIDDLE EAST

CONTENTS

012 April 2015 28

COVER STORY

REGULARS

Power plant on the roof

06 Regional update

After cracking the utility solar puzzle, Dubai sets its eyes on rooftop solar

Oman to launch spot market for power

10 Sector update Brent to touch $60-70/barrel by year-end

15 Global update Egypt seals deals worth $36bn

16 In focus Fujairah’s global energy hub strategy TOP 10 FEATURE

KSA infrastructure projects Saudi Arabia’s plans to link foreign direct investment to infrastructure projects could propel the Middle East’s largest projects market to greater heights

21 Infrastructure tenders 38 Oil and Gas 40 Cities 53 Infra people 54 Executive Insight 55 Events 56 Infrastructure milestones This month: M station

INDUSTRY SECTORS

ANALYSIS

TRANSPORTATION

18 Consolidation in chemicals

46 Ruling the crossroads

Divestitures provide opportunity for Middle East chemicals companies to acquire international assets

Edwin Lammers, executive commercial manager of Sohar Port and Freezone on the beneﬁts of bundling ports and freezones

SPECIAL REPORT: WETEX 2015

TECHNOLOGY

32 Leading by example

48 Single version of truth

Dubai Electricity and Water Authority (DEWA) has a clear strategy to become a sustainable and innovative world-class utility

Implementation of Enterprise Resource Planning (ERP) enhanced Majis’ visibility and asset availability

TRANSPORTATION

CONSTRUCTION

42 Durable fibre

50 Making the grade

Synthetic ﬁbres are now proving their mettle as reinforcement substitutes in railway applications ALSO: Innovative Plastics

The GCC region’s construction industry is raising the bar with regard to project quality, delivery and sustainability

INFRASTRUCTURE MIDDLE EAST

April 2015

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2015 Seminar on Energy Efficiency & Energy Management 24 May 2015 Habtoor Grand Beach Resort Dubai Marina, UAE As the UAE continues to move towards a sustainable country, what initiatives in energy efficiency are being undertaken including the harnessing of renewable energy? And how is this being effectively managed? At the Infrastructure Middle East Seminar panels of speakers will be discussing RETAIL Building automation developments Innovations in technology Laws and scope for amendment Campaigns and initiatives Improving air quality Energy Saving case studies

HOSPITALITY Building Management Systems Energy saving through sensor technology and smart metering Controlled room automation Energy efficient lighting Energy saving case studies

ROOF TOP SOLAR The economics of rooftop solar Structural considerations Getting all stakeholders on-board Typical efficiency for panels

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Riot police called in over workers’ strike near Dubai Mall Police were called in during a rare pay dispute by employees of the Arabian Construction Company working on Emaar’s Fountain Views development.

EDITOR'S CHOICE

READERS' COMMENTS

Site visit: Hyatt Regency Dubai Creek Heights

Governments and company bosses can do all they like to ensure better ﬁre safety. But in the end it’s the onthe-ground employees that really matter – everyone from site managers to security guards in ﬁnished buildings. So there needs to be more safety training and awareness campaigns – as well as greater recognition of these workers.

Dubai Torch ﬁre: Façade materials called into question Doubts raised over the quality of the material used in 79-storey tower following dramatic ﬁre that left many residents temporarily homeless.

PHOTO GALLERIES

A look at Dubai’s latest five-star hotel as it prepared to open its doors to the public. See photo galleries at: meconstructionnews.com/photos

Dubai protest: Contractor “not obliged: to pay incentives Arabian Construction Company says “No one will be deported” after strike of estimated 200 workers.

Ahmed Abbas, Comment to the story, ‘Dubai Torch ﬁre: Were lessons from Tamweel incident heeded?’

Architect Chris Brown appointed Middle East design director at Woods Bagot Brown is a familiar face in the industry, with 21 years’ of experience in the UK, Hong Kong, the US and the Middle East.

Dubai property group offers free ﬂats to Torch ﬁre victims The First Group to provide 20 apartments as temporary accommodation for those left homeless after blaze on February 21.

READER POLL

What is the biggest challenge your company faces?

VIDEO

Watch the Liebherr L550 wheel loader in action An open day was held in Dubai to demonstrate Liebherr’s earthmoving equipment to prospective customers. See videos at: meconstructionnews.com/videos

20%

Cost of raw materials

Competence of sub-contractors

13% 60% Poor contract margins

Non-payment or slow payments

Log on for the latest from across the Middle East construction sector. Write to the editor at contact@meconstructionnews.com

IN FOCUS

April 2015

INFRASTRUCTURE MIDDLE EAST

REGIONAL UPDATE

UAE Dubai Municipality is pushing for affordable housing in the emirate and has allocated more than 100 hectares of land for the same. According to a report in Emirates 24|7, which quotes Abdulla Mohammed Rafia, Assistant Director General for Engineering and Planning Sector, Dubai Municipality, the civic body has defined affordable housing in Dubai as ‘living space for people whose salary is between AED 3,000 - AED10,000 per month.’ Another report in 7Days newspaper, quoting Rafia, said the municipality has sent a proposal to Dubai’s Executive Council that would ensure that 15-20% of a developer’s project is reserved for low earners.

Housing plan There is a huge pent up demand for affordable housing in the UAE

The Abu Dhabi Urban Planning Council (UPC) has approved 76 projects including major new developments in Al Ain and Al Gharbia. Plans for a major new tourist attraction in Al Ain featuring an African safari experience, botanical gardens and an amphitheatre have been given the green light.

The UPC has also approved a Master Plan for the use of industrial land surrounding Al Ain International Airport, with a focus on the aerospace industry. Mohamed Al Khadar, Executive Director, Urban Development & Estidama Sector, UPC, said the approved projects are aligned with the goals of Abu Dhabi Vision 2030.

Oman Oman is planning to introduce a spot market for electricity with the objective of enhancing efficiency within the sector, the Times of Oman reported. The proposed spot market is an alternative route for power producers to sell electricity to Oman Power and Water Procurement Company (OPWP) outside a long-term power purchase agreement (PPA). Independent power producers will be able to participate in the alternative market and receive prices determined on a day-to-day basis in accordance with speciﬁed market rules. OPWP has appointed John Mather, who has designed wholesale electricity markets in the UK and Australia, as project manager.

INFRASTRUCTURE MIDDLE EAST

Power trades Oman hopes to have a full-fledged spot market for electricity by 2020

OPWP is expected to issue a request for proposals to build the country’s largest Independent Power Project (IPP) soon, the Oman Daily Observer reported. The 2,600MW project (scalable to 3,200MW in the future), comprises of two gasﬁred power plants and associated facilities to be located at Ibri in Dhahirah Governorate and Sohar

April 2015

in Batinah North Governorate. The full capacity is expected to be commissioned and made available by April 1, 2018, although there is a requirement for the successful bidder to make available early power capacity of 700MW at the Ibri site by April 1, 2017. Ibri is tipped to host a major industrial park, as well as a mega logistics hub integrated with the Oman National Rail Project.

DP World Limited and its wholly owned subsidiary, DP World, have closed the $2.6bn acquisition of Economic Zones World (EZW) from Port and Free Zone World FZE (PFZW). EZW’s key asset is the Jebel Ali Free Zone, which is one of the largest free zones in the GCC. Sultan Ahmed bin Sulayem, Chairman of DP World, said: “We are pleased to have reached the close of this acquisition which is compelling from both a strategic and ﬁnancial perspective. Acquiring a strategically located asset integral to Jebel Ali’s continued success enhances our competitive advantage and aligns with our strategy of providing port-centric integrated logistics solutions at key gateway locations.”

The ministry of manpower is open to re-examining existing policies connected to Omanisation and expat labour. A Times of Oman report, quoting Sheikh Abdullah bin Nasser Al Bakri, Minister of Manpower, said the ministry is ﬂexible to “re-examining some of the policies related to Omanisation and the foreign workforce if the companies and factories can commit to identifying a mechanism to increase the number of Omani cadres in these institutions” agreed upon between the ministry and business owners. “The major challenges currently faced by the industrial sector are related to the Omanisation policy, which was developed by the government based on economic and social considerations,” said Al Bakri.

Bringing you Container Terminal 3 at Jebel Ali Port, Dubai 3 Worldâ&#x20AC;&#x2122;s largest semi-automated facility 3 Capacity of 4 million TEU, taking total capacity at Jebel Ali Port to 19 million TEU DP World, UAE Region P.O.Box 17000 Dubai Tel. +971 4 881 5555 marketing@dpworld.com www.dpworld.ae

3 19 automated quay cranes and 50 automated rail-mounted gantry cranes 3 Quay length of 1860 metres, 70 hectare storage yard and 17 metres depth

REGIONAL UPDATE

Kuwait Kuwait is set to award about $47.2bn worth of projects in 2015, almost double the value of contracts awarded in 2014, said a report by MEED Projects. The report estimated the total value of Kuwait’s projects market (planned and active projects) in the region of $212.60bn. Last year, the authorities introduced a new law to regulate all public private partnerships (PPP), replacing the Partnerships Technical Bureau (PTB) with the Kuwait Authority for Partnership Projects (KAPP), which has been vested with greater executive powers. The government has also reaffirmed its commitment to deliver on development projects in spite of the oil price decline.

Project notes Construction sector accounted for 24% of the contracts awarded in 2014

Kuwait has sought help from the International Monetary Fund (IMF) to introduce corporate taxes to shore up revenue in the wake of falling oil prices, said a KUNA report. Commerce and Industry Minister Abdulmohsen al-Mudej said the two sides discussed ways of introducing corporate taxes for Kuwaiti and foreign companies

after the recent introduction of a new corporate law. Kuwait currently imposes no taxes on local companies, citizens and expatriates but foreign ﬁrms are taxed 15%of their proﬁts. The country has stopped diesel, kerosene and aviation fuel subsidies and is considering similar measures for petrol, electricity and water.

Saudi Arabia Saudi Arabia’s cabinet has approved a proposal to tax undeveloped land in urban areas, a policy that could help to end a shortage of affordable homes and spur economic growth, said a Reuters report. But the proposal gave no details of the likely size of the tax. Urban land in the kingdom is owned by wealthy individuals or companies who prefer holding it as a store of value or trading it for speculative proﬁts instead of developing it. According to estimates, nearly 40-50% of the space in big cities such as Riyadh, Jeddah and Dammam is undeveloped. Lack of affordable housing has become a major social problem in the kingdom, and the tax could make more land available for home building.

INFRASTRUCTURE MIDDLE EAST

Artificial shortage Speculation on urban land has led to paucity of housing in cities

South Korea will develop and supply two small-sized nuclear reactors for Saudi Arabia under a $2bn deal, said a Korea IT Times report. The nuclear deal was part of the 14 memorandums signed by the visiting South Korean President Park Geun-hye and Saudi King Salman bin Abdulaziz Al Saud last month. Under the terms of the deal, the Korean side will transfer

April 2015

technology for the ‘smart’ nuclear reactor about the size of 100MW and build two reactors for Saudi Arabia through a partnership between the Korea Atomic Energy Research Institute and King Abdullah City for Atomic and Renewable Energy. The kingdom has also entered into a joint venture with Invap of Argentina to develop its nuclear energy programme.

Ahmad Khaled Ahmad Al Jassar has been appointed as Kuwait’s new Water and Electricity Minister. His predecessor Abdulaziz al-Ibrahim resigned following questions raised by Kuwait’s parliament about the widespread blackout experienced by the country on February 11. At the time, Ibrahim had attributed the outage to a technical failure at a power station. KUNA quoted Ibrahim as saying that a ﬁle on an investigation into the power cut showing maintenance shortfalls had been referred to the cabinet and the country’s parliament and subsequently, transferred to the public prosecutor. Ibrahim indirectly accused some lawmakers of accepting bribes to grill him, which sparked an uproar in the parliament and led to calls for his resignation.

Taking advantage of favourable market conditions, Saudi Aramco has signed a $10bn loan agreement with 27 financial institutions. The five-year financing comprised two tranches (i) an Islamic tranche denominated in Saudi Riyal (for an amount equivalent to $3bn) for Saudi banks and(ii) a $7bn international tranche. The cash replaces an existing $4bn five-year loan due to mature later this year. Part of the $10bn could be used by Aramco to acquire a stake in Lanxess’ tyre rubber business. Bank of China, BTMU, Citi, Deutsche, HSBC, JP Morgan, Standard Chartered and SMBC participated as Bookrunners and MLAs on the US dollar loans, whilst Alinma Bank, National Commercial Bank and Riyad Bank led the Riyal-denominated portion. UAE lenders participating included ADCB and NBAD.

REGIONAL UPDATE

Qatar Qatar remains fully committed to its currency peg to the US dollar and is not reviewing its currency policy. A Reuters report, quoting central bank governor Sheikh Abdullah bin Saud al-Thani said “this has been our policy for years and will stay the same.” Earlier this year Khalid Alkhater, the Qatar central bank’s director of research and monetary policy, said GCC economies might need to rethink their monetary policies and the long-term sustainability of their currency pegs to the dollar as Gulf and US economies diverged. However, GCC central bank governors from the UAE and Bahrain have ruled out any change to their pegs.

Slowing inflation Housing remains the main source of inflationary pressures

Inﬂation in Qatar expected to remain low, even as pressures exist in the housing sector, according to the Institute of International Finance (IIF). Inﬂation is expected to decline to an average of 2.4% in 2015 from 3% in 2014 and remains close to the GCC average. The housing category, with the largest weight in the consumer

price index, is the main source of inﬂation despite the introduction of new properties, suggesting demand may outstrip supply. According to the IIF report, the potential increase in interest rates in the US are expected to be matched, albeit with a delay of possibly several months given some differential in the policy rates.

As global LNG supply becomes more competitive, Qatar’s ability to maximise revenues by diverting volumes between Asia and Europe could be undermined, said a study by Columbia University’s Centre on Global Energy Policy. According to the report The US Shale Gas Revolution and its Impact on Qatar’s Position in Gas Markets, the placement of progressively more LNG at spot or hub prices could result in a fall in annual revenue from $56.5bn in 2013 to $37bn in 2026, before recovering to $45.5bn by 2030. Should Qatar decide to lift the moratorium on North Field, it may beneﬁt from waiting through the 2018–23 “soft market” or force competitors into deferring projects by announcing a ﬁrm intent to bring in new volumes as soon as possible, after lifting of the moratorium.

FINISHED PRODUCT SALES HOSE & BELT MANAGEMENT HYDRAULIC TUBING & PIPING GATES ENGINEERING & SERVICES MENA Headquarters, Jebel Ali Free Zone Dubai, United Arab Emirates Telephone +971 4 886 1414 Fax +971 4 886 1413

HYDRAULIC SYSTEM REFURBISHMENT FLUID POWER EQUIPMENT DESIGN & BUILD mena@gates.com <> Gates.com

SECTOR UPDATE

Utilities Kuwait’s Ministry of Electricity and Water (MEW) has awarded ABB a $12m contract to refurbish and upgrade three existing substations. The three transmission substations, located in Hawalli Governorate and providing power to residential and commercial areas around Kuwait Bay have completed 30 years of operation. The project scope includes refurbishment of 132kV GIS circuit breakers, overhaul of disconnectors and earthing switches, replacement of control cables and upgrading of control panels as well as integration of the new equipment for 33 bays with the existing automation systems. The entire project is scheduled for completion in 2018.

Milestone project DEWA has signed a 25-year PPA for phase 2 of the solar park

Dubai Electricity and Water Authority (DEWA) has signed a Power Purchase Agreement (PPA) and a Shareholder Agreement for the second phase 200MW solar photovoltaic plant at the Mohammed bin Rashid Al Maktoum Solar Park. The agreement was signed between HE Saeed Mohammed

Al Tayer, MD & CEO of DEWA and Mohammad A Abunayyan, Chairman of ACWA Power and representative of the ACWA Power and TSK consortium. Phase 2 is based on the Independent Power Producer (IPP) model and will be operational by April 2017. ACWA Power will ﬁnance, build and operate the plant and will receive a 25-year PPA starting in 2017.

Oil & Gas According to the industry survey conducted at The Gulf Intelligence Doha Energy Forum, brent crude oil prices are expected to trade in the $60-70-a-barrel price range by the end of 2015. The survey also found that 33% of respondents expected International Oil Companies (IOCs) to maintain production targets through greater operational efficiency even with lower capital expenditure, despite low oil prices and the resulting volatility on the development of new energy capacity over the short to mid-term. Also, as many as 29% of those surveyed thought that prices and volatility would cause US shale oil producers to stop new capacity additions.

INFRASTRUCTURE MIDDLE EAST

KSA focus GE will invest $100m in new research and manufacturing programmes

GE will expand its oil and gas manufacturing capacity in Dammam to include wellheads, ‘Christmas Trees’ and other Pressure Control technologies and performance services repair capability for submersible pumps. On the research front, the focus will be on new software solutions as well as the next-generation of down-

April 2015

hole technology and Electric Submersible Pump (ESP). The research will aim to advance corrosion monitoring and resistance technologies to better withstand high sour-gas environments prevalent in Saudi Arabia’s oil and gas ﬁelds. These are part of GE’s recently unveiled plans to invest $100m in new research and manufacturing programmes in the kingdom.

Empower has completed phase one of Dubai Design District’s (d3) district cooling network. The ﬁrst phase’s capacity stands at 10,000 Refrigeration Tonnes (RT), while the total capacity envisaged for the project is 120,000 RT. When completed, the $204.20m project is expected to boost the district cooling company’s portfolio by 12%. “With the rapid commissioning of d3’s district cooling systems, we at Empower have demonstrated our commitment to providing world-class support to Dubai’s ever-growing roster of real estate developments,” said HE Ahmad Bin Shafar, CEO, Empower, which currently operates over a 1,000,000 RT portfolio across 62 plant rooms in Dubai.

Nearly 80% of the GCC region’s major petrochemical and chemical producers have made innovation strategy a key business priority. According to a survey by Gulf Petrochemicals and Chemicals Association (GPCA), the number of companies that have formulated an explicit innovation strategy has doubled from 21% in 2010 to 41% in 2015. Also, 38% of the surveyed companies expect innovation to remain a priority for the next 10 years. The GCC’s chemical industry invested an estimated $367m on research and development (R&D) in 2013, a ﬁgure that is around 0.8% of global R&D investment. This year, the survey spoke to 24 manager-level or above executives in the Gulf, representing 70% of GPCA full member companies.

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www.megger.com

Power Transformers Current transformers Voltage transformers General AC insulation testing Resistance testing Circuit breakers Primary testing Protection relays

SECTOR UPDATE

Transport Thales has been chosen to provide Qatar’s new commercial port with an integrated security solution. A vital component of Qatar’s economic infrastructure, the New Port will comprise three container terminals with an eventual combined annual capacity in excess of 6m containers per year. To secure the new commercial port, Thales is to provide a high technology integrated solution managed by a security command and control centre to enable an integrated response to piracy, trafficking, smuggling and global threats of terrorism. This contract also marks the ﬁrst time Thales will deploy its technologies on such a large scale.

Electric bus trial RTA’s Dr Yousef Al Ali (Right) with Liberty’s Nihad Al Kilani (Left)

Emirates Transport (ET) and the French public transport group Keolis have signed a MoU to jointly bid for upcoming operation and maintenance tenders within the UAE public transport sector. Karim Chaiblaine, CEO of Keolis in the Middle East, said: “This is the ﬁrst step in a

long-standing and successful relationship. In particular, ET is very experienced in the operation and maintenance of heavy vehicles, and in sourcing and managing local suppliers and partners. Its deep knowledge of the local context will be essential in recruitment and training, particularly during critical phases such as mobilisation.”

Cities Smart homes and smart commercial buildings will represent 45% of total connected things in use in 2015, rising to 81% by 2020, said a Gartner report. The report estimated that 1.1bn connected things will be used by smart cities in 2015, rising to 9.7bn by 2020. “Smart cities represent a great revenue opportunity for technology and services providers (TSPs), but providers need to start to plan, engage and position their offerings now,” said Bettina Tratz-Ryan, research vice president at Gartner. Residents will lead the way by investing in smart-home solutions (More on Page 40), with the number of connected things used in smart homes to surpass 1bn units in 2017.

INFRASTRUCTURE MIDDLE EAST

Safer roads Atkins helped Abu Dhabi develop its pedestrian and bikeway master plan

According to Ian Machen, Associate Director, Atkins and a specialist in Intelligent Transport Systems, the region’s roads are set to become safer places for vulnerable users because of the integration of new technologies. “Government authorities in the UAE and Qatar, in particular, have developed advanced pedestrian and cycling strategies

April 2015

in recent years,” said Machen, while speaking at an ITS Forum in the UAE. Atkins helped develop Abu Dhabi’s pedestrian and bikeway masterplan. The creation of cycle friendly environments could typically entail layout changes to traffic light junctions where sensors will detect cyclists and allow them a head start before cars get the green light, explained Machen.

The Roads and Transport Authority (RTA) has signed a MoU with Liberty Automobiles under which the latter will provide an electricity-powered bus for trial for nine months. “Through this trial, the bus will be deployed as part of our bus ﬂeet at the cost of the company in order to assess the technical and operational performance of the bus as well as the efficiency of the electricallypowered bus operation,” said Dr Yousef Al Ali, CEO of RTA’s Public Transport Agency Liberty will cater to all costs covering the insurance, operation, branding, equipment, service, labour, spare parts, tyres, maintenance and the recharging during the trial run. It will also train RTA drivers before the deployment of the bus and maintain periodic follow-up of drivers during the experiment.

RTA’s Public Transport Agency announced will enforce ﬁnes against vehicles misusing the Bus and Taxi Only Lanes in Dubai. “The Order No (1) for 2010 regarding the use of dedicated lanes on Dubai streets has speciﬁed vehicles allowed to use these dedicated lanes as: public buses, taxis, police vehicles, civil defence vehicles, and ambulances serving emergency cases. Vehicles for individuals are only permitted to use these lanes to access or exit subsidiary streets,” said Dr Yousef Mohammed Al Ali, CEO of RTA’s Public Transport Agency. Dubai currently has approximately 8km of Bus and Taxi Only Lanes. The system aims to increase the share of public transit means in the movement of people and rather than private transport means and is applied in several cities across North America and Europe.

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SECTOR UPDATE

“Companies in this region have demonstrated a strong interest in technologies that boost the efficiency, quality and productivity of construction processes – from concept to completion and operation – where Trimble solutions play a major role.”

Construction Tamdeen Group has launched the Al Khiran development, which is spread across 350,000sqm of water front. Valued at $700m, the resort-style project forms the entertainment and commercial cornerstone of the new community at Sabah Al Ahmed Sea City and surrounding areas of over 200,000 people. Mohammed Jassim Khalid Al Marzouq, Chairman of Tamdeen Group said: “Kuwait is recognised as a country that has one of the world’s highest per capita income estimated at $48,260, which means the country is well-placed to drive growth across different retail segments. The completion rate in Phase 1 of the Dubai Water Canal project, which includes the construction of a bridge on the Sheikh Zayed Road comprising eight lanes in each direction, has hit 40%. The completion rate in Phase 2, which includes constructing bridges on Al Wasl and Jumeirah Roads, has reached 25% while the completion rate of Phase 3, which includes constructing a 3 km-long canal connecting the Business Bay Canal with the Arabian Gulf, has hit 15%. Phase 3 also includes building the canal sides, three pedestrian bridges linking the two sides of the canal and four marine transit stations. SIKA UAE has recently opened a new mortar manufacturing facility at its existing production site in Dubai Investment Park. The facility at DIP has been producing a range of concrete admixtures, additives and compounds since 2008, and the new powder plant will

INFRASTRUCTURE MIDDLE EAST

Al Khiran Masterplan The development is expected to boost Kuwait’s tourism profile

satisfy the growing demands of the construction industry in the Southern Gulf for building adhesives, high-performance grouts and repair mortars. Now fully operational, the plant has an initial capacity of 24,000 tonnes per annum and will complement production in Sika’s existing powder plants in Bahrain and Saudi Arabia. Ashraf Wahib, General Manager for Sika Southern Gulf said the new plant represents another step in Sika’s expansion in the region. Ajman’s premier waterfront development project, Al Zorah has invested over $136.14m in infrastructure, with the awarding of a $31.31m contract for the ﬁnal stage of Phase 1 infrastructure works. With the initial stages of infrastructure development already completed, the new contract to

AIMS Group covers the rest of the road and utility networks to support all Phase 1 components. The ﬁrst phase of the $540m development will welcome its ﬁrst residents later this year. Trimble has expanded its operations in Dubai to address growing construction activity in the GCC region. Trimble’s new Dubai office will enhance the company’s collaboration with regional stakeholders, enabling the company to expand service, support and training for customers in the region, such as Kerzner International, and AECOM across the Middle East; Qatar Project Management (QPM) and Qatari Diar in Qatar; and Tatweer Building Construction in the Kingdom of Saudi Arabia, among others.. Steven W Berglund, Trimble’s president and CEO said:

Al Zorah progress Phase 1 final contract will be completed in the fourth quarter

April 2015

The Roads and Transport Authority (RTA) has launched the Building Information Modeling (BIM) project with the aim of nurturing an engineering information environment. “This project offers a kind of platform for broadening the scope of modeling the information of RTA’s facilities to cover all construction projects relating to RTA’s infrastructure such as service stations, operational offices, road networks and rail systems,” said Abdullah Ali Al Madani, CEO of Corporate Technical Support Services Sector at the RTA. “The building information modeling project comprises a series of processes aimed at creating, saving, and following changes as well as retrieving information about a construction project during the project’s lifecycle,” added Al Madani. AECOM has launched AECOM Academy in Saudi Arabia to train and invest in the kingdom’s national workforce. Funded entirely by AECOM, the academy will deliver training, professional development and internships to equip graduates with the technical skills and business acumen required to deliver complex infrastructure projects in the kingdom. Around 140 graduates have enrolled in the three-year programme, including 20 female students. AECOM, which has been in operating in Saudi Arabia for more than 40 years, aims to have around 50% of its workforce in the Kingdom. comprise Saudi nationals by 2017.

GLOBAL UPDATE

Round Up Egypt signed investment deals worth $36bn at the international investment conference in Sharm al-Sheikh. In addition, deals worth $18.6bn for EPC contracts and loans totalling $5.2bn were signed. The UAE, Kuwait, and the Saudi government each pledged to give Egypt $4bn in aid to help secure and develop its economy bringing the total investments and central bank deposits by the three GCC countries to $12bn. Egypt’s President Abdel Fattah al-Sisi closed the conference inviting further investment, emphasising that Egypt needs up to $300bn to reach its full potential. About 50 countries have expressed intention to become members of the Asian Infrastructure Investment Bank (AIIB), which includes 14 advanced economies of the G20. The key G20 countries joining the Beijing-headquartered AIIB include the UK, Brazil, France, Germany, South Korea, India and Australia. Only Japan and the US have decided not to join the bank. However, US Treasury Secretary Jacob Lew said that Washington was “ready to welcome” the China-led AIIB. The authorised capital of AIIB is $100bn and the initial subscribed capital is expected to be around $50bn. Metito has signed a concession agreement for a PublicPrivate- Partnership (PPP) water project worth $75m with the government of Rwanda to develop a new, sustainable bulk water supply plant in Kigali. On completion, the plant will

supply 40,000 m3/day of treated groundwater, which will be extracted from the south bank of the Nyabarongo River. The plant, to be completed in two years, will meet 40% of Kigali city’s potable water requirements. Through this PPP arrangement, which is set for 27 years, Metito will be responsible for the ﬁnancing, design, construction, operation and maintenance of the treatment plant, and forwarding infrastructure including transmission pipelines to three storage reservoirs. According to a new report by Timetric’s Construction Intelligence Centre (CIC), Africa leads in renewable energy projects investment in the Middle East and Africa. Timetric estimates that of the $717bn of power generation projects planned or underway in the 21 countries studied, African countries account for $413bn or over 57% of the total value. Although Nigeria leads the 21 countries surveyed for value of gas power generation projects and is second to South Africa for coal power projects, the government’s strategy is focusing on switching to renewable sources. ABB and Samsung SDI have joined forces to develop microgrids globally. The two companies will establish a global commercial alliance to develop and market modular and scalable microgrid solutions, utilising lithium-ion batteries for energy storage. “ABB is very pleased to sign this MoU with Samsung SDI Microgrid applications are expanding rapidly, both in emerging and developed markets, and are a key growth area in ABB’s Next Level strategy,” said ABB CEO Ulrich Spiesshofer.

www.hi-force.com

www.hi-force.com January April2014 2015 INFRASTRUCTURE INFRASTRUCTURE MIDDLE MIDDLEEAST EAST 015 15

IN FOCUS

STRATEGIC LOCATION

Energy opportunities Fujairah is positioning itself to become as a leading global energy hub to service Asia ujairah, the only UAE emirate located on the coast of the Arabian Sea, has established itself as a leading bunkering and storage centre, strategically positioned at the crossroads of a new energy corridor opening up East of Suez to Asia. As global energy production and consumption centres are shifting, Fujairah is transforming into a major platform for local, regional and international companies seeking to expand their footprint into other parts of the world, according to a Gulf Intelligence special report on Fujairah. “Over the past decade, Fujairah has experienced tremendous growth. Notably in 2012, the Abu Dhabi Crude Oil Pipeline came on stream – providing Abu Dhabi with an export outlet for crude from the Habshan field via Fujairah. In addition, Fujairah is currently planning refining, petrochemical and LNG regasification facilities for the future,” said HH Sheikh Saleh Bin Mohammed Bin Hamad Al Sharqi, Chairman of the Department of Industry and Economy, Fujairah and Chairman of the Board of Port of Fujairah, in the report Fujairah: an Emerging Hub on the South-South Energy Trading Corridor. The Habshan-Fujairah crude oil pipeline cuts down travel times for tankers that would otherwise have to sail through the narrow and busy Strait of Hormuz to load their cargo. More importantly, the arrival of as many as 1.5m bpd of crude oil in Fujairah has enabled the emirate to develop the local energy value chain by building storage and blending facilities, with refining and

INFRASTRUCTURE MIDDLE EAST

April 2015

petrochemical projects in the planning phases. In addition, Fujairah is home to one of the country’s largest power and water desalination plants, which receives natural gas feedstock via the Dolphin pipeline linking Qatar and the UAE. “On a global level, the importance of strategic pipelines and storage in key locations such as Fujairah is becoming even more important at times of increased geopolitical instability,” he continued. “It should therefore not come as a surprise to anyone that new crude and product storage will continue to open in Fujairah in coming years. After all, pipelines and storage facilities are crucial to keeping the world’s economic engine running, ensuring perennial access to much needed oil and gas supplies, and providing long-term supply and demand security for both energy producers and consumers.” Last month, Vopak Horizon Fujairah, a joint venture between Royal Vopak, Horizon

“On a global level, the importance of strategic pipelines and storage in key locations such as Fujairah is becoming even more important at times of increased geopolitical instability” HH SHEIKH SALEH BIN MOHAMMED BIN HAMAD AL SHARQI, CHAIRMAN OF THE DEPARTMENT OF INDUSTRY AND ECONOMY, FUJAIRAH AND CHAIRMAN OF THE BOARD OF PORT OF FUJAIRAH

Terminals – wholly owned by Emirates National Oil Company (ENOC), the government of Fujairah and Kuwait’s Independent Petroleum Group, launched the seventh expansion phase of the Black Pearl project, intended to take the total storage capacity to 2.6m cubic metres. Vopak Horizon Fujairah is one of the world’s largest bunkering centres and the first independent onshore oil terminal outside the Arabian Gulf. The expansion will see five large storage tanks being installed for crude oil with completion scheduled for summer of 2016. The Black Pearl project is a cooperation between Vopak Horizon Fujairah and the Port of Fujairah. The expansion phase will also see the construction of a VLCC jetty for the world’s largest tankers, which will dock in the port. Fujairah is expected to benefit from the growth in the region’s refining capacity. According to some estimates, more than 20 new refineries or expansions to existing plants will be completed in the Middle East region by 2020, adding more than five million barrels a day to capacity. In the Gulf Intelligence report, Dave Ernsberger, Global Editorial Director for Oil, Platts, noted that refining development in the Middle East is following a strategic pattern, combining economic decisions to meet booming regional demand while carving out an export industry with political goals aimed at greater regional industrialisation and work force creation. According to Ernsberger, the regional drive towards extending down the value chain and taking advantage of the exports market could result in the development of a local spot market in Fujairah.

COVER STORY

March 2015

INFRASTRUCTURE MIDDLE EAST

ANALYSIS

M&A BUZZ

Consolidation in chemicals Divestitures provide opportunity for Middle East chemicals companies to acquire international assets

he global chemicals industry is expected to witness an increased number of mergers and acquisitions (M&A) in 2015, according to the fourth issue of the Chemicals Executive M&A Review by AT Kearney, a leading global management consulting ﬁrm. AT Kearney’s survey of chemical executives and members of the M&A community found that activist investors found are likely to drive the increase in deals, putting pressure on chemical majors to divest assets seen as underperforming. Especially in North America, activist investors have pushed for portfolio restructuring of large chemical companies with diversiﬁed portfolios such as Dow Chemical and DuPont. “Activist investors are putting pressure on the management of some of the most prominent chemical majors to streamline their business portfolio. So far this trend is most predominant in North America, but as a consequence of increasing fund sizes and a scarcity of underperforming assets in North America, we expect shareholder activism to

also grow in Europe and Asia,” said Joachim von Hoyningen-Huene, a partner at AT Kearney and co-author of the report. “The increased M&A activity we see in North America, specifically in the divestitures of non-performing or non-core assets of international players provides an opportunity to the large Middle Eastern chemical companies to acquire some of these assets,” said Ojas Wadivkar, Partner, AT Kearney Middle East. “Diversification and moving downstream is a critical imperative for GCC companies and these global developments provide an opportunity to get access to technologies and help these local companies move further in their diversification agendas. In some cases, it may also provide market access and market related knowledge, including formulation and technical assistance.” Since 2013, the deal value of chemicals mergers and acquisitions has increased by 13%. A total 60% of chemicals executives surveyed by AT Kearney see 2015 as the year of increased mergers and acquisitions. Clearly this is supported by the closing of the $6.9bn Albemarle Rockwood mega-deal in North America. However, the appetite for chemicals deals in Europe will short

term be depressed by current economic climate and political tensions with Russia. Commenting on the findings of the study, Thomas Rings, partner and co-author of the Chemicals M&A report, AT Kearney, said: “North America is projected to represent the main share of chemicals mergers and acquisitions in 2015. However, China will be the strongest growing region for chemicals M&A activity in 2015 with expected further consolidation of the local market as well as an increase in geographic expansion and inbound international investments in the critical Chinese market.” In the foreseeable future, strategic investors continue to form the backbone of M&A in the chemicals industry. Strategic investors are expected to drive chemical deals. The financial factors that will drive M&A in 2015 are healthy balance sheets of chemical companies, limited returns on organic investment opportunities and continued good access to financing. Key strategic reasons for growing M&A momentum are portfolio streamlining – also driven by activist investors, western chemical companies seeking access to faster growing emerging economies and vice versa, the resurgence of the chemical

“Diversification and moving downstream is a critical imperative for GCC companies and these global developments provide an opportunity to get access to technologies and move further in their agenda” OJAS WADIVKAR, PARTNER, AT KEARNEY MIDDLE EAST

INFRASTRUCTURE MIDDLE EAST

April 2015

ANALYSIS

industry in the US due to low cost feedstock and the continued high level of fragmentation of chemical markets in Asia. In addition AT Kearney foresees that the sharp drop in oil prices from Brent’s $115 high late June 2014 to a signiﬁcantly lower level of $50-60 is expected to have a ripple effect on petrochemicals players. Joachim von Hoyningen-Huene said: “With the current low oil price we expect oil companies to put chemical assets on the market to generate cash. This will create opportunities for chemicals companies interested in the oil industry to buy suitable assets for more reasonable multiples.” Meanwhile, petrochemicals production in the GCC rose by 4.5% in 2014, the second highest growth region in the world, according to the Gulf Petrochemicals and Chemicals Association’s (GPCA) Annual Report 2014. Regional growth in chemicals production is largely attributed to a surge in plastic production, which grew by 6% in 2014, nearly twice the worldwide average. Meanwhile, global production of chemicals rose by 2.8% last year, a similar ﬁgure from 2013.

HIGHEST VOLUME According to Chemical Compounds, PwC’s quarterly analysis of merger and acquisition (M&A) activity in the global chemicals sector, M&A activity in 2014 reached the highest deal volume in a decade and the highest value since 2007. 6h^V VcY DXZVc^V VcY Cdgi] America remained major drivers of activity, with acquisitions accounting for 46.5% and 34.7% of worldwide deal value, respectively. HeZX^Vain X]Zb^XVa iVg\Zih lZgZ a large contributor of the improved deal environment in 2014; more than 37% of value was driven by this segment, and it also accounted for 11 of the 25 megadeals.

“This development is a testament to that the ambitious growth plans of the Arabian Gulf’s chemicals industry,” said Dr Abdulwahab AlSadoun, Secretary General, GPCA. “The region has grown nearly 60% over the global average, an achievement that is made all the more significant when you consider that this progress was made despite continuing economic uncertainty in Europe and recent slowdown in China.” The GCC’s chemicals production was bolstered by significant expansion in polymer facilities in the UAE; Borouge added 2.5m tonnes of polyolefin capacity to its facilities, resulting in the ADNOC-Borealis joint venture’s total capacity to swell to 4.5m tonnes. “The petrochemicals sector is tied into global economic trends and demographic demand, meaning that we in the Arabian Gulf could be affected by developments from around the world,” advised Dr Al-Sadoun. “However, what we are seeing in the GCC is that local producers are not only growing but evolving—Borouge, for example, inaugurated its Innovation Centre last year, meaning that the company hopes to move away from commodity plastics and into specialty products.”

Al-Hosn Investment Company Al-Hosn Investment Company S.A.O.C (HIC) is a partnership between Qatar Holding LLC and the Ministry of Finance of the Sultanate of Oman. HIC currently focuses on private equity ŝŶǀĞƐƚŵĞŶƚƐ ŝŶ KŵĂŶ ĂŶĚ ŝŶ ŽƚŚĞƌ ' ĐŽƵŶƚƌŝĞƐ ĂŶĚ ŽŶ 'ƌĞĞŶĮĞůĚ ƉƌŽũĞĐƚƐ ŝŶ KŵĂŶ͘ dŚĞ ŽŵƉĂŶǇ ŝƐ ĂůƐŽ ƉŝŽŶĞĞƌŝŶŐ ŵĞǌǌĂŶŝŶĞ ĮŶĂŶĐĞ ŝŶ KŵĂŶ͘ ,/ ǁŽƵůĚ ůŝŬĞ ƚŽ ĞƐƚĂďůŝƐŚ ůŽŶŐ ƚĞƌŵ ƌĞůĂƟŽŶƐŚŝƉƐ ǁŝƚŚ ĐŽŶƐƵůƚĂŶƚƐ ĂŶĚ ƉĂƌƚŶĞƌƐ ƚŽ ĐŽůůĂďŽƌĂƚĞ ŝŶ ŝĚĞŶƟĨǇŝŶŐ ĂŶĚ ĚĞǀĞůŽƉŝŶŐ 'ƌĞĞŶĮĞůĚ WƌŽũĞĐƚƐ ŝŶ KŵĂŶ͘ ,/ ƚĂƌŐĞƚƐ ǀŝƚĂů ĞĐŽŶŽŵŝĐ ƐĞĐƚŽƌƐ ŝŶĐůƵĚŝŶŐ dĞĐŚŶŽůŽŐǇ͕ dĞůĞĐŽŵŵƵŶŝĐĂƟŽŶƐ͕ ,ĞĂůƚŚĐĂƌĞ͕ ĚƵĐĂƟŽŶ͕ DĂŶƵĨĂĐƚƵƌŝŶŐ ĂŶĚ Infrastructure. Our partners and shareholders are at the center of our strategic approach. We seek to be the ĞŶĂďůĞƌ ĂŶĚ ĐĂƚĂůǇƐƚ ƚŽ ďƌŝŶŐ ƚŽŐĞƚŚĞƌ ĞŶƚŚƵƐŝĂƐƟĐ ƉĂƌƚŶĞƌƐ ĂŶĚ ũŽŝŶƚůǇ ĚĞƉůŽǇ ŽƵƌ ƌĞƐƉĞĐƟǀĞ ŵĂƌŬĞƚ ĂĐĐĞƐƐ͕ ĞǆƉĞƌƟƐĞ ĂŶĚ ĐĂƉŝƚĂů ƚŽ ĐƌĞĂƚĞ ƐƵƐƚĂŝŶĂďůĞ ĐŽŵƉĞƟƟǀĞ ĂĚǀĂŶƚĂŐĞƐ͘ /Ĩ ǇŽƵ ĂƌĞ ĂŶ ŝŶĚĞƉĞŶĚĞŶƚ ĐŽŶƐƵůƚĂŶƚ ǁŝƚŚ ĞǆƉĞƌƟƐĞ ĂŶĚ ƉĂƐƐŝŽŶ ĨŽƌ ŶĞǁ business ideas in any of the above sectors or a promoter with concrete ďƵƐŝŶĞƐƐ ŝŶŝƟĂƟǀĞƐ͕ ǁĞ ĂƌĞ ƚŚĞ ƌŝŐŚƚ ƉĂƌƚŶĞƌ ĨŽƌ ǇŽƵ͘ tĞ ŚĂǀĞ ĚĞƐŝŐŶĞĚ Ă ƐƉĞĐŝĂů ĨƌĂŵĞǁŽƌŬ ƚŽ ĐŽůůĂďŽƌĂƚĞ͕ ĐŽͲĚĞǀĞůŽƉ ĂŶĚ ŶƵƌƚƵƌĞ ŝĚĞĂƐ ĂŶĚ ƚƌĂŶƐĨŽƌŵ ƚŚĞŵ ŝŶƚŽ 'ƌĞĞŶĮĞůĚ /ŶǀĞƐƚŵĞŶƚ ŝŶ KŵĂŶ͘

&Žƌ ŵŽƌĞ ĚĞƚĂŝůƐ͕ ŬŝŶĚůǇ ƌĞĨĞƌ ƚŽ͗ ŚƩƉ͗ͬͬǁǁǁ͘ĂůŚŽƐŶŽŵĂŶ͘ĐŽŵͬ ŽůůĂďŽƌĂƟŽŶ͘ƉŚƉ INFRASTRUCTURE MIDDLE EAST April 2015 February 2015

INFRASTRUCTURE MIDDLE EAST

MIDDLE EAST INFRASTRUCTURE TENDERS

INFRASTRUCTURE MIDDLE EAST

April 2015

MIDDLE EAST INFRASTRUCTURE TENDERS

Infrastructure Tenders Our monthly analysis of new tenders and key projects across the region

GCC RAILWAY PROJECT

DESERT ROSE CITY PROJECT

FUJAIRAH REFINERY PROJECT

BAHRAIN INTERNATIONAL AIRPORT EXPANSION

BUDGET: $15,000,000,000

BUDGET: $8,000,000,000

BUDGET: 3,500,000,000

BUDGET: $1,000,000,000

Territory: GCC Client Name: GCC Secretariat Description: Construction of 2,170km-long railway transportation system to connect the Gulf Cooperation Council (GCC) countries Period: 2018 Status: New Tender

Territory: UAE Client Name: Dubai Municipality Description: Development of a city covering 4,000 hectares of land between Al Ruwaya and Al Aweer across old Emirates Road in Dubai Period: 2018 Status: New Tender

Territory: UAE Client Name: IPIC Abu Dhabi Description: Engineering Procurement and Construction (EPC) contract to build a 200,000 b/day grass-roots refinery in Fujairah. Period: 2015 Status: New Tender

Territory: Bahrain Client Name: BAC Description: Expansion of Bahrain International Airportâ&#x20AC;&#x2122;s capacity to 13m passengers a year from the current 9m. Period: 2018 Status: New Tender

April 2015

INFRASTRUCTURE MIDDLE EAST

MIDDLE EAST INFRASTRUCTURE TENDERS

Top Tenders UAE

ETIHAD AIRWAYS NEW CARGO TERMINAL PROJECT - ABU DHABI INTERNATIONAL AIRPORT Project Number: DTR125-U Client Name: Etihad Airways Address: Block 17, Etihad Plaza, Khalifa City (A), Abu Dhabi Phone: (+971-2) 511 0000 Fax: (+971-2) 511 1200 Website: www.etihadairways.com Description: Development of a new Cargo Terminal covering a gross floor area of 400,000 sqm within the East Midfield of Abu Dhabi International Airport. Client is currently in the process of completing the design scope for the project brief, which will be let on a Design & Build under a Consortium Agreement, including the Material Handling Equipment. Period: 2017 Status: New Tender Tender Categories: Airport Construction & Contracting

LNG EMISSION REDUCTION PROJECT - DAS ISLAND

design (FEED) on this scheme. UKbased Amec has been awarded the project management consultancy (PMC) contract for FEED phase of project, which is still underway. The main contractor is expected to be appointed this month. Period: 2016 Status: New Tender Tender Categories: Gas processing & distribution

AL-ZORAH MIXED-USE DEVELOPMENT PROJECT Project Number: MPP2693-U Client Name: Al Zorah Development, Ajman Address: C2 Towers, 6-11th Floors, Bainunah Street, Al Bateen Phone: (+971-6) 703 0100 Fax: (+971-6) 740 7722 Description: Development of Al-Zorah mixed-use scheme comprising commercial, residential, recreational, educational and healthcare facilities including a golf course, marina and hotels. Local AIMS Group has been awarded a $31.3m contract to carry out the final infrastructure works on this development. AIMS Groupâ&#x20AC;&#x2122;s work

Project Number: MPP2639-U Client Name: Abu Dhabi Gas Liquefaction Company (ADGAS) Address: Corniche Road, Abu Dhabi Phone: (+971-2) 606 1111 Fax: (+971-2) 606 5500 Website: www.adgas.com Description: Engineering, procurement and construction (EPC) contract for the development of new flaring and Liquefied Natural Gas (LNG) emission reduction in Das Island. US-based Shaw Group has been awarded a contract to carry out the front-end engineering and

INFRASTRUCTURE MIDDLE EAST

involves completion of rest of the roads and utilities in Phase 1 and is scheduled for completion by end of this year. The first phase also includes four marinas that can house over 200 boats and a new highway linking the development to Sheikh Mohammed bin Zayed Road. Status: New Tender Tender Categories: Roads, bridges & infrastructure; Public transportation projects

OMAN PTA & PET COMPLEX PROJECT - SOHAR PORT Project Number: ZPR883-O Client Name: Oman Oil Company Address: AlHarthy Complex, Muscat PC 118 Phone: (+968) 2457 3100 Fax: (+968) 2457 3101 Website: www.omanoil. com Description: EPC contract to build a Purified Terephthalic Acid (PTA) plant with capacity of 1.1m tpa and Polyethylene Terephthalate (PET) plant with capacity of 250,000 tpa. A contract award is slated around June 2015. It is understood that technology license agreements have already been signed with Uhde Inventa-Fischer (UIF) for PET technology and with BP for

the PTA production know-how. Status: New Tender Period: 2019 Tender Categories: Industrial & Special Projects; Plastics Manufacturing Plants

RAS MARKAZ CRUDE STORAGE TERMINAL PROJECT Project Number: ZPR841-O Client Name: Oman Oil Company Address: AlHarthy Complex, Muscat PC 118 Phone: (+968) 2457 3100 Fax: (+968) 2457 3101 Website: www.omanoil. com Description: Build-Own-Operate (BOO) contract for the construction of a crude oil storage terminal with capacity of up to 200m barrels at Ras Markaz. The terminal will be located in Al Wusta region of Oman, 70km north of Duqm. It will be built in phases and serve the storage requirements of the new refinery in Duqm and provide blending facility for crude. On completion, it will be the largest crude storage terminal in the Middle East. Client has announced that this project is final stages of design. The EPC contract is expected to be tendered by end of 2015. . Period: 2018 Status: New Tender Tender Categories: Gas Processing & Distribution; Oilfields & Refineries

AMMONIA PLANT PROJECT - SALALAH FREE ZONE Project Number: WPR263-O Client Name: Takamul Investment Company Address: Bayt Muscat Bldg., Mezzanine Floor, Al Ghubra, Muscat 130 Phone: (+968) 2452 9000 Fax: (+968) 2449 4986 Website: www.takamul.com Description: EPC contract to build a a major Ammonia Plant

April 2015

MIDDLE EAST INFRASTRUCTURE TENDERS

with capacity of 1,000 tonnes a day. It is understood that a tender for the EPC contract is expected to be floated during the second quarter of 2015, after prequalifying several companies to bid. The feedstock will be sourced from the Salalah Methanol project, which is 10% owned by the client. Period: 2017 Status: New Tender Tender Categories: Industrial & Special Projects

DUQM SEAWATER SUPPLY FACILITIES PROJECT Project Number: ZPR1354-O Client Name: Duqm - SEZAD Address: Bareeq Al Shatti, Muscat PC 103 Phone: (+968) 2450 7500 Fax: (+968) 2458 7400 Website: www.duqm.gov.om Description: EPC contract to build a seawater supply and disposal system for a new refinery. The client has invited companies to prequalify for the EPC contract. A tender for prequalified companies is planned to be floated in the third quarter of 2015 with work expected to start in the fourth quarter. Period: 2018 Status: New Tender Tender Categories: Gas Processing & Distribution; Oilfields & Refineries

QATAR

LUSAIL STADIUM PROJECT Project Number: ZPR223-Q Client Name: Qatar 2022 Supreme Committee Address: Al Bidda Tower, 35th Floor, Doha Phone: (+974) 4475 2566 E-mail: (+974) 4484 5496 Website: cpm@qatar2022.qa Description: Construction of a stadium with capacity to seat 80,000 people. The stadium is among the new 9 stadiums that will be built for Qatar 2022 FIFA World Cup, and will be used for both opening and closing ceremonies. After the FIFA World Cup, this stadium will be used to host other cultural and sporting events. UK architects Foster & Partners has been appointed to design this stadium, and will work with sports stadium specialists Populous and Arup on the grounds. Period: 2019 Status: New Tender Tender Categories: Construction & Contracting; Leisure & Entertainment

Client Name: Ashgal Address: Al Faisal Tower, Al Corniche Street, Doha Phone: (+974) 4495 007 Fax: (+974) 4495 0777 Website: www.ashghal.gov.qa Description: The project involves building a series of deep tunnels that will serve the Doha South catchment area over the next 50 years and will eliminate the need for pumping stations in the area. Client is finalising documents with selected contractors for three design and build contracts for main trunk sewers in this project. Award for the 45km of 3,500mm and 4,000mm pipeline, divided into northern, central and southern sections is expected to be announced imminently, with construction work commencing on June 1, 2015. All other contracts are in the tender process for prequalified bidders and will be awarded by the end of 2015. The TSE pipeline design-build contract will be issued as an open tender. Period: 2018 Status: New Tender Tender categories: Sewerage and drainage

KUWAIT AL KHIRAN MIXED-USE DEVELOPMENT PROJECT Project Number: NPR045-K Client Name: Tamdeen Address: Souk Al-Kuwait, Safat Phone: (+965) 246 8881 Fax: (+965) 246 8882 Description: Development of a mixed-use scheme comprising a shopping mall, two freehold residential towers, a serviced apartment building and an upscale hotel. Period: 2019 Status: New Tender Tender Categories: Construction & Contracting

PRODUCED IN ASSOCIATION WITH MIDDLE EAST TENDERS

INNER DOHA RE-SEWERAGE IMPLEMENTATION STRATEGY PROJECT Project Number: IA12/13C727

April 2015

INFRASTRUCTURE MIDDLE EAST

TEN KSA INFRASTRUCTURE PROJECTS

KSA INFRASTRUCTURE PROJECTS Saudi Arabia’s plans to link foreign direct investment to infrastructure projects could propel the Middle East’s largest projects market to greater heights

INFRASTRUCTURE MIDDLE EAST

April 2015

MAKKAH MASS RAIL TRANSIT SYSTEM DEVELOPMENT PROJECT

Owner: Makkah Mass Rail Transit Company Budget: $16bn Progress: Invitation to bid The Makkah metro comprises four lines with a total length of 114 kilometers and 62 stations, and is part of a comprehensive transport system including various types of buses. In November 2014, Malaysia-based Prasarana was appointed to provide consultancy services for Phase 1 of the Programme, which covers the construction of two metro lines totalling 45·1 km and 22 stations. Sixteen consortiums have been prequaliﬁed for this project and a ﬁnal award is expected in the third quarter of 2015. Last month, the client signed a $390m agreement with Saudi Electric Company (SEC) for the connection of electricity for the metro project. WSP Parsons Brinckerhoff is the Programme Management Office Consultant for the project.

TEN KSA INFRASTRUCTURE PROJECTS

JEDDAH METRO PROJECT

Owner:Jeddah Municipality Budget: $12bn Progress: Design stage The three-line Jeddah Metro will be a 149 km elevated metro system of which 20 km would be underground. It is scheduled to start operations in 2020. The bidding for construction will be opened this year. Following an international design competition, UK’s Foster + Partners was awarded the contract to develop the architectural vision for Jeddah’s city-wide public transport plan (incorporating the metro). In May 2014, AECOM was awarded an 18-month contract worth $28m to provide consultancy services to support the preliminary planning and design phase of the master plan. In July 2014, Systra was awarded a $73.58m, 20-month contract to provide preliminary designs for the metro. The plan is tender several contracts for the metro project in mid-2016; additionally, budget allocations are expected to be revised upward.

PETRORABIGH COMPLEX EXPANSION PROJECT - PHASE 2

Owner: Saudi Aramco Budget: $8bn Progress: Financing arranged The project involves an EPC contract for the expansion of PetroRabigh reﬁning and petrochemicals complex to produce an additional 30m standard cubic feet per day of ethane and up to 3 mtpa of naphtha as feedstock to produce 5m tonnes of petrochemicals and 15m tonnes of petroleum products annually. The expanded facility was expected to start production in the ﬁrst half of 2016. Despite low oil prices, the company managed to raise a $5.2 bn loan to fund the expansion, which includes $2bn from the Japan Bank for International Cooperation and $1.31 bn from Saudi Arabia’s Public Investment Fund. The loan will be maturing in 2031. PetroRabigh is a joint venture between Saudi Aramco and Sumitomo Chemical. Both parent companies will also put in $825m each into the expansion.

FADHILI GAS PROCESSING PLANT PROJECT

Owner: Saudi Aramco Budget: $6.5bn Progress: Invitation to bid The project is at Fadhili oil ﬁeld in the Eastern Province, and involves an EPC contract to build a sour gas processing plant with a capacity of 2.5bn standard cubic feet a day. The contract has been split into three packages - Package 1: Main processing facilities - Package 2: Sulphur recovery unit (SRU) - Package 3: Off-sites and utilities According to a Trade Arabia report, Saudi Aramco has invited nine companies to submit bids for the EPC packages. The prequaliﬁed companies have until 15th April to submit their proposals. Foster Wheeler, which conducted the front end engineering and design (FEED) study for the plant, will also provide project management services during the EPC phase. The Fadhili project is expected to ensure the availability of low cost domestic gas, which is critical to the functioning of the kingdom’s petrochemical and desalination industries.

April 2015

INFRASTRUCTURE MIDDLE EAST

TEN KSA INFRASTRUCTURE PROJECTS

WASIT GAS DEVELOPMENT PROJECT

Owner: Saudi Aramco Budget: $5bn Progress: Delayed The Wasit Gas project is an initiative to develop Arabiyah and Hasbah offshore nonassociated gas fields to increase the amount of natural gas available for electricity generation in the kingdom. South Korea’s Engineering & Construction has been awarded the EPC contract for a gas processing plant and associated facilities capable of processing 2.5bn cubic feet per day of natural gas. In February 2015, Saudi Aramco reported that the installation of the Hasbah tie-in platform (TP) and Arabiyah field TP were completed. The project, which was slated to come online in the first quarter of 2015, has suffered both project delays and cost overruns as high sulphur density led to freezing in the pipelines and other technical difficulties. A number of media reports highlighted that the project will not reach full capacity until the fourth quarter of 2015, almost a year behind schedule.

INFRASTRUCTURE MIDDLE EAST

April 2015

PRINCE MOHAMMAD BIN ABDULAZIZ AIRPORT EXPANSION PROJECT - PHASE 1

Owner: GACA Budget: $1.5bn Progress: Completed In 2013, a consortium led by Turkish construction giant TAV was awarded the build-operate-transfer (BOT) contract for the phase 1 expansion of Prince Mohammed Bin Abdulaziz Airport in Medina, the ﬁrst airport privatisation deal in Saudi Arabia. The consortium will operate the airport for 25 years. The work on ﬁrst phase 1, which involves increasing the capacity of the airport from 4m passengers per year to 8m passengers, has been completed on schedule, and test runs are expected to start this month. The second phase will increase the airport’s capacity to 14m passengers a year, while the third phase will it increase to almost 27m passengers per year.

INTEGRATED SOLAR & COMBINED CYCLE POWER PLANT PROJECT - WAAD AL SHAMAL DEVELOPMENT

Owner: SEC Budget: $960m Progress: Invitation to bid

The project involves an EPC contract to build an integrated solar and combined-cycle (ISCC) power plant with a capacity of 1,050MW. This power plant will be built at the Waad Al-Shamal City, a $6bn phosphate mining development in the north of Saudi Arabia. Formerly intended as a 1,000 MW combined cycle generation facility, SEC incorporated a 50MW solar component in August 2014 to cope with the rise in demand and boost the generating capacity over the next few years. WSP Parsons Brinckerhoff was awarded the contract to carry out the environmental and social impact studies for the project. SEC has set a March 2015 deadline to submit commercial bids for the EPC contract. Waad Al-Shamal ISCC is SEC’s second such project after the 550 MW ISCC plant at Duba, scheduled for commissioning in 2017.

TEN KSA INFRASTRUCTURE PROJECTS

ABQAIQ, HAWIYAH & RAS TANURA CO-GENERATION PLANTS PROJECT

DUBA 1 INTEGRATED SOLAR COMBINED-CYCLE PLANT PROJECT

KING ABDULLAH ECONOMIC CITY DEVELOPMENT PROJECT

Owner: Saudi Aramco Budget: $650m Progress: Construction underway

Owner: SEC Budget: $600m Progress: Construction of Phase 1 underway

Owner: Emaar The Economic City Budget: $100bn Progress: Under construction

The project involves Build-own-operatetransfer (BOOT) contract for the construction of three greenﬁeld gas-ﬁred steam plants with a capacity of 900MW of power and 1,500 tonnes/hour of steam in Abqaiq, Hawiyah and Ras Tanura. A consortium of Japan’s Marubeni Corporation, JGC Corporation and local Aljomaih Energy & Water Company was awarded the contract to build and operate the plant for a period of 20 years. Samsung Engineering is the EPC contractor. The Hawiyah plant is expected to be completed by November 2015, while the Abqaiq plant is expected to be completed by January 2016. The Ras Tanura plant is expected to be completed in March 2016 marking the project’s completion.

The project involves an EPC contract to build an ISCC power plant with a capacity of 550MW in the Tabuk region of Saudi Arabia. The plant will primarily burn natural gas but will generate 50MW with the support of solar energy to increase fuel efficiency. Pre-qualiﬁed companies have been invited to submit bids for the EPC contract. The project is expected to be commissioned in 2017. US’ General Electric (GE) has been awarded the original equipment manufacturer (OEM) contract for this project. The contract includes 2 F-class gas turbines, a steam turbine, generators, heat recovery steam generators, condenser, control system and a long-term service agreement. The client has set a deadline to submit commercial bids for the EPC contract.

King Abdullah Economic City Development Project (KAEC) is one of the four new cities being built to diversify the Saudi Arabian economy. The City, which will eventually extend to an area of 168km2, comprises of six major elements, including a millennium seaport, an industrial district, a waterside resort, a ﬁnancial island, a residential district and an educational zone. Though construction work in KAEC started in 2007, only 15% of the city has been developed so far. On the other hand, KAEC’s seaport, King Abdullah Port, is the ﬁrst privately owned and funded full service commercial port in the Kingdom. The port started operations at the start of 2014, and currently has 700m of quays and a water depth of 18m. Its eight cranes can service large ships and can currently handle 1.3m TEUs.

April 2015

INFRASTRUCTURE MIDDLE EAST

COVER STORY

DISTRIBUTED ENERGY

Power plant on the roof After cracking the utility solar PV puzzle, Dubai sets its eyes on rooftop solar

INFRASTRUCTURE MIDDLE EAST

April 2015

COVER STORY

n March 15, 2015, the Dubai Electricity and Water Authority (DEWA) launched ‘Shams Dubai’ to regulate rooftop solar projects in Dubai. Just two months ago, DEWA had stunned the global solar industry by announcing a Levelised Cost of Energy (LCOE) of 5.845 US cents/kWh for the 200MW phase 1 of Mohammed bin Rashid Al Maktoum Solar Park, the lowest price achieved worldwide for a utility-scale solar photovoltaic (PV) project. Buoyed by the outcome of its ﬁrst ever Independent Power Project (IPP), which has won acclaim as a regional and international milestone, DEWA has moved into the implementation mode with its rooftop solar initiative, one of the three launched last year by the utility in support of the ‘Smart Dubai’ initiative and the vision of HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai to transform Dubai into the smartest city in the world in three years. Under DEWA’s rooftop solar initiative, households and building owners will be able to install solar PV systems on their premises to generate electricity. These systems will also be connected to DEWA’s grid. The electricity generated will be used onsite with surplus production exported to the grid. During its official launch, HE Saeed Mohammed Al Tayer, MD & CEO of DEWA said that Shams Dubai supports the Green Economy for Sustainable Development economic initiative launched by HH Sheikh Mohammed bin Rashid Al Maktoum, and implements Executive Council Resolution Number 46 of 2014, issued by HH Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Dubai Executive Council, regulating the linking of solar power generating units to Dubai’s power grid. Shams Dubai’s impact is expected to be threefold; ﬁrst, it will encourage the use of renewable energy by residential, commercial and industrial users; second, it will help develop a value chain catering to these users and third, it will help diversify Dubai’s energy mix while increasing the share of solar energy in the emirate’s electricity production. Following the award of phase 2 of the solar park, the Dubai Supreme Council of Energy (DSCE) increased the share of renewable energy in the emirate’s energy mix to 7% by 2020 and

The first rooftop solar project in Dubai to be connected to the grid is Dubai Airports’ 30KW solar array at the Al Maktoum International. The 100-panel solar array aims to limit the power used by DWC’s employee gate 15% by 2030, and rooftop solar will play an important role in achieving these targets. The launch of Shams Dubai was accompanied by the inauguration of the first rooftop solar project in Dubai to be connected to the grid – Dubai Airports’ 30KW solar array at the Al Maktoum International in Dubai World Central (DWC). The 100-panel solar array aims to limit the power used by DWC’s employee gate facility and generates about 48.8MWh of electricity per year, equal to about twothirds of the power used by the building. During the Shams Dubai launch, DEWA officials said that 11 applications have already been filed through Shams Dubai by residential, commercial and governmental entities adding up to 10MW. The biggest rooftop solar plant currently being implemented in Dubai is a 2MW plant at the International Humanitarian City. Al Tayer pointed out that DEWA’s distribution grid can accommodate 2,600MW without any further development, which means that the grid can take in 2,600MW of distributed generation. Speaking to Infrastructure ME at the post-launch event briefing, Waleed Salman, Executive Vice President of Strategy and Business Development, DEWA explained that for now, there is no cap on rooftop solar penetration levels in Dubai. He added that DEWA has already carried out an initial assessment of the network in terms of handling feeds from distributed solar energy systems. “We are ready to synchronise rooftop solar with our grid,” said Salman. “We have SCADA systems in place to manage the load on the supply side.”

regulated feed-in-tariffs (FiT) or used for self-consumption with net metering. Dubai has gone in for the latter whereby the customer’s account is settled based on an offset between exported electricity units (from the rooftop system) and imported units (from the DEWA grid). As per the terms and conditions of the connection process, the capacity installed cannot exceed the maximum load allowed on the customers’ premises. Also, Article 9 of council resolution number 46 of 2014 emphatically states that ‘no payment may be disbursed to the producer against any surplus electricity.’ Salman explained that the main objective of Shams Dubai initiative was to encourage customers to use solar panels to generate electricity for self-consumption rather than for sale. A building, for example, wouldn’t be able to generate all the power it requires from rooftop solar alone. Depending on the area available for installation of solar panels, the rooftop system may be able to provide, at the most, 20-25% of a building’s electricity needs. DEWA has launched dedicated pages for Shams Dubai on its website to provide all the information needed by customers, consultants/ contractors, and equipment manufacturers involved in the process of connecting rooftop solar systems to the grid. The connection procedure consists of four stages, namely, a No Objection Certiﬁcate (NOC) stage, followed by Design Approval; Inspection and Connection, and ﬁnally, Generation. (See Connecting solar energy to houses and buildings). DEWA will charge a one-off connection fee as part of the connection process, which will also cover the cost of the meter installed by the utility to measure the electricity generated by the PV system. Customers interested in setting up rooftop solar plants will have to kick-start the process by contacting one of DEWA’s enrolled contractors/ consultants to investigate the feasibility and get guidance on the best solution. Currently, 19 contractors/consultants are enrolled; with regard to PV modules, 16 manufacturers have been enrolled including names from the global top 10. DEWA is currently working with inverter and interface protection manufacturers to get them enrolled as well. HIGH TARIFFS AND ROI

NET METERING OVER FIT

Typically, electricity generated by rooftop solar plants could be fed into the grid at

DEWA’s slab tariff system together with some of the highest electricity tariffs in the GCC, makes rooftop solar a compelling option for

April 2015

INFRASTRUCTURE MIDDLE EAST

COVER STORY

heavy consumers of electricity, with regard to the savings to be had from using solar vis-à-vis conventional grid power. The combination of higher tariffs and slab system promises to reduce the number of years needed to break even. The formal launch of Shams Dubai now makes it easy for end-users and developers, who were waiting for proper regulations and documentation requirements, to move forward on surer footing. At a panel discussion on rooftop solar at Middle East Electricity (MEE) last month (which took place before the launch of Shams Dubai - editor), Evangelos Lianos, Executive Director ME, Yingli Solar pointed out the economics of rooftop solar is determined by the cost of electricity the customer pays at present, and how much it would cost him or her to install a rooftop solar system. He continued: “If the Return on Investment (RoI) is between 6-9 years, the decision should be quite easy because you know electricity prices will only go up, your capital investment stays the same, operational expenses are low and the lifetime of such rooftop systems are at least 25 years.” According to co-panellist Waseem Qureshi,

director and CEO of MiccGreenTec Solar Systems, which is behind some of the largest off-grid solar power installations in the private sector in the UAE, payback times can be reduced further to as low as three years by using the latest technologies available. He said: “We got a very good response from the industrial and commercial sectors in the Northern Emirates. As a diesel powered market, they were paying more than AED1/kWh which made solar power systems much more viable.” The fact that Dubai is located in a region with high solar yields, taken together with decreasing prices of solar panels should result in quicker RoI. The cost-benefit analysis will be quite straightforward for industrial consumers on higher slabs, who must also contend with the fuel surcharge. On the flip side, the main bottleneck to widespread adoption of rooftop solar is expected to be financing. “We need to take off the load from the customer from a capex standpoint,” said Qureshi, during the panel discussion. “The customer is often reluctant to spend from his own pocket. We experienced a huge change in sales when we started rentals and financing deals.”

Connecting Solar Energy To Houses And Buildings

FUNDING OPTIONS

DEWA ENROLLED CONTRACTORS & CONSULTANTS

Obtain DEWA building NOC

Upload the relevant documents through the ‘One Window Application’ for getting electricity

Download Technical Approval upon receiving notification

Notify through the system for technical inspection after completion of field works

Coordinate for Site Technical Inspection, Install Meter and Connection

INFRASTRUCTURE MIDDLE EAST

April 2015

Overseas, the solar lease has proved to be a popular ﬁnancing option for end-users seeking the beneﬁts of rooftop solar without the issues associated with funding, installation, approval, operation and maintenance of the system. It is not clear whether the Shams Dubai framework, with its net metering approach, will be as bankable as Europe’s FiT approach, where the FiT committed by the government entity or credit agency is regarded as guaranteed returns by the bank. In Dubai, the lessor will have to go through the consumer, and it remains to be seen whether banks would see that as a big risk, preferring to hedge their bets with credit-worthy entities. On 26th March, MESIA (Middle East Solar Industry Association) hosted an event to discuss Shams Dubai with industry representatives and key members of DEWA. One of the messages that emerged from the event was that the regulations only envisage a contractual relationship between DEWA and the customer; in other words, DEWA will have no contractual agreement with the developer entity. However, the consumer is free to enter into a commercial arrangement with a

developer in connection with the supply, installation and funding of the equipment and the developer is free to negotiate a fee in exchange for its services and equipment. This opens a pathway for developers to be involved in the scheme in a quasi-IPP arrangement. One of the speakers at the MESIA event recommended the energy performance contracting model followed by Energy Service Companies or ESCOs. Under an energy performance contracting (EPC) arrangement, the ESCO develops, implements and finances (or arranges financing) of an energy efficiency project, and uses the stream of income from the cost savings, to repay the costs of the project, including the costs of the investment. Another concept that has emerged in the US to address the financing challenge is yieldco, which borrows loosely from Real Estate Investment Trust (REIT) concept. In this case, renewable long-term contracted operating assets are bundled to generate predictable cash flows. While taking roofs and leasing solar energy to the owner has proved workable abroad, it is not clear whether such concepts will work in Dubai. The MESIA event also brought to the forefront two key developer concerns: (i) the covenant strength of the consumer; and (ii) protection in the event that the consumer leaves the property and/or there is a change in circumstances surrounding the property. Given the contractual arrangement, DEWA would be unable to assist with these issues, which means that developers will have to address this risk themselves. Apart from funding, another obstacle that rooftop solar could come up against is technical awareness on the part of the customers, who are accustomed to the relative ‘plug and play’ convenience of diesel generators. Also, there is no reason to believe that rooftop solar systems would be immune to sandstorms and dust issues that have affected the operations of large-scale solar PV plants. This could result in higher operations and maintenance (O&M) costs and consequently longer payback periods. While the decreasing cost of solar modules is leading to a shift from leasing to ownership of rooftop systems in the West, in Dubai’s case, a key deterrent to ownership would be demographics where owneroccupiers are a minority in a population where expatriates form the majority.

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SPECIAL REPORT

WETEX 2015

Leading by example Dubai Electricity and Water Authority (DEWA) has a clear strategy to become a sustainable and innovative world-class utility hen HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai decided that nothing less than the ‘smartest city in the world’ status will do for Dubai, the city’s different stakeholders announced a ﬂurry of initiatives that support the ‘Smart Dubai’ agenda. As the city’s sole power and water utility, Dubai Electricity and Water Authority (DEWA) rolled out three regional-ﬁrst smart initiatives that support the ‘Smart Dubai’ agenda. Shams Dubai is DEWA’s rooftop solar programme to encourage households and building owners to install photovoltaic (PV) solar panels to generate electricity. The second initiative includes smart applications that use smart meters and grids that enable fast-service connection,

INFRASTRUCTURE MIDDLE EAST

April 2015

accurate billing and rationalisation of energy use. DEWA is rolling out 1,200,000 new smart meters with plans to replace all mechanical/electromechanical meters within the next ﬁve years. The third initiative involves setting up electric vehicle charging infrastructure in the city. DEWA has already established

“Using renewable energy and implementing demand-side management programmes in smart cities contribute to achieving a diversified sustainable economy” HE SAEED MOHAMMED AL TAYER, MD & CEO, DUBAI ELECTRICITY AND WATER AUTHORITY (DEWA)

16 charging stations (including 12 in its own premises) and will install 84 more stations to achieve the target of 100 stations by the end of 2015. According to HE Saeed Mohammed Al Tayer, MD & CEO, DEWA, the utility’s mega-projects, such as the Mohammed bin Rashid Al Maktoum Solar Park, the Hassyan clean-coal power plant, the smart grid project, and other strategic initiatives support the Dubai Integrated Energy Strategy 2030 (DIES 2030) to diversify the energy mix and reduce demand. DIES 2030 aims to reduce the emirate’s energy demand by 30% and diversify its energy mix with 71% from natural gas, 15% from renewable energy and 7% each from nuclear and clean coal, all by 2030. “Diversiﬁcation of energy sources and ensuring sustainability are among the key elements for the transformation into smart and sustainable cities,” said Al Tayer.

SPECIAL REPORT

ESCO to promote the optimal use of energy, improve the energy efficiency market, and retroﬁt more than 30,000 existing buildings in Dubai. The present cost of this project will be approximately $8.17bn, with returns of $22.32bn, and a net present proﬁt of $14.16bn. WALKING THE TALK

Mohammed bin Rashid Al Maktoum Solar Park The 13MW Phase 1 became operational in 2013

“Using renewable energy and implementing demand-side management programmes in smart cities contribute to achieving a diversiﬁed sustainable economy.” RENEWABLE ENERGY LEADER

With the Mohammed bin Rashid Al Maktoum Solar Park, DEWA is implementing what is one of the largest renewable energy projects in the region today. The solar park will eventually produce 3,000MW of electricity when it will be completed in 2030. The second phase of the park, a 200MW solar photovoltaic (PV) project based on the Independent Power Producer (IPP) model, set a global milestone for utility-scale solar power generation with a landmark level tariff of 5.84 USD cents/ kWh. Encouraged by its success, DEWA recently issued a tender inviting advisory services for Phase 3, an 800MW solar PV IPP, which will be awarded in 2016. The utility is also moving ahead with the 1,200 MW Phase 1 of its clean-coal power project, which is expected to be operational by 2020. “This IPP-based clean coal project is a key step in the implementation of the energy diversiﬁcation strategy formulated by the Supreme Council of Energy, to introduce clean coal-based electricity generation into Dubai’s energy mix,” said Al Tayer. “As a large part of electricity produced globally comes through the use of coal, which produces carbon dioxide, the strategy of

INFRASTRUCTURE MIDDLE EAST

April 2015

“As a large part of electricity produced globally comes through the use of coal, which produces carbon dioxide, the strategy of using clean coal seeks to raise the efficiency of coal combustion with lower emissions” HE SAEED MOHAMMED AL TAYER, MD & CEO, DUBAI ELECTRICITY AND WATER AUTHORITY (DEWA)

using clean coal seeks to raise the efficiency of coal combustion with lower emissions.” While focussing on clean energy for new power generation projects, DEWA is also paying attention to optimising its existing gas-based generation assets. For example, the implementation of Thermal Energy Storage Turbine Inlet Air Chilling (TESTIAC) technology raised the utility’s generation capacity during summer months by an additional 400MW and also fetched it global and local acclaim. DEWA has also developed plans and programmes for demand side management, energy efficiency and operational improvement. It has established Etihad

What perhaps differentiates DEWA from its peers in the region is that it has always led by example. Thus, it adheres to green building standards for all its new construction. DEWA’s Sustainable Building in Al Quoz is the ﬁrst sustainable government building in the UAE and the largest government building in the world to receive a LEED Platinum rating. Earlier this year, it also signed two contracts for energy efficiency with Etihad ESCO, with a combined value of $10.07m to improve and enhance overall energy efficiency of the lighting infrastructure at its Jebel Ali and Al Awir the power plants, and in seven of its buildings. “DEWA is proud to lead by example by implementing energy-efficiency through the innovative energy performance contracting model, which is new to the region,” said Al Tayer. “Our partnership with Etihad ESCO will further drive public-private partnerships that support the vision of making Dubai a leading example of energy efficiency for the region and the world.” He added that DEWA’s investments in the energy sector are approximately $15.15bn for the next ﬁve years in enhancing production of electricity, water, renewable energy, smart grids, and their transmission and distribution networks. The investment covers several projects, including the infrastructure for Expo2020, estimated at $710m. WETEX CELEBRATES 17 YEARS

The utility’s investment plans and initiatives are expected to be the cynosure of all eyes at the 17th Water, Energy, Technology, and Environment Exhibition (WETEX), the annual event organised by DEWA under the directives of HH Sheikh Mohammed bin Rashid Al Maktoum and under the patronage of HH Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, Minister of Finance of the UAE and President of DEWA. “DEWA has been working hard to position WETEX as an important global platform,” said Al Tayer. “Over 16 years, the exhibition has made huge strides in focusing on solutions

SPECIAL REPORT

for water and environment, oil and gas, and conventional and renewable energy. It has triggered agreements and deals that directly support the economic, socio-economic and environmental development not only of Dubai and the UAE, but for the entire region.” The event, which started with only four exhibitors and 357 trade visitors in 1999 attracted over 1,500 exhibitors and 23,000 visitors in 2014. DEWA’s path-breaking renewable energy projects, its efforts to develop an energy performance contracting in the emirate, coupled with its numerous initiatives aimed at delivering DIES 2030 and Smart Dubai agendas has pushed WETEX 2015 to the centre stage as the event where the technologies, expertise and business opportunities will converge to help Dubai and the region at large realise its ambitions. WETEX 2015 is a key component of the 2nd Green Week, which includes the 2nd World Green Economy Summit and the Arab Oil and Gas exhibition. WGES 2015 will focus on topics and ideas that will be discussed at the 21st gathering of the Conference of the Parties (COP 21) in Paris, the United Nations Framework

“WGES 2015 will focus on topics and ideas that will be discussed at the 21st gathering of the Conference of the Parties (COP 21) in Paris, the United Nations Framework Convention on climate change, the laws and regulations related to climate change and leadership in climate change” Convention on climate change, the laws and regulations related to climate change and leadership in climate change, the role played by young people in driving change, the role of public-private partnerships in protecting global climate, innovation and funding, and new solutions. Over 2,000 people are expected to attend WGES 2015 from over 40 countries.

Realising IoT solutions with Advantech at WETEX 2015

Though WETEX had always been business-to-business (B2B) event since its inception, in recent years has seen the development of a substantial business-toconsumer (B2C) element to the event. Al Tayer said: “Consumers of electricity and water are interested in reducing the amount of their monthly bills. That’s why, it is important to raise awareness of rationalising use, which WETEX 2015 works to achieve. It showcases the best energy-saving products, such as high-efficiency electrical lamps, environmentally-friendly home appliances, and tools for reducing water use. These mainly benefit the consumer and provide significant financial savings.” In fact, DEWA targets consumers as part of its demand side management strategy, reaching out to them through campaigns, competitions, awards and events like WETEX in order educate them about the benefits of using energy-efficient appliances and equipment and best practices that help in conservation. As part of the Green Week agenda, open activities for the general public will be held at different locations across Dubai highlighting sustainability and conservation.

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Advantech cordially invites you to visit us at Booth No.

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BW7 in Hall 7 at WETEX , to be held on April 21-23, in the

and solar power control systems.

Dubai International Convention and Exhibition Centre.

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The theme of this exhibition is “Realising

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IoT solutions with Advantech”.

RTU, controllers, communication and management.

We will be focusing on power, energy and water

Advantech would like to take this opportunity to

industries. Advantech will also be showcasing its latest

meet with you and share various service and support

hardware and software portfolios for these solutions.

options, consultancy and training opportunities We looking forward to meeting you at our booth and sincerely invite you to schedule a meeting with us Sincerely, Your Advantech Team

INFRASTRUCTURE MIDDLE EAST

April 2015

SPOTLIGHT

TECH FOCUS

Game changer Having built its reputation with some of the largest solar power installations in the UAE’s private sector, MiccGreenTec is all set to transform the automotive and cooling markets with its new, path-breaking technologies unshine is aplenty in the UAE, but it takes the right kind of expertise to harvest this energy and apply it to the country’s fuel-intensive industries. Dubaibased solar research and development (R&D) company MiccGreenTec Solar Systems has carved a niche for itself through the introduction of revolutionary ecofriendly products in the UAE market. MiccGreenTec specialises in power electronics and renewable energy, and its products have CE Marking, which indicates full compliance with European Union (EU) legislation. Waseem Qureshi, MiccGreenTec’s Director and CEO points out that his company has come a long way since its inception in 2009, sowing the seeds of a sustainable green economy, notably in the UAE. Among MiccGreenTec’s latest innovations is a battery pack, which will positively impact the automobile industry and encourage the switch to electricity-based vehicles. Qureshi, an enterprising electronics engineer in his own right, elaborates: “The biggest bottleneck in the automobile industry right now is that batteries take longer to recharge compared to refueling your car. This (the battery) is something we have recently developed and is going to be a game-changer in the coming era. Its main property is that it can be charged in 16 seconds instead of six to eight hours as is the case currently. With this achievement, we will be able to recharge electric vehicles at the same time it takes to refuel cars.” He notes that the recharging time for MiccGreenTec’s battery pack is the lowest compared to other technologies across the world and much more cost-effective. Apart from powering electric cars, he plans to use this innovation to power auto-rickshaws,

Waseem Qureshi, Director and CEO, MiccGreenTec

a popular mode of public transport in the subcontinent region (especially India, Pakistan and Bangladesh) and also in the Philippines. Another exciting project that MiccGreenTec is working on is in line with climate-based initiatives. “One of our upcoming projects is a sophisticated three-tonne air conditioner, which does not have a compressor and runs on 0.6kW compared to conventional coolers that run on 6kW,” says Qureshi. “This is a big achievement because 80% of the world’s energy consumption is either through heating or cooling. In a country like the UAE, the overall design will be a game-changing product.” THE GREEN TREND

According to Qureshi, the UAE’s efforts to transform into a green economy is fairly new; therefore, residents are turning to conservation with a fresh mind compared to the time when MiccGreenTec ﬁrst started out in the market. He says: “Going green (here) is a huge trend now. It was hard convincing people back then because everyone wanted a good economy but did not want to invest in the costs involved.” With a strong focus on research,

design, development and manufacturing, MiccGreenTec continues to create new concepts, working closely with UAE authorities to help save the world’s depleting resources. To date, the company has successfully implemented a number of large-scale solar power projects in the different emirates of the UAE, including a labour camp and ﬁne dining restaurant in Ajman, a factory in Umm Al Quwain and a desert safari camp and camel breeding farm in Dubai, to name a few. “Our labour camp project in Ajman was bagged the Solar Project of the Year Award at Middle East Electricity 2015,” he adds. Globally, MiccGreenTec has successfully has left a positive trail in Pakistan, the US, Ghana, Nigeria, China and Denmark; the company also has on-going projects in Saudi Arabia and India. With its sales and marketing being handled by QMEGA, MiccGreenTec is free to focus solely on technology advancement. The company achieved a turnover of $10m in 2014, and is targeting $16m turnover by the end of this year. Besides being a founding member of the Middle East Solar Industry Association (MESIA), MiccGreenTec also participates in major forums like the World Future Energy Summit (WFES) and exhibitions such as Solar Middle East. MARKET OBSTACLES

At a recent seminar where he was invited to speak, Qureshi shared his experiences in putting up some of the largest solar installations in the private sector in the UAE. “Some of the biggest obstacles I’d addressed were lack of green awareness, credibility, and heavy cutbacks,” says the MiccGreenTec head. “The main problem is that people are not conﬁdent that the green product they are about to purchase will provide return on investment, and Internet information is very limited, as the technology here (in the UAE) is an emerging one. A guarantee in the form of lenient payment or free installations may help the green market.”

April 2015

INFRASTRUCTURE MIDDLE EAST

OIL AND GAS

Single platform Integrated automation can be a key enabler of safety, efficiency, productivity in the oil and gas industry By James Mullen, Oil and Gas Account Manager - Qatar and Kuwait, Rockwell Automation

“The benefits of a fully integrated approach include the lower costs that come with learning just one system, simplicity of programming and common components” 38

INFRASTRUCTURE MIDDLE EAST

April 2015

vents in the oil and gas industry have highlighted the importance of maintaining the highest standards of safety at all times. Even without high-profile incidents, the industry is responsible for demonstrating the highest ethical and environmentally-conscious values while meeting the planet’s energy requirements. Just as importantly, oil and gas producers need to be mindful that downtime in this industry often surpasses $1m per hour. Operators, then, have to demand the highest level of safety in order to protect personnel, assets and the environment while maintaining maximum uptime and minimal operational disruption. Such disruption will destabilise the market and put companies at risk for incurring substantial downtime losses. The inability to respond effectively to hazardous situations can be extremely costly, from jeopardising personnel to diminishing the bottom line, damaging brand reputation, or denting consumer and investor confidence. With the resurgence of the North American oil and gas market, buoyant prices in Canada and burgeoning operations in China and Australia, skilled staff are able to command ever-higher salaries. The fact that there is a finite number of qualified people available to carry out the work that can be done, the risks inherent in a workforce that lacks experience and expertise clearly have a bearing on operational safety. With its focus on maximising efficiency, productivity and safer ways of working, automation can play a major role in enabling the industry to fulfil potential. Faster return on safety investments: Today’s safety technology goes beyond reducing the numbers and types of hazards in a working environment. It can bring a wide range of significant benefits, not only providing a faster return on safety investment, but also making a positive contribution to productivity. When shutdowns occur, recovering as quickly and as safely as possible results in reduced downtime and improved operational efficiency. Safety systems with improved diagnostics, which inform operators precisely where faults have occurred, can help reduce the time taken to get equipment back online. Predictive maintenance: Predictive maintenance helps to avoid incidents, but they

can still occur from time to time. When standard and safety control systems are integrated seamlessly within one platform, utilising HMI displays through an open network, incidents are more quickly identified and resolved, reducing potential downtime. A single control environment for automation and safety control also simplifies training for operation, maintenance and troubleshooting efficiency. Critical control and modular fault tolerance: A critical enabler for cost effective remote operations is the fault tolerant design of the process safety systems and the ability to maintain these systems online without requiring a shutdown. The efficient and secure operation of these remote resources requires close monitoring. A modern control system provides a way of meeting all these demands at three capability levels: remote automation, monitoring and safety, and connectivity to enterprise information systems, with specific solutions to meet remote operation challenges. Critical control, information and safety: Producers worldwide are seeing the benefits of single source supplier for integrated power, control and safety applications. The benefits of a fully integrated approach include the lower costs that come with learning just one system, simplicity of programming and common components. A distributed, scalable architecture offers the flexibility to specify the appropriate level of system safety integrity. Striking the right balance from the range of technology options requires careful consideration of the specific capabilities, limitations and advantages of each one, along with an understanding of the degree of flexibility needed, from small quantity I/O to large systems, non-safety to SIL 3, and fail-safe to multiple fault tolerant. Rockwell Automation offers a superior approach to industrial control that integrates sequential, process, drive and motion functionality in a single platform. With products that meet stringent SIL-2 requirements through sophisticated diagnostics and high levels of reliability – measured by mean time between failure, low mean time to repair and low probability of failure on demand – our controllers set new standards for reliability and availability, increasing safety and productivity while reducing downtime, nuisance trips and life cycle costs.

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CITIES

SMART PROSPECTS

Connected Things Smart cities represent a great revenue opportunity for technology and services providers ncreasing urbanisation is putting unprecedented pressure on city mayors to constantly balance the challenge of resource constraints against environmental sustainability concerns. Gartner estimates that 1.1bn connected things will be used by smart cities in 2015 (see Table 1), rising to 9.7bn by 2020. Smart homes and smart commercial buildings will represent 45% of total connected things in use in 2015, due to investment and service opportunity, and Gartner estimates that this will rise to 81% by 2020. “Smart cities represent a great revenue opportunity for technology and services providers (TSPs), but providers need to start to plan, engage and position their offerings now,” says Bettina Tratz-Ryan, research vice president at Gartner. Gartner deﬁnes a smart city as an urbanised area where multiple sectors cooperate to achieve sustainable outcomes through the analysis of contextual, real-time information shared among sector-speciﬁc information and operational technology systems. “The majority of Internet of Things (IoT)

spending for smart cities will come from the private sector. This is good news for TSPs as the private sector has shorter and more succinct procurement cycles than public sectors and cities,” says Tratz-Ryan. Residential citizens will lead the way by increasingly investing in smart-home solutions, with the number of connected things used in smart homes to surpass 1bn units in 2017. Connected things include smart LED lighting, healthcare monitoring, smart locks and various sensors for such things as motion detection or carbon monoxide. Smart LED lighting will record the highest growth of IoT consumer applications, from 6m

Smart LED lighting will record the highest growth of IoT consumer applications, from 6m units in 2015 to 570m units by 2020. Light will move from being an illumination source to a communications carrier

Connected Things Installed Base within Smart Cities (in Millions) Smart City Subcategory

Healthcare

2015

2016

2017

9.7

15.0

23.4

97.8

126.4

159.5

Smart Commercial Buildings

206.2

354.6

648.1

Smart Homes

294.2

586.1

1,067.0

Transport

237.2

298.9

371.0

Utilities

252.0

304.9

371.1

Others

10.2

18.4

33.9

1,107.3

1,704.2

2,674.0

Public Services

Total

Source: Gartner (March 2015)

INFRASTRUCTURE MIDDLE EAST

April 2015

units in 2015 to 570m units by 2020. Light will move from being an illumination source to a communications carrier incorporating safety, health, pollution and personalised services. “Homes will move from being interconnected to become information- and smart-enabled, with an integrated services environment that not only provides value to the home, but also creates individual-driven ambience. The home will become the personal space that provides assistance or personal concierge experiences to the individual,” says Tratz-Ryan. In addition to residential IoT investments, there are a number of IoT deployments for on-street and off-street parking guidance, road traffic guidance and traffic flow metering. A quick win within transport is the reduction of traffic congestion. California and the UK are already implementing radio receivers or sensors that are embedded on a section of highway to diagnose traffic conditions in real time. Another successful use of IoT in the city is smart parking. The city of Los Angeles, for example, has been implementing new parking meters, parking space vehicle sensors, real-time parking guidance and a full parking management system to influence demand during peak times. New and transformative business environments and ecosystems will emerge. For instance, automobile companies are investing in streetlights with charging stations embedded in the post to reduce the infrastructure investment for automobile charging stations. Sensors allow these companies to identify vacant charge-parking spaces for their customers, communicated via mobile applications and onboard systems. They will also be the facilitators of the payment and transaction for ease of use. Gartner also estimates that smart-home security and safety will represent the secondlargest service market by revenue in 2017, and that by 2020, the smart healthcare and fitness market will have grown to nearly $38bn. “We expect commercial IoT implementations to be used across multiple industries, such as smart energy, environmental service or journey planning, which will offer TSPs the opportunity to monetise IoT by building IoT-related service models,” says Tratz-Ryan. “Significant value contribution will come from information and data analytics of IoT, which connect services to third-party transactions and billing records, as well as enabling subscriptions or on-demand services. This enables a multidimensional value chain with different partners.”

TRANSPORTATION

TRACK DESIGNS

Durable fibre

Synthetic ﬁbres are now proving their mettle as reinforcement substitutes in railway applications

he aggressive timelines of some of railway projects in the Gulf, together with the technical challenges of building rail infrastructure in complex topographies has opened up prospects for technologies that provide significant reduction in construction time without compromising on quality and durability. Synthetic fibres are being used in railway projects internationally either as the only form of reinforcement or as a hybrid solution with conventional bar reinforcement. “The main advantage of synthetic fibres is protection against corrosion,” says Dr Stefan Bernard, Managing Director of Technologies In Structural Engineering (TSE) P/L, based in Penrith, Australia. “The technology grew out of the mining industry in Australia, where it has completely replaced conventional steel reinforcement.” Synthetic fibres have been successfully used as reinforcement for track slabs and sleepers all over the world. In fact, laying and tying steel reinforcement is a huge

time consumer during the construction process. Steel bar can also cause unwanted conductivity from the rail, potentially causing corrosion of steel infrastructure. “When you use fibre reinforcement, there is a very substantial saving in terms of simplification of reinforcement,” says Bernard. “Instead of completely replacing the steel bar, you can produce a hybrid solution where the steel layer is simplified. You use fibres to effectively replace the stirrups and all the minor reinforcement. This greatly increases productivity because you eliminate the vast majority of steel fixing, and by simply retaining the major bars, you increase the speed of production. Savings are achieved in the increased rate of construction, and the fibres themselves are cheaper than the bars.” Bernard notes that every concrete element in a rail project can have fibres or a combination of fibres and conventional reinforcement. “There are all sorts of possibilities available when you have a form of reinforcement that increases fatigue resistance and doesn’t suffer any corrosion problems at all,” he adds.

The use of shotcrete linings is well established in tunnels with drill and blast operations for excavation. In Norway, 85% of the new construction over the past five years have been synthetic fibre-reinforced primarily due to corrosion issues. According to Bernard, the cost of a pure fibre solution varies from that of a hybrid solution but synthetic fibres offer a cost advantage in terms of total cost of reinforcement. For example, in pavements, bar reinforcement doesn’t provide any fatigue resistance whereas fibres enhance the same. Therefore, the number of cycles to failure can be increased. Of course, it depends on whether or not designers exploit this benefit,” says Bernard. “If they are willing to do so, there can be considerable savings in the thickness of the pavement and enhancement in the total life of the structure. You can also reduce the amount of cement by substituting with fibres.” Where fibres are being used in precast concrete, the dosing of fibres takes place at the batching plant. The concrete is transported to the precast yard, cast, cured and kept offsite for a while before being

“There are all sorts of possibilities available when you have a form of reinforcement that increases fatigue resistance and doesn’t suffer any corrosion problems at all” DR STEFAN BERNARD, MANAGING DIRECTOR OF TECHNOLOGIES IN STRUCTURAL ENGINEERING (TSE) P/L

INFRASTRUCTURE MIDDLE EAST

April 2015

TRANSPORTATION

transported to the work site. Whether it is precast or cast-in-place-slab, the major advantage for large projects is the speed of construction for fibre reinforcement compared to bar reinforcement. However, out of the 100 odd manufacturers of synthetic fibre worldwide, only a handful produce the highly engineered fibres that achieve the level of performance competitive with bars and steel fibres. Bernard also cautions that the performance of synthetic fibres is specific to the product. “There are no generic codes or specifications for synthetic fibre,” he says. “You have to obtain the information on performance from the manufacturer. The research done by a fibre manufacturer on the performance of their product is specific to that product. It is not relevant to other brands of synthetic fibres. ” The absence of generic code is compensated by national guidelines for using fibre reinforced concrete. For example, for slab on road and pavement, there are design codes like TR54 in the UK and ACI 360 in the US. Codes for shotcrete use internationally include Australian Shotcrete Society guidelines; ACI 544 and 506 in the US; Norwegian Road Authority

A BRIEF HISTORY OF FIBRES “Before shotcrete made its appearance in underground mining from 1990s onwards, mesh reinforced concrete was prevalent. However, mine owners and operators quickly discovered mesh was an expensive and impractical way of reinforcing the concrete with dangerous repercussions. They switched to steel fibres but it became apparent within five years that corrosion was a serious problem. They quickly realised that there was no point in putting steel fibres into sprayed concrete linings in mines as they rusted in a few years. They pushed for replacing steel with synthetic fibres that came into the market initially in mid to late 90s; now synthetic fibres have 100% usage in the mining industry in Australia; in South America, it is about 60%.”

SYNTHETIC FIBRE REPLACING STEEL IN CONCRETE EUROPE – AFRICA – MIDDLE EAST- NORTH & SOUTH AMERICA – AUSTRALASIA

Publication Number 7 on the design of shotcrete linings in tunnels. The clauses in the Model Code 2010 for Concrete Structures that are applicable to steel fibres are applicable to synthetic fibres as well. Will the absence of a global standard for fibre reinforced concrete, and specifically synthetic fibres, come in the way of their acceptance in the Gulf region? Bernard says: “Just as steel fibres were an improvement over the mesh, synthetic fibres are an improvement over steel fibres thanks to their corrosion advantages. The absence of global standards for steel fibres hasn’t come in the way of their acceptance, and the same applies to synthetic fibres as well.” According to Bernard, the region’s infrastructure stakeholders need to make up their mind on whether they want to wait for 5-10 years to discover that corrosion is a serious problem for all the new construction currently underway or accept that synthetic reinforcement has enormous advantages over conventional steel reinforcement in terms of corrosion now rather than having to replace it later on. “The mining industry discovered these mistakes 15-20 years ago. Is the same going to happen here?” he concludes.

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TRANSPORTATION

IN FOCUS

RAIL MATERIAL

Innovative plastics SABIC offers a number of thermoplastic materials for highly demanding railway interior applications audi Arabia headquartered petrochemicals giant SABIC (Saudi Basic Industries Corporation) is a major supplier of compliant, highperformance thermoplastics materials to the global railway industry, the majority of these being used in rolling stock interiors. Kim Choate, Market Director, Mass Transportation, Innovative Plastics, SABIC says: “SABIC is constantly assessing the needs of the railway industry, in response to developing trends and the ever-changing regulatory environment, in order to create relevant new material solutions for railway interiors.” The petrochemicals major’s railway portfolio comprises sheet, resin and glazing solutions for sidewalls, luggage racks, transparent cabin dividers, ceilings and windows, as well as solutions for seating, electrical and lighting applications. SABIC sees for itself a key role in serving the global railway industry with thermoplastics products that will enable lightweight and sustainable solutions. “There are several ways to look at sustainability,” says Choate. “For example, are the materials used for the rail coach interiors durable enough to withstand the punishment of heavy daily use without needing to be replaced? What happens to a railway seat at the end of its useful life? Is it recyclable? A third way is to consider sustainability in terms of energy. Is it possible to make a rail coach weigh less so that it requires less energy to move?” SABIC was involved in two rail seating projects – one in Mumbai, India and the other in Sao Paulo, Brazil that tie together all three concepts. The challenge for both Mumbai Rail Vikas Corporation in India and Bombardier in Brazil was to create a modern, new look rail seating that would be light-weight, yet strong enough to endure the heavy loads and abuse of daily use by thousands of passengers.

Kim Choate, Market Director, Mass Transportation, Innovative Plastics, SABIC

SABIC worked with the tier suppliers of both customers to design new injection-moulded seats using compliant grades of SABIC resins that the company claims were up to 15% lighter than the seats they were replacing. In addition, because the seats were injection moulded using a copolymer (rather than produced via thermoset processing using ﬁbre-reinforced plastic), they could be produced more quickly, and are recyclable at the end of their useful life. EXPANDED PORTFOLIO

SABIC recently expanded its LEXAN resin portfolio of polycarbonate materials in response to the implementation of the pan-European norm for ﬁre safety in rail interiors (EN 45545-2:2013). “SABIC is a leader in the development of thermoplastics that meet the standards of EN 45545, the new European norm for rail safety,” says Choates. “We proactively developed a suite of materials to meet EN 45545 standards in advance of its implementation, so that the supply chain would have a source of compliant materials, helping to avoid manufacturing delay.” “The rail industry is constantly changing,

with external forces such as regulatory requirements, or competitive forces such as Life Cycle Cost reduction, or industry trends, such as a desire for a better passenger experience driving those changes,” says Choates. “Innovation is the response to all of these forces, and SABIC offers a number of different competencies – beyond supplying a broad portfolio of compliant materials – to help our customers innovate.” He notes that best results are achieved when customers engage SABIC at the concept generation and design phase. The latter’s insights into material properties, aesthetics and plastics processing technologies lead to a better, more efficient design that often consolidates parts. SABIC also works with its customers to provide a range of predictive engineering tests, such as impact resistance, or simulate years of exposure to cleaning chemicals or ultraviolet light, or help them validate whether the innovation they are developing will perform as expected over time. “Mass Transportation is an industry segment that SABIC values highly, and most of the key railway interiors suppliers have been customers of SABIC for many years,” says Choates. “We are actively engaged with stakeholders on infrastructure requirements for the upcoming Riyadh metro.” The petrochemicals giant has set up the SABIC Plastics Application Development Centre (SPADC) in Riyadh to help enable downstream industry development through application development and testing of materials. SPADC is expected to play an important role in developing applications that address the environmental conditions unique to the region. “In general, with respect to the environment, SABIC´s portfolio serves the railway industry with thermoplastics products that will allow lightweight, more sustainable solutions,” says the SABIC spokesperson. “The GCC region presents several opportunities to push the boundaries of material performance as it relates to unique climate and environmental conditions.”

April 2015

INFRASTRUCTURE MIDDLE EAST

TRANSPORTATION

PORTS

Ruling the crossroads SOHAR Port and Freezone is leveraging its JV partner Port of Rotterdam’s expertise and cutting-edge technology to stay ahead of competition s Executive Commercial Manager of SOHAR Port and Freezone, Edwin Lammers is responsible for managing and overseeing the commercial interests of both land and marine operations at one of the world’s largest port development sites. Having joined SOHAR Port and Freezone in 2009, Lammers has been a key part of the transformation that has seen global terminal operators as well as international shipping lines ﬂock to this 50:50 joint venture between the Sultanate of Oman and the Port of Rotterdam, a world top 10 port. He is bullish about future growth, citing the spike in enquiries after Oman announced its railway plans as proof of investor interest and conﬁdence in SOHAR’s unique position at the crossroads of the east-west trade routes. Lammers spoke to Infrastructure ME about SOHAR’s differentiation strategy from similarly positioned coastal gateways in the region, and future plans.

How can bundled port and free zone offerings serve a country’s economic agenda?

A combined port and freezone is not a new phenomenon; examples of these kinds of ‘Plug and Play’ operations and their beneﬁts can be seen around the world, especially in terms of their ability to drive economic growth. Harnessing efficient sea transportation links and creating a competitive environment for international investment also brings in external revenue sources that can boost

INFRASTRUCTURE MIDDLE EAST

April 2015

direct income and also tax revenues from business transactions and employment. However, at SOHAR and across the Gulf countries, the idea of adjoining infrastructures is as much about the enormity of growth as it is about the opportunity that they present for diversifying the economy. This is a common pursuit across the Gulf, but it must be achieved strategically given the region’s heavy dependence on oil. For example, by attracting downstream plastics industries to complement the food cluster we’re building at the port, we’re able to promote the growth of petrochemicals through the freezone, during a transition that many will have to deal with as oil reserves run out. Another example is the raw materials that are brought to SOHAR by Vale every two weeks, which has spurred the development of downstream metals processing industries at the port and freezone. This has also

“At SOHAR, we also have the added advantage of being located at the tip of the Arabian Peninsula, which means goods can be offloaded much sooner than if they were shipped to ports inside the Gulf” EDWIN LAMMERS, EXECUTIVE COMMERCIAL MANAGER OF SOHAR PORT AND FREEZONE

created thousands of new local jobs – another national priority – and looking at the global climate change agenda, we’re working with tenants to explore opportunities to turn their waste into raw materials required for production by other plants. Such tight-knit supply chains are the key to reducing waste, and will help Oman, which has one of the world’s lowest carbon footprints, to continue meeting its international obligations. What are the key benefits of integrating ports and free zones? How can these benefits be extended to the rest of the economy?

We live in a world where people want things now. While the Internet allows you to order an item with the click of a mouse, supply chains don’t always work like that. Getting goods to customers will always be about efficiency but eventually, you reach a point where it is hard to make things quicker. From a logistical point of view, integrating ports and freezones is one way of bringing businesses closer to distribution networks. At SOHAR, we also have the added advantage of being located at the tip of the Arabian Peninsula, which means goods can be offloaded much sooner than if they were shipped to ports inside the Gulf. With railway connections, they can be in the UAE, for example, in an hour from the time they leave the terminal (proposed) linking SOHAR and the GCC Railway. Rail, along with the new expressways and the newly-opened Sohar Airport, holds the key to extending these beneﬁts across Oman. The GCC Rail network will link all of Oman’s sea terminals and speed up supply chains,

TRANSPORTATION

allowing the country to take full advantage of its position as the gateway to the Gulf. In fact, the announcement that Oman is moving ahead with its railway plans increased the number of enquiries at SOHAR, so you can imagine the kind of growth we expect when the rail services ﬁnally come online. To prepare for this growth, we have plans to expand the container terminal to 4.5m TEU by 2018. More investments are being channelled into other terminals and cargo volumes are projected to grow beyond current throughput of 50m tonnes. In your experience, what are the factors driving a successful freezone and port combination?

Successful port and freezone developments are those that offer a seamless process for getting goods in and out of ports, on and off ships, and to their intended destination at the appropriate time – whether that is the freezone or further afield. This is influenced by a number of things, but at SOHAR we focus on just one: customer service. This can be hard to achieve when you’re only responsible for goods for a short time in their journey from manufacturing to sales, but it is something we see as a necessary investment. To be able to offer seamless customer service, the port and freezone needs to be fully integrated, right from the software used to prepare for the arrival of ships to the heavy lifting equipment available at the docks. People and processes are essential, and while location can play a role in the success, a competitive freezone with room to grow has proven equally vital in a region, where to a certain extent, space is at a premium. Businesses at ports like Jebel Ali, for example, are finding expansion plans tough to accommodate or too expensive. With a 45 sq km freezone operated on tenant basis, SOHAR is increasingly being seen as a viable, affordable, and convenient business solution, now and also for the foreseeable future. To what extent is the freezone contributing to port traffic?

Traffic at SOHAR crossed the 2,000 vessels milestone last year, which is an almost unbelievable 4,700% growth during the last decade. The vessels are also getting bigger, which is a great multiplier. Last year, we welcomed our ﬁrst ever 10,000 TEU vessel, the APL Savannah. Many of these ships are brought to SOHAR by industries at the port, including Vale’s 400,000 deadweight tonne ‘Valemax,’

“People and processes are essential, and while location can play a role in the success, a competitive freezone with room to grow has proven equally vital in a region, where to a certain extent, space is at a premium” EDWIN LAMMERS, EXECUTIVE COMMERCIAL MANAGER OF SOHAR PORT AND FREEZONE which delivers millions of tonnes of iron ore from Brazil fortnightly, but the number of ships serving the freezone is also increasing steadily. Deals with Oman’s big auto distributors – Saud Bahwan and Suhail Bahwan – have brought pre-inspection and other related services to the freezone and with it, the number of cars handled at the multipurpose cargo terminal operated by C Steinweg Oman doubled during 2014 to more than 200,000 units annually. With more and more countries in the region opting for bundling ports and free zones, what is your differentiation strategy?

Our strategy has been to leverage our strategic location outside the Strait of Hormuz. It also helps that we have a highly experienced ally in our joint venture partner, the Port of Rotterdam. We recognise SOHAR is not unique

in its status as a joint venture, but few ports in the region have been successful in attracting a partner of the calibre of Port of Rotterdam, which at the time the deal was signed in 2002, was the world’s busiest port. This partnership gives us access to Rotterdam’s Global Port Network, which includes an ambitious Greenfield port in Latin America called Porto Central. As part of a bold vision to create a sustainable and multipurpose deep water port in Latin America, this network is creating organic business opportunities for SOHAR too. More importantly, it is the expertise which exists within this network that has been the catalyst, enabling SOHAR to grow quickly and develop into a logistics hub capable of challenging its rivals. Our constant endeavour to meet the highest international standards doesn’t mean we get everything right the first time. However, SOHAR didn’t have to reinvent the wheel or waste time and money on trial and error either. This has made investors confident in our ability to work the $15bn that has already been invested in SOHAR into suitable returns for their businesses. It is also helping us deliver on our aim of becoming the region’s preferred port and freezone. This vision is built on six pillars: strengthened connectivity, global expertise, expanding industries, stable investment, personalised service, and sustainable futures. How is technology being leveraged to ensure smooth flow of goods, information and documentation at the port and freezone?

Technology plays a big role in our current operations and plans for the future. Last year, we joined forces with Belgian software developer Phaeros to replace SOHAR’s port management system. This included the installation of two new systems as part of a long-term agreement. One of them is ‘View Plus’, which lets harbour masters and port controllers capture information about ship movements and make important operational decisions. The other one is ‘BillSys’, which will streamline invoicing. This is one of the more difficult processes in the industry due to the complexity of contracts, different charges applicable, and challenges in obtaining sufficient operational data. Meanwhile, in the coming months, we will ﬁnalise plans for truck appointment and gate automation systems that will help distribute daily workﬂows and allocate resources at the port.

April 2015

INFRASTRUCTURE MIDDLE EAST

TECHNOLOGY

DECISION SUPPORT

Single version of truth Majis, the water utilities solution provider to Oman’s Sohar Industrial Port Area (SIPA), enhanced its visibility and asset availability by implementing Enterprise Resource Planning (ERP) ince its inception in 2006, Majis’ roots were in providing seawater for cooling the tenants of Sohar Industrial Port Area (SIPA), Oman. Majis was using a small ﬁnancial package and a mixture of spreadsheets and databases to manage its operations. All data was entered manually, for example, and staff was managing maintenance, inventory, and procurement with spreadsheets and databases. Even back-end operations were very manual and cumbersome. If an employee applied for leave without pay, there was no visibility from management, to resourcing, through HR to payroll to administer this simple task; it was all manually entered. Majis lacked visibility into daily operations, there was no consistent process followed by departments, work was cumbersome and errors with data entry were incurred. “This impacted the ability to make decisions

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April 2015

in real time, which affected the business,” says Emad Al-Manthari, Head of Information Technology, Majis Industrial Services. The operation and maintenance of Majis’ assets were outsourced to Azaliya, a Veolia company. There was no single version of

“With one system that both Majis and Azaliya enjoy, we have complete visibility of the plant, asset lifecycle, inventory stockpiles so that we now achieve operational efficiency” EMAD AL-MANTHARI, HEAD OF INFORMATION TECHNOLOGY, MAJIS INDUSTRIAL SERVICES

truth that existed between the two companies on asset performance, maintenance history, spare parts ordered and inventory supplies. If a water pump was down, sometimes there was duplication of staff allocated to ﬁx the pump, there was no clear asset record to view the history and often, there was the duplication of multiple spare parts ordered to repair the pump. “We needed to address the visibility and work in unity with Azaliya to ensure we were running at the highest level of plant availability with 100% asset optimisation,” says Al-Manthari. Majis expanded its footprint to become a complete water utilities solution provider and required an integrated ERP solution that could manage assets, procurement, ﬁnance and human resources. INVESTING IN THE BUSINESS

“We went to tender, but it was IFS Applications that was the standout solution for us. The rich functionality in IFS Applications was more

COVER STORY

advanced to meet the needs of our business whilst being highly competitive. The IFS Middle East team gave us the conﬁdence that the project would be implemented on time and on budget and would be able to grow with us,” says Al-Manthari. By implementing IFS Applications, Majis has optimised operational efficiency coupled with gaining extensive functionality to support asset optimisation, procurement and inventory planning to support Azaliya. “Implementing IFS Applications allowed us to integrate all our departments with one system where we gained business intelligence and access to information in real-time from any location,” says Al-Manthari. The integration of ﬁnance, human resources and document management has improved planning, scheduling, and work force optimisation whilst achieving greater control over production costs. With the implementation of Health and Safety, Majis is now fully accountable and can take the necessary procedures to deal with any issue. Majis increased collaboration between Azaliya, improving complete visibility of assets, procurement and inventory, whilst achieving the highest possible level of plant availability. “With one system that both Majis and Azaliya enjoy, we have complete visibility of the plant, asset lifecycle, inventory stockpiles so that we now achieve operational efficiency,” says Al-Manthari.

§ Implementing IFS Applications allowed us to integrate all our departments with one system where we gained business intelligence and access to information in realtime from any location” EMAD AL-MANTHARI, HEAD OF INFORMATION TECHNOLOGY, MAJIS INDUSTRIAL SERVICES Majis has complete visibility of inventory stockpiles and can order parts when required whilst Azaliya proactively operates and maintains the assets ensuring plant availability. This means that Majis can focus 100% of our efforts on the commercialisation of water and Azaliya can dedicate 100% focus to maximising plant availability. The added beneﬁts of IFS Applications is that employees at both Majis and Azaliya can work anywhere in real-time. Majis use IFS touch apps IFS Notify Me and IFS Talk for mobile devices that enables employees to approve purchase orders, expenses, invoices etc. anywhere and collaborate with other staff

in real- time. “This has helped to increase operational efficiency,” says Al-Manthari. “Training staff to use IFS Applications could never be easier,” says Al-Manthari. “IFS Applications has easy to search functionality, saving favorite screens and post-it notes has enhanced communication between colleagues. IFS Applications is so user friendly and the intuitive nature sometimes means I don’t need to contact the IFS support team, I can solve the issue myself.” WORLD CLASS OPERATIONS

Implementing IFS Applications has elevated Majis ability to be agile and successfully operate in the commercialisation of water whilst achieving 100% plant availability with Azaliya. “Our CEO loves IFS Applications because it gives him the business intelligence in real-time to accurately manage forecasts, risk management and business operations to make informed decisions that impact the business,” says Al-Manthari. By having information in a central repository means the wealth of knowledge has increased across the business and employees. Even Azaliya has reported beneﬁts towards achieving 100% plant availability. “I would completely recommend IFS Applications to any asset intensive business as we have seen huge improvements in the way we operate. Most importantly, it’s the right solution to support our business,” says Al-Manthari.

Majis has outsourced the operation and maintenance of its assets to Azaliya

April 2015

INFRASTRUCTURE MIDDLE EAST

CONSTRUCTION

BUILDING EXCELLENCE

Making the grade The GCC region’s construction industry is raising the bar with regard to project quality, delivery and sustainability oncerns about project quality, delivery and sustainability are a constant fixture of conversations on the Gulf region’s project environment. Of course, consultants who have worked on projects in the UK and the US opine the region has a better track record than their own countries as well as the fast-growing economies of Asia and Africa when it comes to critical infrastructure projects. Yet the feeling lingers that the region’s financial clout, underwritten by oil revenues, is not sufficient to enforce excellence in projects across infrastructure sectors, barring oil and gas. Therefore, when an awards programme that ‘aim (s) to raise the standard of business projects through benchmarking best practices specified in project briefs and excellence provided in project delivery,’ enters its fifth cycle, the endurance, in itself, is a positive indicator of improvements on the ground. “A top quality project is one that is distinguished by its vision and the extent to which this vision is shared by all those participating in delivering the project and all those affected by it,” says Edmund O’ Sullivan, Chairman of the judging panel of

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April 2015

the MEED Quality Awards for Projects, in association with Mashreq. “If there is perfect alignment, there will be a perfect project.” Since 2011, when the ﬁrst MEED Quality Awards were announced, more than 200 projects have now been recognised as national, GCC and supreme winners, and the bar continues to rise. For example, this year’s UAE national winner in the category of Ramboll Sustainable Project of the Year is Al Barari (entered by Al Barari Firm Management, the project’s owner). Mustafa Saaid, Developments & Projects Director, Al Barari Firm Management attributes the success to the company’s vision to create one of the most desirable developments in the UAE with a strong environmental conscience. Located in Dubai, Al Barari boasts of themed gardens, naturally landscaped lakes, and freshwater streams, cascades and waterways, creating a green oasis in a city dotted with skyscrapers. “In Dubai’s climate, it is important to have plenty of green space which reduces heat build-up and breaks up reﬂected heat from hard surfaces, such as villas and pavements, to produce a cooling effect,” says Saaid. “Through the shade they offer, trees can buffer homes from extreme heat and reduce energy consumption and air-conditioning costs.”

The combination of natural shade canopy, created by the landscape’s high density planting, the numerous waterways, and the clusters which were designed to direct the wind flow from the desert or sea throughout the community has created Al Barari’s own microclimate, with temperatures 3-5°C below that of the surrounding developments. “As a result, Al Barari offers improved ground water recharge, energy savings from reduced air conditioning, reduced greenhouse gas emissions, reduced urban heat stress and reduced sewer overflow,” says Saaid. Sustainability systems in place in Al Barari include shading, daylight harvesting, solar power, thermal massing, cross ventilation, composting, smart control irrigation, radiant cooling, waste management, recycling and water treatment. The benefits of these measures are lower power and water consumption, efficient energy usage, and minimal wastage, all of which are in line with the municipality’s sustainability initiatives. CHASING EXCELLENCE IN BAHRAIN

Bahrain’s national winner in the Ramboll Sustainable Project of the Year category, the Muharraq Sewage Treatment Plant (STP) and Sewer Conveyance Project (owned by Bahrain’s Ministry of Public Works), has a similar story of excellence to share,

CONSTRUCTION

Sang-Don Min Project Manager, Samsung Engineering

shafts (up to 10m in diameter and seven stories deep) in busy residential areas, in some locations only 1m from existing houses and businesses. Samsung had to expend huge efforts in terms of traffic planning, and pre and post tunnel surveys to identify the impact on settlements along the tunnel route, public consultations and coordination with other projects to identify and mitigate the impact of the project work on public, business and traffic movements. “The project was implemented to the highest environmental standards,” continues Sang-Don. “Throughout the construction phase, it was inspected and audited monthly by the Supreme Council of the Environment and the project company’s own environmental consultant to monitor compliance, and to look for ways to minimise the construction impacts on the local population.” ESSENTIAL LEARNINGS

especially on the engineering front. “What makes it (Muharraq STP) stand out most from similar projects is our commitment to provide the best solution with comprehensive project management skills for the entire project execution process, including implementing the sewer network using the micro-tunnelling method,” says Sang-Don Min, Project Manager, Samsung Engineering Company, the project’s Engineering, Procurement and Construction (EPC) contractor. The project’s objective was to upgrade an existing and overloaded STP and replace a difficult-to- manage and unreliable sewage network, which regularly discharged untreated sewage into the sea. “The completed project (which started operations in April 2014) has achieved these goals,” says Sang-Don. “The STP produces 100,000 m3/day of high quality treated sewage effluent (TSE) suitable for unrestricted reuse across Bahrain. The network capacity has been increased, made completely reliable, is easier to operate, is significantly more energy efficient and creates no environmental or public nuisance. The project was also completed on time without any lost time injury.” Unlike many single-site engineering projects, the network element of Muharraq posed a unique challenge as it involved the construction of approximately 100 tunnel

With regard to the scope for further improvements in the region’s project environment, Sang-Don observes that despite being a ‘first of its kind’ deal for Bahrain, the Muharraq STP project benefited from a very good set of project documents, features of which were taken from other project sectors. His comments on the key factors that helped smoothen the project’s implementation are reproduced below: Technical requirements: These were clearly defined within a set of performance specifications and guarantees that focused on what the plant should achieve in operation rather than how it should be built. The client retained approval rights for the entire design and construction phase but was able to steer the project with a ‘light touch’ in the knowledge that the plant’s ultimate performance (for 26 years) remained at the risk of the contractor. This approach, with suitable pre-qualified contractors and a reasonable level of mutual trust and transparency, helped the project focus on the important questions, i.e. timeliness of delivery and performance, rather than the minutiae of project delivery.

provided and resourced as required. Early on, the Muharraq project was behind schedule due to difficulties in obtaining planning permission for the network route. Twenty-seven authorities were impacted by the project and it took time for these stakeholders to understand the specific construction impacts and needs of the project. Resolving this required significant coordination inputs from the client and Bahrain’s Central Planning Office (CPO) through public consultations and planning workshops. Although the contractor employed a Bahraini Community Liaison Officer and a Technical Interface Officer, the client’s assistance was essential to resolve some of these issues. All three spokespersons agree that communication and collaboration are fundamental to avoiding and resolving disputes that could act as a drag on projects. “Contracts are the papers on which disputes are raised and argued and these should have mechanisms in place to deal with disputes,” says Al Barari’s Saaid. “It is not contracts that create disputes – rather, it is the lack of a proper relationship and communication causes most disputes.” He notes that it is the responsibility of teams on both sides of the contract to deal with problems as and when they arise by carefully considering the problem at

Project approvals and client assistance:

Approvals from other authorities or governmental bodies can often be difficult and contracts should be structured such that the contractor retains responsibility, but at the same time, assistance is

Mustafa Saaid Developments & Projects Director, Al Barari Firm Management

April 2015

INFRASTRUCTURE MIDDLE EAST

CONSTRUCTION

hand, consulting all the relevant people and taking an informed decision. “Lack of decisions and uncertainty lead to delays and without effective communication, the problem gets exacerbated,” says Saaid. “Therefore, ensuring proper communication lines and making informed decisions on time cut out the majority of disputes and improve project delivery.” “The best approach to managing a client’s expectations is by giving them regular updates, being fully transparent and avoiding surprises,” adds Samsung Engineering’s Sang-Don. “A client-contractor relationship is not purely about executing projects; the human element, or attitude, is important to avoiding disputes by creating the type of relationship whereby both parties would prefer to resolve issues amicably.” “To reduce disputes, you need to address the problem at the source,” says MEED’s O’Sullivan. “And this means ensuring all parties to a project are aligned and collaborate. People need to be partners and, preferably, friends.” He observes that project performance in the region can be improved through effective quantification of the long-term projects market and the demands they will make on human and material resources;

Muharraq STP

INFRASTRUCTURE MIDDLE EAST

April 2015

Edmund O’ Sullivan Chairman of the judging panel of the MEED Quality Awards for Projects, in association with Mashreq

effective procurement; value chain focus; sustainability and lastly, strong governance. “Great projects well executed deliver massive amounts of value, much of it monetisable. Governments, therefore, need to have effective project delivery projects, an approach the GCC has successfully applied

in the oil and gas sector,” says O’Sullivan. All three are also keen to see the region benefit from the knowledge created and acquired during the course of developing and delivering mega projects. O’Sullivan says: “The Gulf countries are taking steps to ensure that more of their people are employed in valuecreating parts of the projects sector including planning, design, engineering, project management, asset management and financial and advisory services. The numbers are, however, still too low and should be doubled in the next five years.” According to Sang-Don, local infrastructure needs will eventually flatten out as the built environment meets the demands of the local populations. He believes that the capacity to export these skills, and possibly investment, to similar projects in less developed parts of the world remains enormous, particularly where more basic needs such as housing, electricity and water are deficient. Saaid notes that the industry should learn from its mistakes and use this knowledge for future projects. He says: “It would be great to see investment in projects that support sustainability and education, such as more green spaces and museums.”

INFRA PEOPLE

WSP | Parsons Brinckerhoff’s senior leadership in the Middle East Parsons Brinckerhoff have announced the senior leadership in the Middle East for the newly formed company, following WSP’s acquisition of Parsons Brinckerhoff last year. Former Middle East Managing Director of WSP Tom Bower has been announced as Middle East Managing Director for the combined company, which now has 32,000 people globally and 1,450 in the Middle East. Tom has worked at WSP for 16 years, in various senor roles including

Commercial Director for the UK before being appointed as Managing Director for the Middle East business in 2010. Former managing director for Parsons Brinckerhoff, Middle East and North Africa, Anas Kassem, who has spent almost 30 years in the industry including 15 in the Middle East and is a licensed Professional Engineer in the US, is the Executive Chairman of the new company. WSP acquired Parsons Brinckerhoff in October last year for $1.25bn.

Point of View

Dr Hisham Khatib, Honorary Vice Chairman, World Energy Council & Advisory Board member, POWER-GEN Middle East

New GPCA chief The Gulf Petrochemicals and Chemicals Association (GPCA) has announced the appointment of its new Chairman, HE Rashed Saud Al Shamsi. Having been the Vice Chairman of the GPCA since 2012, Al Shamsi steps into the shoes of GPCA’s former Chairman Mohamed Al Mady, who was recently appointed as the Chairman of the General Organisation for Military Industries through a Royal Decree issued by HRH King Salman bin Abdulaziz Al-Saud, King of Saudi Arabia. He assumes his new role immediately, following a rigorous voting process by GPCA’s full member companies. As Director of Petrochemicals at the Abu Dhabi National Oil Company (ADNOC), Al Shamsi has nearly 30 years of experience in the region’s downstream sector. He is currently the Chairman of the Board of Fertil (Ruwais Fertilisers Industries) and the Chairman of the Board of Borouge pte, the marketing arm of Abu Dhabi Polymers Company (Borouge) and the Vice Chairman of the Board of Abu Dhabi Polymers Company (Borouge).

Abu Dhabi Airports appoints CEO Abu Dhabi Airports has announced the appointment of HE Eng. Mohamed Mubarak Al Mazrouei as its Chief Executive Officer (CEO). He succeeds Tony Douglas, who stepped down to take up a new role with the UK government. Eng. Mohamed Mubarak Al Mazrouei possesses considerable experience in major infrastructure projects, and in the aviation and transportation sectors. He currently serves as a Board Member of Abu Dhabi Airports and is also a Board member of Abu Dhabi Ports Company. He has previously served the country in the Armed Forces. Al Mazrouei holds a Bachelor of Science degree in Civil Engineering, from the University of North Carolina, Charlotte, USA.

The Gulf countries should look to reduce and phase out energy subsidies over a period time. In fact, recent announcements about reducing subsidies as lower oil revenues take a toll on public expenditure are ‘shy attempts’ and there is a long way to go. Other than energy subsidy, there is also a huge water subsidy as desalination is energy intensive. While other countries in the Middle East, like Jordan, Tunisia and Lebanon are already phasing out subsidies, the fact remains that they are minor power players. In Lebanon, for example, electricity theft is a bigger challenge than subsidies. I also feel that very little is being done when it comes to energy efficiency. Efficiency is very badly needed; it is the number one activity in terms of conservation and diversiﬁcation of energy. I also believe that the Gulf countries should concentrate on ensuring more efficient use of fossil fuels. As they run their own fossil fuel power plants, they possess considerable expertise in that sector. But in the case of nuclear energy, everything – knowledge, material and management – has to be imported; fossil fuels, on the other hand, are available locally. Based on my personal experience, I feel that nuclear and renewable energy are minor players compared to fossil fuels. Using clean coal is a wise step in the long term because coal is the cheapest source of electricity worldwide.

April 2015

INFRASTRUCTURE MIDDLE EAST

EXECUTIVE INSIGHT

Paul Baker

“People’s safety is of prime importance when addressing security challenges”

Smart checkpoints Paul Baker, Managing Director, Smiths Detection Middle East on enhancing the efficiency of airport security checkpoints nprecedented economic growth together with the opportunity to host mega global events like the Expo 2020 in Dubai and the FIFA World Cup 2022 in Qatar have encouraged the Gulf Cooperation Council (GCC) countries to invest heavily in key infrastructure projects. Projects worth nearly $4.3tn have been announced in the airport sector alone, throwing up tremendous growth opportunities for the region’s aviation sector. In the UAE, the aviation sector has established itself as an integral part of the economy, with a share of more than 14.7% of the Gross Domestic Product (GDP). Dubai Airports is expected to overtake Atlanta and Beijing within the next 10 years to become the biggest aviation hub in the world, having overtaken London’s Heathrow as the number one airport for international passenger numbers. Passenger traffic at airports in the UAE and the larger region has recorded a fast paced growth. As per the ﬁndings of a recent IATA report, passenger numbers in the UAE are expected to increase at a rate of 5.6% annually until 2034. Dubai International

INFRASTRUCTURE MIDDLE EAST

April 2015

Airport alone is inching closer to handling 71m passengers by the end of 2015. With the exponential increase in passenger traffic, airport operators in the region are now keen on implementing smart solutions that are aimed at enhancing the airport’s operational efficiencies. They are not only looking at offering a seamless and hassle-free experience for passengers but also re-deﬁning and revolutionising their travel experience. Their key focus is on getting the growing number of passengers through existing checkpoints safely and quickly, without creating bottlenecks. This is where automated processes can contribute to smoother procedures, improved networking capabilities between different checkpoints and remote screening operations. AN INNOVATIVE SOLUTION

Incorporating smart solutions at checkpoints will allow operators to gather real-time and historical data for analysis, allowing them to share information, monitor the entire screening operation remotely for earlier intervention. One of our latest security solutions – Checkpoint.Evo – enhances the inspection and integration capacities of airport security

checkpoints. Its centralised remote screening helps speed up inspection of hand luggage, as image evaluation and alarm resolution can be centrally monitored away from the noise and distractions of the checkpoint. In addition, the advanced recheck functions of Checkpoint.Evo electronically mark suspicious areas in bags, to enable a more focused search for illegal items by on-the-spot operators. Also, Checkpoint.Evo’s data management capabilities offer real-time and historical data for analysis and reporting, which allows airport operators to share information and monitor the entire screening operation via remote portable devices, such as tablet PCs. People’s safety is of prime importance when addressing security challenges. While the main focus is to ensure that airports and critical establishments have the most advanced screening and detection solutions, it is equally important to develop security solutions that not only safeguard critical infrastructure and enhance operational efficiencies, but can signiﬁcantly improve passenger experience. In that sense, Checkpoint.Evo meets both the current and future requirements of airport operators in the region.

EVENTS

COMING SOON

POWER-GEN AFRICA & DISTRIBUTECH AFRICA 2015 15-17 JULY 2015, Cape Town

Mark your diary... ICS CYBER SECURITY FORUM 10 – 14 MAY, 2015 ABU DHABI The 3rd ICS Cyber Security Forum

he 3rd annual POWERGEN Africa and 2nd annual DistribuTECH Africa conference & exhibition return to Cape Town from 15-17 July 2015 at International Convention Centre, Cape Town, Republic of South Africa. These premier events will cover all aspects from power from conventional and renewable generation to supply and delivery including worldclass conferences sessions, a guided technical tour and comprehensive exhibition ﬂoor. The 2014 edition was attended by over 2,300 visitors attended from over 69 countries,

representing six continents. Moreover, 61% of visitors came from 28 countries across Africa. The organisers are offering an Early Bird Discount of 17% on registrations before 17 June 2015 at www.powergenafrica. com and www.distributechafrica.com

will discuss risks and mitigation of cyberattacks in the utilities and hydrocarbon sectors. Contact: Neha Malhotra Tel: +971 2 674 4040 Email: neha@ domeexhibitions.com www.csuae.org AIRPORT SHOW

Contact: Sue McDermott Tel: +44 992 656 632 Email: suemc@pennwell.com www.powergenafrica.com

11 – 12 MAY, 2015 DUBAI Now in its 15th year, the Airport Show is the world’s largest annual airport exhibition and a key procurement platform for

MENASOL 2015 13-14 MAY 2015, Dubai

airport developments in the

ENASOL 2015 is the largest dedicated solar industry event in the Middle East and North Africa which brings together leading international and local investors, developers, EPC and suppliers to discuss future large-scale solar strategy, new plant opportunities and to launch new products and services into the market. Day 1 of MENASOL is dedicated to PLENARY SESSIONS – from investment and bankability to policy announcements and regulation, while Day 2 splits into the PV TRACK and CSP TRACK. These premier events will cover all aspects from power from conventional and renewable generation to supply and delivery including world-class conferences sessions, a guided technical tour and comprehensive exhibition ﬂoor. MENASOL is also complemented with a joint PV and CSP exhibition zone. The plenary sessions will focus on MENA solar markets, Egypt’s new Feed-in-Tariff for

Contact: Raed El Forkh

Middle East, Africa and Indian subcontinent region. The event is co-located with the Global Airport Leaders’ Forum (GALF).

renewable energy plants, Morocco’s future plans, NEPCO’s plans for sustaining renewable energy growth to identify the future MW’s up for grabs in Jordan’s energy mix, DEWA’s official announcement on accelerating the timelines of the Solar Park, Kuwait Oil Company’s plans to develop several hundred MW’s of PV and CPV and Appetite for project ﬁnance in MENA. The PV TRACK will cover project updates from winning PV bidders in MENA, country breakdown of where PV components will be manufactured in the MENA and how the Round Two tender in the UAE has impacted other solar procurement programmes in MENA.

Tel: +971 2 409 0484 Email: raed.elforkh@ reedexpo.ae www.theairportshow.com FM EXPO 19 – 21 MAY, 2015 DUBAI FM EXPO is the region’s largest and most established event focused on the facilities management industry. This year includes Free Certified Workshops and the World FM Congress. Contact: Cresida Aguiar Tel: +971 4 445 3699 Email: CresidaAguiar@ dmgeventsme.com

Contact: Brandon Páramo Tel: 1800 814 3459 ext 4302 Email: brandon@csptoday.com www.csptoday.com/menasol

www.fm-expo.com

April 2015

INFRASTRUCTURE MIDDLE EAST

INFRASTRUCTURE MILESTONES

#014 M Station The backbone of Dubai’s electricity and potable water supply system is also the largest power and desalination plant in the UAE he UAE’s largest power and desalination plant, which is owned and operated by the Dubai Electricity and Water Authority (DEWA) goes by the moniker ‘M.’ Located in Jebel Ali, M Station was officially opened by HH Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, Minister of Finance, and President of DEWA on April 8, 2013. Built at a cost of $2.72bn, the plant generates 2,060MW of power and 140 million imperial gallons per day (MIGD) of desalinated water. The plant has 6x234MW F-class gas turbines, 3x218MW steam turbines, eight Multi-Stage Flash (MSF) desalination units of 17.5 MIGD capacity each, 6 heat-recovery boilers, 2 dual-fuel ﬁred auxiliary boilers of 370

INFRASTRUCTURE MIDDLE EAST

tonnes/hour, and 16 fuel oil storage tanks (each with a capacity of 20,000m3) with total fuel oil storage of 320,000m3. M station’s design has built–in ﬂexibility to manage seasonal ﬂuctuations in demand. During winter, power demand usually reduces by half while water demand tends to vary 10-15% on the lower side. However, reduced demand for electricity means insufficient waste heat steam for the desalination process. M station is so designed that it can divert 80% of the steam produced to the MSF evaporators, which helps ensure that the desalination process is unaffected. Fisia, which supplied the desalination package, has claimed that the MSF units are the largest individual desalination units currently being operated in the world. At lower sea water temperatures, each unit can produce up to 19 MIGD. In an emergency scenario or if

April 2015

Fast facts Cost of the station: $2.72bn Power generation: 2,060MW Desalination capacity: 140 MIGD Expansion cost: $400m Permitted NOx limit: <25ppm

there is a shortage of natural gas, the gas turbines can burn diesel. At M station, the permitted NOx emission in normal operation is less than 25ppm. This is because combined cycle power plants achieve higher efficiency by making use of the same fuel twice while emitting less pollutants. M station’s water storage capacity is around 30 MIG; but if all the water storage points are considered, the station’s aggregate storage capacity is 100 MIG. Last month, DEWA awarded a $400m contract to expand the station, which will add 700MW to its existing power generation capacity, with two gas turbine generators, two heat recovery steam turbine generators, and one back pressure steam turbine. The project, which is expected to be delivered by 2018, will also increase the plant’s thermal efficiency from 82.4% to 85.8%.

I AM WSP PARSONS BRINCKERHOFF I AM WSP PARSONS BRINCKERHOFF #IamWSPPB

I AM PART OF THE WORLD’S MOST ICONIC PROJECTS I AM PART OF THE WORLD’S MOST ICONIC PROJECTS

EMERGING OPPORTUNITIES IN THE WORLD’S FASTEST GROWING CONTINENT

EARLY BIRD DELEGATE DISCOUNT SAVE AT LEAST $200 IF YOU REGISTER BEFORE 17 JUNE 2015

To register and obtain further information, visit www.powergenafrica.com or www.distributechafrica.com Owned & Produced by:

www.wspgroup.com I www.pbworld.com

Host Utility:

Presented by:

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ISSUE 014 | APRIL 2015

0/ "OX s *EBEL !LI s $UBAI s 5NITED !RAB %MIRATES T: +97 148 129 999 F: +97 148 129 900 E: salesme@lucyelectric.com

TRANSPORT

Consolidation trend M&A wave in the chemicals industry

Ruling the crossroads The port-freezone combo advantage

p18

p46

CITIES Aegis Plus

Gemini 3

Find out more about our Aegis Plus range and our next generation Gemini 3 RTUs at the Lucy Electric stand GSP-7, at WETEX, 21 – 23 April 2015.

CONSTRUCTION

Connected things Revenue opportunities in smart cities

Making the grade Construction industry raises the bar

p40

p50

You can also hear one of our automation experts explain the challenges and benefits of automation system design at a seminar held on [time/date].

DISTRIBUTED ENERGY

POWER PLANTS ON THE ROOF After cracking the utility solar PV puzzle, Dubai sets its eyes on rooftop solar

PLUS TOP 10 KSA INFRASTRUCTURE PROJECTS