ISSUE 005 | JUNE 2014
IN FOCUS
Linking the kingdom SAR puts its weight behind freight p16 ANALYSIS
Rebound effect Non-oil sectors benefit from global revival p20 CONSTRUCTION
A green future Green building codes boost MEP industry p42 AVIATION
High fliers Sustaining the region’s aviation success p46
EXCLUSIVE INTERVIEW
PROFITABLE GROWTH EQUATE sets industry benchmarks under President and CEO Mohammad Husain
PUBLICATION LICENSED BY IMPZ
PLUS TOP 10 BAHRAIN INFRASTRUCTURE PROJECTS
INTRODUCTION
Cooling rules GROUP GROUP CHAIRMAN AND FOUNDER DOMINIC DE SOUSA GROUP CEO NADEEM HOOD GROUP COO GINA O’HARA
ast month’s cover story looked at why the district cooling industry, despite obvious benefits, is yet to establish itself as a critical utility in the region. In the course of working on this story, it quickly became clear that the industry’s structure left the end-user, who should have been the real beneficiary, out in the cold. A flat capacity charge meant efficient use of air-conditioning went unrewarded while making district cooling a tad more expensive than traditional cooling. Other than that, the industry also had its share of technical, operational and regulatory challenges. However, Dubai’s district cooling sector could be heading for a makeover. At a recent workshop on Smart Cities organised by Clean Energy Business Council (CEBC), Taher Diab, Director Strategy and Planning, Dubai Supreme Council of Energy (SCE) said the council is developing a regulatory framework for the district cooling industry, which will ultimately deliver better pricing for the customer. District cooling is one of the eight programmes that constitute the SCE’s Demand Side Management (DSM) strategy. The end objective of this programme is to increase district cooling’s market share from under 20% currently to 40% by 2030. The council is currently overseeing the development of technical standards that seek to improve the operational efficiency and performance of district cooling plants. According to Diab, the use of treated wastewater in place of potable water will become a mandate as will the implementation of thermal storage. The council has circulated the draft of the new regulations within the industry to get its feedback. These regulations, slated to be announced by the end of this year, will hopefully make district cooling cost-competitive vis-à-vis conventional air-conditioning, which is not the case at present. Customers should find district cooling attractive enough to demand it rather than having it thrust on them. Ideally, the new regulations should also define a proper market structure for the industry, delineate the roles and relationships of the key stakeholders, whether they are developers, service providers or retailers, and incentivise them to do their best. Dubai helped pioneer utility-scale district cooling in the region. The emirate could once again show the way in making district cooling a cost effective, customer-friendly and sustainable cooling solution for homes and businesses.
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PUBLISHING DIRECTOR RAZ ISLAM raz.islam@cpimediagroup.com +971 4 375 5471 EDITORIAL DIRECTOR VIJAYA CHERIAN vijaya.cherian@cpimediagroup.com +971 4 375 5713 EDITORIAL EDITOR ANOOP K MENON anoop.menon@cpimediagroup.com +971 4 375 5473 ASSISTANT EDITOR SHRUTHI SARAF shruthi.saraf@cpimediagroup.com +971 4 375 5715 CONTRIBUTING EDITOR ASHISH SARAF ashish.saraf@cpimediagroup.com +971 4 375 5495 ADVERTISING COMMERCIAL DIRECTOR JUDE SLANN jude.slann@cpimediagroup.com +971 4 433 2857 SENIOR SALES MANAGER JUNAID RAFIQUE junaid.rafique@cpimediagroup.com +971 4 375 5716 SALES MANAGER SANDRA SPENCER sandra.spencer@cpimediagroup.com +971 4 375 5473 MARKETING MARKETING MANAGER LISA JUSTICE lisa.justice@cpimediagroup.com +971 4 375 5498 MARKETING ASSISTANT BARBARA PANKASZ barbara.pankasz@cpimediagroup.com +971 4 375 5499 DESIGN ART DIRECTOR SIMON COBON SENIOR DESIGNER MARLOU DELABEN CIRCULATION AND PRODUCTION CIRCULATION AND DISTRIBUTION MANAGER ROCHELLE ALMEIDA rochelle.almeida@cpimediagroup.com +971 4 368 1670 DATABASE AND CIRCULATION MANAGER RAJEESH M rajeesh.nair@cpimediagroup.com +971 4 440 9147 PRODUCTION MANAGER JAMES P THARIAN james.tharian@cpimediagroup.com +971 4 440 9146 DIGITAL DIGITAL SERVICE MANAGER TRISTAN TROY MAAGMA Published by
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June 2014
INFRASTRUCTURE MIDDLE EAST
1
At the 2014 Construction Machinery Show we sold 70 units and 100 more units are under discussion. We have delivered a positive message to our existing clients, our competitors, and grabbed new clients. I think gaining such an appreciation from all members in the construction equipment sector is a great honour and will encourage us to work very hard to keep the same level of style, image, and standards.”
This year the CM Show team delivered an exhibition Saudi deserves. For years, we have seen a vision in this Show and this year the vision was achieved. We wanted quality traffic and we saw equipment and company owners; and we were able to offer some promotions to entice sales. I saw an increase in our sales immediately. Our principles, Doosan and Everdigm, really enjoyed themselves. We anticipate the upcoming years to be even better.”
The Construction Machinery Show was perfect from an awareness point of view. We explained Roots Group Arabia’s capability of covering the construction industry with all of its needs and requirements. The attendance was good especially during weekdays and towards the end of the exhibition. See you next year.”
Al-Qahtani & Sons Khaled El Shatoury, Managing Director
Saudi Diesel Equipment Ahmed Alkooheji, Marketing Manager
Roots Group Arabia Abdulaziz Felemban, Brand Manager
Co-located with
Raz Islam Publishing Director raz.islam@cpimediagroup.com Mobile: +971 50 451 8213
Michael Stansfield Commercial Director michael.stansfield@cpimediagroup.com Mobile: +971 55 150 3849
CONTENTS
005 June 2014 30
COVER STORY
REGULARS
Profitable growth
06 Regional update
EQUATE, the GCC’s first international JV in the petrochemicals sector, continues to set industry benchmarks under its President and CEO Mohammad Husain. Report by Anoop K Menon TOP 10 FEATURE
Bahrain infrastructure projects
26
Though the smallest country in the GCC group, Bahrain is emerging as a significant player in the region’s infrastructure boom. Infrastructure ME showcases Bahrain’s mega projects line-up
DEWA’s rooftop solar plans; Salalah IPP in RFP phase; Qatar’s labour reforms
10 Global update
Gazprom’s China deal; Low roaming costs for MEA; Europe’s shale gas challenge
12 In focus
Fixing air congestion; GE’s distributed power plans; SAR’s rail agenda
20 Analysis
Global economic rebound to boost Middle East’s industrial growth
23 Infrastructure tenders 50 Infra Insight
Asset management adds value
51 Events 52 Infrastructure milestones This month: Khalifa Port
INDUSTRY SECTORS TECHNOLOGY
CONSTRUCTION
34 Engineering intelligence
42 A green future
CONSTRUCTION
UTILITIES
38 Performing under fire
44 Finding niche in scale
CONSTRUCTION
TRANSPORT
40 Between hangars and harbours
46 High fliers
Point clouds and scalable terrain models support Network Rail’s Great Western Rail Electrification Programme, which aims to upgrade one of the United Kingdom’s oldest and busiest railways
Given the spate of fires in the region’s high rises, Dr Jeremy Hodge, chief executive at BASEC explains why cable testing for fire safety is very important, especially when lives are at risk
Juergen Strommer, MD, Cavotec Middle East talks about his company’s key offerings in aviation, ports and maritime sectors, and successful projects Report by Shruthi Saraf
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INFRASTRUCTURE MIDDLE EAST
June 2014
The region’s MEP contractors are ready to push forward with renewed impetus thanks to the introduction of the green building codes in the GCC countries
Ranjit Singh, Managing Director, EMEA Region, at APR Energy tells Infrastructure ME how his company is raising the bar in the rental power business
Geographical location, deep pockets, effective decision-making and strong ties with Asia have contributed to the region’s aviation success Report by Shruthi Saraf
REGIONAL UPDATE
infrastructure, enough to meet the water requirements for around 500 homes.
UAE Dubai Electricity and Water Authority (DEWA) has signed a contract with CESI Middle East to provide consultancy services for connecting rooftop solar to the DEWA grid. The main objectives of the project, which will be implemented in three stages, are to assist DEWA with launching its distributed renewable connection programme and stabilising Dubai’s electricity supply. Additionally, CESI will help DEWA develop in-house capability to manage the interaction of its grid with renewable energy projects. Masdar has awarded four companies – Abengoa, Degrémont, Sidem/Veolia and
Dubai Canal Phase 2 of the project has been awarded to China State Corporation
Trevi Systems – with contracts for its energy-efficient desalination pilot programme. Each company will build and operate its own test plant to develop and demonstrate desalination technologies over the course of 18 months.
This timeframe will enable the companies to gauge the most efficient desalination technologies with the potential to be powered by renewable energy. The test plants will also provide 1,500 m3/day of potable water to Abu Dhabi’s water
set up Duqm Industrial Land Company that will invest in all the basic infrastructure and utilities necessary for investors to set up their facilities.
Oman Oman Power and Water Procurement Company has issued Request for Proposals to six major developers to build a new Independent Power Project (IPP) in Salalah. The shortlisted six are: EDF International of France; Japan’s Mitsui & Co, Marubeni Corporation and Sojitz Corporation; Korea Electric (Kepco) of South Korea, and Saudi Arabia’s ACWA Power. The successful bidder will develop, construct, operate and maintain the gas-fired 400 MW IPP at Raysut and Dhofar Generating Company’s existing 273 MW gas-fired power plant over a concession period of 20 years. The project’s commissioning is slated for the first quarter of 2018.
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INFRASTRUCTURE MIDDLE EAST
Dubai’s Roads & Transport Authority (RTA) has awarded a $105m contract to China State Corporation for Phase II of the Dubai Water Canal Project comprising the construction of bridges across the Canal on Al Wasl and Jumeirah Roads. “Works in Phase II will be completed in the final quarter of 2016 in line with the completion of Phase I of the project ,” said the RTA board chairman and executive director Mattar Al Tayer. Phase 1 includes the construction of a bridge on the Sheikh Zayed Road comprising eight lanes in each direction passing over the Canal course to enable free navigation 24/7. Dubai Water Canal connects Dubai Creek and the Arabian Gulf.
Special zone Port of Duqm has a JV partner in Port of Antwerp
PwC is providing financial advisory services, Fichtner is the Technical Adviser, while DLA Piper is providing Legal Advisory Services. Port of Duqm Company (PDC) has launched a new subsidiary to help support June 2014
the development of industrial clusters for investment within the adjoining Special Economic Zone (SEZ), reports Oman Daily Observer. PDC has been allocated 2,000 hectares of land for developing petrochemical, medium and heavy industries. PDC has
Spanish oil product transportation and storage leader CLH Group has entered into a joint venture with Oman Oil Refineries and Petroleum Industries (ORPIC) to set up a fuel storage terminal and multiproduct fuel pipeline in the Sultanate. The JV will be investing $200m between 2014 and 2017 on the Muscat-Sohar Products Pipeline (MSPP) project. CLH will also invest $7m for a 175,000 m3 capacity fuel storage terminal at Al Jifnain, which will be linked via pipelines to ORPIC’s two refineries at Mina al Fahal (Muscat) and Sohar, as well as Muscat International Airport.
REGIONAL UPDATE
and replacing the exit permit system under which workers are required to obtain their employers’ consent to leave the country with an automated system through the Ministry of Interior.
Qatar Qatar Petroleum (QP) said it would invest over $11bn to redevelop the Bul Hanine offshore oil field to prolong its life and increase its output. The project, which is currently at the pre-FEED stage, is one of the largest to be managed and executed by QP. In a statement, the company said, “the magnitude of this investment reflects the extent of project scope that includes new offshore central production facilities and a new onshore gas liquids processing facility at Mesaieed. This will be marked by a massive drilling campaign of about 150 new wells between now and the year 2028.” QP is implementing a redevelopment programme for its oil fields, which were originally
Bul Hanine QP is implementing a redevelopment programme for its oil fields
developed with older technology. Qatar has unveiled labour reforms in response to international criticism over its treatment of foreign workers building the infrastructure for 2022 FIFA World Cup.
Last month, Qatar’s Ministries of Interior and Labour announced plans to ease restrictions on foreign workers’ terms of employment. The proposals include abolishing the sponsor system, under which workers are bound to a single employer
Developing an integrated public investment management process is key to improving public investment efficiency in Qatar, says the International Monetary Fund (IMF) in its latest country report. According to the report, greater investment efficiency would provide better resource allocation and boost growth dividend, given the large size of the public projects and the compressed timetable ahead of the World Cup. But it also warns that while contracted metro construction costs appear relatively low at the moment, they are subject to the risk of cost overruns.
REGIONAL UPDATE
is expected to touch 3,200 MW, a growth of 7.7% compared to last year. Bahrain’s installed power capacity stands at 3,933 MW.
Bahrain Bahrain’s Economic Development Board (EDB) recently said that the kingdom’s non-oil sector is well positioned for growth this year following a sharp rebound in the oil sector in 2013. A key reason behind the nonoil sector’s growth is the launch of a number of infrastructure projects, worth $4.43bn, according to recent reports by Ministry of Finance. A number of infrastructure projects which were approved by the Gulf Development Fund are due to be launched in the coming months. The EDB expects non-oil growth to accelerate to more than 4% this year and even as the oil sector is likely to remain more
King Fahd Causeway A new parallel causeway will bring the GCC Rail to Bahrain
or less flat, headline GDP growth should come in at 3.5% - 4%. The EDB’s current estimate is 3.7%. Bahrain will spend $41.3m to strengthen and expand the national power grid in a plan that includes 60 medium
intensity projects (11 kW) and 430 low-intensity projects. This will be in addition to the construction and operation of 11 main stations and 180 substations, acccording to a report in Gulf Daily News. This year’s peak power consumption
Ingelheim products. Domestic production meets only 15% of the demand with imports accounting for the rest. Local companies primarily make generic drugs, while some also undertake under-license manufacturing and packaging on behalf of multinational pharmaceutical companies for supply in the domestic.
Saudi Arabia Prince Saud bin Abdullah bin Thenayan Al-Saud, Chairman of SABIC and the Royal Commission for Jubail and Yanbu, announced that SABIC is in the last stages of preliminary studies for constructing the world’s first Oil-to-Chemicals (OTC) complex in the kingdom. The OTC complex will comprise an innovative configuration of unit operations that will generate the world’s highest yield conversion of oil to chemicals. SABIC expects to utilise around 10m metric tonnes of crude oil at the complex to produce petrochemicals, and eventually advanced specialty chemicals in line with SABIC’s 2025 strategy. The complex is
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INFRASTRUCTURE MIDDLE EAST
Bahrain’s Transport Minister Kamal bin Ahmed Mohammed said that his country will finalise its part of the GCC Rail route within two months in association with the Minister of Municipalities. The 2,177km-long GCC Rail network will link all six Gulf states by rail for the first time. Bahrain’s share of the total length is 36 km. Bahrain will be connected to GCC Rail via Dammam through a 25km causeway to be built parallel to the King Fahd Causeway. The study for the same is expected to be completed by September this year. King Fahd Causeway Authority has been entrusted the task of overseeing the study.
Delivering value Prince Saud bin Abdullah bin Thenayan Al-Saud, Chairman of SABIC (left) with Rashed Saud Al Shamsi, Petrochemicals Director, ADNOC
expected to start up by the end of the current decade. Pharma major Boehringer Ingelheim has signed a deal with two Saudi companies for local production and distribution of its products. June 2014
Tabuk is a local drug manufacturing company while Cigalah is a healthcare distributor. Under the agreement, Cigalah and Tabuk will manage and drive complex secondary packaging projects for 26 Boehringer
Saudi Aramco has awarded Spain’s Técnicas Reunidas a $1.7bn contract for the execution of the Utilities and Common Area project within the Jazan IGCC (Integrated Gasification Combined Cycle) complex. The complex will become the largest gasifier-based power facility in the world to convert vacuum residue into synthesis gas (syngas). It will also be used in a combined cycle power plant to generate 2,400 MW of power.
REGIONAL UPDATE
its 2015-16/2019-20 second medium-term development plan to involve state agencies and bodies, he said, adding that the SCPD has put into consideration obstacles that impeded the previous development blueprint, mainly red-tape.
Kuwait Kuwait has entered into a series of contracts to secure supplies of Liquified Natural Gas (LNG). The country needs natural gas supplies for electricity generation, water desalination, petrochemical operations and for use in enhanced oil recovery techniques. State-owned Kuwait Petroleum Corporation (KPC) signed two contracts - a fiveyear deal with British Petroleum (BP) and a six-year deal with Royal Dutch Shell - which will provide Kuwait with around 2.5m tonnes of LNG a year over the next five-to-six years. The total value of the deals have been estimated at $15bn, and came after a $3.5bn
Gas shortage Kuwait’s power sector consumes 2.5m tonnes of LNG on a daily basis
contract between KPC and Qatargas for LNG imports. Kuwait is planning to launch 82 major projects this year, the Secretary-General of the Supreme Council for Planning and Development (SCPD),
Adel Al-Wugayan said. These encompass housing, education, health, airports, ports, oil & gas and infrastructure projects. Governmental allocations for development projects for 2013-14 and 2014-15 hit $36.2bn The SCPD will soon deliver
Kuwait has pre-qualified six international consortiums to bid for Al Zour project, one of the world’s largest refining projects with a capacity of more than 600,000 barrels per day. The six companies, shortlisted for the Al Zour project include JGC Corp of Japan, Fluor Corp and KPR of the US, the UK’s Petrofac, Italy’s Saipem, and TR Group of Spain, the Arabic language daily Al Rai said. The six consortiums will bid for three major packages in Al Zour contract totalling $9bn.
GLobAL UPDATE
Round Up Gazprom has signed a deal with China National Petroleum Corporation (CNPC) to export 38bn cubic metres per annum (bcmpa) of Russian gas to China. The total value of the 30-year contract is estimated to be $400bn. According to rating agency Moody’s, the gas discussions between Russia and China, running for more than a decade, finally came to fruition this year due to weakened demand for gas in Europe, severe environmental damage from coal-fired power generation in China and envisaged 7-8% annual growth in Chinese energy consumption. The total project investment will exceed $55bn over the 2014-19 period, even as both countries have agreed on a $25bn pre-payment, which will enable Russia to invest in exploration and pipeline construction to China. The GSMA has announced that senior leaders from nine major mobile operator groups, accounting for over half a billion mobile connections across 48 countries in Africa and the Middle East, are individually undertaking initiatives designed to reduce the cost of roaming for consumers across both regions. The nine operator groups are committed to a range of roaming initiatives that, in addition to addressing pricing, will improve regional connectivity and mobility, with a particular focus on improving routes for prepaid customers. UAE’s Etisalat is a member of the group. The rapidly increasing pace of mobile adoption has delivered huge economic benefits for
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INFRASTRUCTURE MIDDLE EAST
The Chayandinskoye field Gazprom has ambitious plans for the Asia Pacific market
the regions, with the mobile industry directly contributing $60bn to the sub-Saharan African economy or six per cent of GDP and $132bn to the economies of the Arab States, or approximately 5.5% of total GDP. Unconventional natural gas from shale formations will not be developed in Europe anytime soon because of the continent’s population density and a lack of fiscal and popular support for shale gas, the CEO of Norway’s state-owned oil company Statoil said on Platts Energy Week last month. “You need efficient rocks. You need fiscal arrangements
around these resources that make it investable,” Statoil chief Helge Lund said on the all-energy news and tva. A joint venture between Black & Veatch and AECOM has been selected by PUB, Singapore’s national water agency, to provide engineering services for Phase 2 of the Deep Tunnel Sewerage System (DTSS). Freeing up land for other higher-value developments, supporting the production of NEWater, improving energy efficiencies and leveraging the water-energy-waste nexus are some of the key sustainability goals of DTSS Phase 2.
A rural village in Africa Only 16% of the continent’s roads are paved
June 2014
Christine Lagarde, Managing Director, International Monetary Fund (IMF) has called upon African countries to make infrastructure a top policy priority to address near and long term growth challenges. Addressing ‘Africa Rising: Building to the Future’ conference in Mozambique recently, Lagarde said the continent needs to invest in energy, roads, and technology grids to close its infrastructure gap. “Over the past three decades, per capita output of electricity in Sub-Saharan Africa remained virtually flat,” Lagarde cautioned. “Only 16% of all roads are paved, compared with 58% in South Asia. These shortfalls represent huge costs to businesses and to people.” IMF has estimated the infrastructure investment needs for the region at about $93bn annually. “In most cases, the investments are large and upfront,” said Lagarde. “They need to be carefully selected, managed and implemented within a medium- to longterm budget perspective.” The European Union has hit ‘Broadband for All’ target, according to European Commission’s Digital Agenda for Europe Scoreboard for 2013. IHS and VVA data confirmed that basic broadband (consisting of xDSL, Cable, Fibre-to-thePremises, WiMAX, HSPA, LTE and Satellite technologies) is available to everyone in the EU. “The growth of e-commerce, public services and cloud computing in the EU all depend on high speed broadband growth,” said Alzbeta Fellenbaum, broadband analyst at IHS.
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IN FOCUS
AVIATION
Fixing airspace congestion Aviation authorities in the region should leverage the advanced technologies in today’s airplanes to tackle crowded airspaces. By Anoop K Menon ccording to the International Civil Aviation Organisation (ICAO), the investment in developing new facilities and expanding existing airports to meet the demands of the Middle East’s fast-growing airlines has resulted in airspace capacity becoming an ‘emerging’ issue, as current constraints limit capacity and force ‘inefficient’ routings. “But the good news is that new airplanes being added to the fleets in this region come equipped with the latest communication, navigation, surveillance and display technologies that will help them fly very efficiently in this crowded airspace, provided regulation goes hand in hand,” said Colin Mahoney, senior vice president, International and Service Solutions of Rockwell Collins. The US-headquartered company develops and deploys communication and aviation electronic solutions for both commercial and government applications. Mahoney pointed out that the transition from voice to data, in terms of how pilots and air traffic control communicate, is far more efficient, instantaneous and far less ambiguous, especially when it comes to language challenges. Under the LINK 2000+ Programme, the EU is implementing Controller Pilot Data Link Communications (CPDLC), which will supplement voice communication between pilots and air traffic controllers, increasing air traffic management capacity by automating routine tasks whilst improving safety. “Airspace is a finite commodity, so the ability to put more airplanes in that space is very critical,” said Mahoney. “Airplanes, particularly in this region, are coming equipped with all the technology necessary to manage the airspace efficiently from airborne hardware and airborne asset standpoints.” In the area of surveillance, for example,
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June 2014
Colin Mahoney Senior Vice President, International and Service Solutions of Rockwell Collins
Rockwell Collins recently launched its new MultiScan ThreatTrack weather radar for airplanes. This enables very precise navigation through poor weather in an automated way, allowing for efficient flying of airplanes. Another technology on the uptake among the airlines is Cockpit Display of Traffic Information (CDTI), which leverages the graphics capability of large format, landscape LCDs in the new airplanes to display traffic information. Mahoney explained: “Traffic computers on airplanes allow pilots to map the traffic around them in a large format LCD display. They can see what the air traffic control is seeing.” He pointed out that China has mandated the deployment of head-up displays (HUD) in airplanes to deal with the congested airspace in the country. HUDs display critical flight
information in the pilot’s forward field-of-view, eliminating the need for the pilot to repeatedly transition to the head-down instruments. This allows for lower landing minima and thus, more efficient use of airspace. China HUD Application Roadmap, rolled out by the Civil Aviation Administration of China (CAAC) last year, calls for 10% of capable in-service airline fleets to be equipped with HUD by 2015, and on all airline aircraft where a HUD is offered by 2025. Mahoney expects aviation authorities in the region to start similar initiatives, which takes advantage of the avionics and communication capabilities of new aircrafts. He said: “In this region, the growth rate in air traffic is twice that of the global average. Sooner or later, the region’s rapidly growing commercial fleet sector will call for solutions to the airspace congestion issue.” Mahoney feels that that the authorities are well aware of the congestion problem, given that half the airspace is reserved for military use. “They understand the need for military flights to coexist with commercial airplanes,” he said. “When we think about retrofits and upgrades of military airplanes, we do that with the mind-set of those airplanes needing to be Communication, Navigation, Surveillance/Air Traffic Management (CNS/ATM) capable, which gives them the ability to operate in military and commercial airspace throughout the world. In other words, a C130 can fly in the same airspace as a 787 with the knowledge that the air traffic infrastructure can deal with both airplanes in the same way.” Rockwell Collins is working with the commercial airlines in the UAE and beyond, to ensure that their planes are equipped with the right equipment to enable them to operate in a changing airspace environment. “We call it future proofing so that they can deal with the changes that will eventually come and fly with confidence in any part of the world,” said Mahoney.
IN FOCUS
INTERCONNECTION
Grid upgrade Alstom Grid has further strengthened the Gulf region’s main interconnection network with its portfolio of smart technologies lstom Grid, which set up the Gulf Cooperation Council Interconnection Authority (GCCIA) network, recently commissioned the new main control centre for the network in Dammam. The GCCIA project is the Gulf region’s first energy highway connecting the power grids of six member states through a 1.2 GW highperformance High Voltage Direct Current (HVDC) connection. With the construction of the new headquarters, the GCCIA wanted to put the main control centre in the new building and use the old one as a backup. “After GCCIA’s activities began to expand, in terms of managing the exchange of energy between the member countries, they wanted to expand their headquarters and staff and not be dependent on one control centre,” explained Karim El Naggar, Vice President-Network Management Solutions of Alstom Grid. “The fact that we were the original supplier of this system and enjoyed a good track record with GCCIA helped us to clinch the deal.” The control centre manages not only the energy trading and distribution between all the new GCC interconnected networks, but it is also the central communications centre for all existing network management systems in the six member countries. It guarantees the efficiency and safety of the power grid, enables the recording and billing of energy transactions between the different countries and also the operations on all interconnection substations of GCCIA. The new control centre replaces the old centre in Ghunan, which is now a back-up control centre. “The old control centre was the latest of its generation,” said El Naggar. “Since then, GCCIA has acquired had more expertise so we looked at their requirements and supplied with the latest solutions.”
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June 2014
Karim El Naggar Vice President-Network Management Solutions, Alstom Grid
Thus, the new control centre is equipped with a Wide Area Monitoring System (WAMS), which is a smart grid application for grid stability. The transient stability solution, which was built into the Energy Management System (EMS) was augmented; additionally, it has a new user interface, the e-terravision 3.0, which more focussed on situational awareness. “It is important for us to upgrade our systems in a relatively easy way,” said El Naggar. “The new GCCIA control centre is a perfect example of something which was inaugurated not so long ago, but which we upgraded relatively easily to the latest generation.” According to El Naggar, the new control centre with its upgraded systems will enable GCCIA to be more efficient in managing the electricity flow across the different countries. “Our latest solutions for online stability, transient stability and situational awareness implemented at the new control centre are all aimed at detecting a crisis situation much earlier than the previous generation could do,” explained El Naggar. “They can detect disturbances in seconds, help the operators
react faster and thus, have a better chance at avoiding potentially catastrophic failures across the network.” For example, the situational awareness solution was developed as a visualisation tool, drawing on experience and feedback from the utilities. “This tool allows grid operators to look at risk levels in a much more meaningful way, and with more anticipation,” said El Naggar. “Instead of waiting for an alarm to come up and signal that you are in a problematic situation, you can look at heat maps that will indicate the level of risks which will evolve but at least you have more anticipation. You have more intelligent visualisation that gives you an overall situation of the picture as opposed to specific points that are sometimes difficult to correlate with another event happening elsewhere. You can get thus a more holistic view of the situation. Today, operators have less and less time to react to a crisis. They have to have the full picture rather than trying to identify what is the length between different bits of information.”
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IN FOCUS
RAILWAYS
Linking the kingdom Saudi Railway Company (SAR) is steadily moving ahead with the freight transport component of its ambitious rail programme. By Anoop K Menon he ambitious railway developments underway in the Gulf region are expected to become a critical enabler for industry growth by facilitating intra-regional trade. In the case of Saudi Arabia, the Saudi Railway Company (SAR), a fully owned entity of the Public Investment Fund (PIF), is spearheading some of the biggest railway projects in the region the 2,750km, North-South Railway and the 950km Saudi Land bridge project. At the sixth Supply Chain conference, organised by the Gulf Petrochemicals and Chemicals Association (GPCA), Dr Rumaih Al Rumaih, Chief Executive Officer, Saudi Railway Company (SAR) presented an update on the two projects. The North-South Railway (NSR) project connects Riyadh with the North of the country. There are two key components to the project – one, connecting Al Jalamid in the North East to Ras Al Khair Port in the Eastern Province and two, connecting Riyadh with Al Haditha near the Jordanian border. Both components are in different stages of construction. The crucial mineral line, connecting phosphate mines at Al Jalamid and the
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“The Jeddah-Riyadh line is in the design stage, and we are planning to tender the same for construction this year” DR RUMAIH AL RUMAIH, CHIEF EXECUTIVE OFFICER, SAUDI RAILWAY COMPANY (SAR) bauxite mines at Al Baitha in Qassim province to the Ras Al Khair Port on the Arabian Gulf is 95% complete. Transportation of phosphate from Al Jalamid mines to the processing plant of Ma’aden Company located at Ras Al Khair Port started in May 2012. In April 2014, the first freight train transporting bauxite from Al Baitha mine to Ras Al-Khair started operations. “The 85km Jubail-Ras Al Khair and the 115km Jubail-Dammam sections of the mineral line are already under construction while the internal network of Jubail City is going to be awarded soon,” said Al Rumaih. SAR is finalising the award of the first stage of the internal network, which will connect the King Fahd Industrial Port and Jubail Commercial Port to
North South Railway (NSR) Transportation of phosphate from Al Jalamid mines to Ras Al Khair
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Jubail Industrial City 1 and 2. “The second phase will connect rest of the manufacturing facilities inside Jubail 1, which is a challenge because they will need to set up loading facilities,” said Al Rumaih. “The best case scenario is to work together as they build the plants so that they can plan ahead and integrate with the network.” Construction work on Saudi Landbridge Project, which aims to link Red Sea to the Arabian Gulf, is expected to start this year. It involves the construction of 950km of new track between Riyadh and Jeddah, another 115km track between Dammam and Jubail and the upgrading of the existing 450km link between Riyadh and King Abdul Aziz Port at Dammam. In January 2013, Public Investment Fund (PIF) awarded a $72m contract to US-based Fluor to provide management consultancy for the project. “The Jeddah-Riyadh line is in the design stage,” said Al Rumaih. “We are planning to tender the line for construction this year. Following the completion of the JeddahRiyadh link, travel times between the two cities will be six hours instead of the current 10 to 12 hours by bus. Passenger trains on the new line will be designed to travel at a speed of 250km/h, while freight trains will have a top speed of
NSR Track work near Al Jouf
IN FOCUS
140km/h to cover the distance between Dammam and Jeddah in around 12 hours. Once all the components of network become operational, the land journey from Red Sea to Arabian Gulf is expected to take only two days compared to the 7-10 days it takes now. The SAR chief underscored the importance of building a successful freight business even though both the Landbridge and the NSR involve passenger transport. “Good freight volumes hold the key to a successful rail system,” said Al Rumaih. “Railways will make a return on investment only if it transports high-value freight, like petrochemicals, across long distances.” To secure freight volumes, SAR has been entering into MoUs with major industrial stakeholders in the Kingdom. A MoU with Saudi Aramco signed last year seeks to utilise rail networks to transport petroleum products from the Jubail Bulk Plant to Al Jouf and Turaif Bulk Plants. A similar MoU was signed with SABIC in April this year to transport their products. “We will be signing a MoU with MODON to link their industrial cities to our rail networks through multimodal logistics terminals (MLTs),” said Al Rumaih. “We are taking steps to attract global and Saudi players to step into intermodal business.” SAR recently signed a MoU with the UAE’s Etihad Rail, the objective being to introduce common solutions, leverage best practice and allow for the free exchange of ideas and knowledge to improve the safety, efficiency, and economy of both countries’ railways networks.
On schedule Dr Rumaih Al Rumaih, CEO, Saudi Railway Company (SAR) in action at the GPCA supply chain conference
75%, while toxic fumes and nitrogen dioxide will be reduced by 50%. Giving an example of transporting phosphate via trains, he elaborated on the benefits of rail over road: “A single train, 3km long, can transport 15,000 tonnes of phosphate. Each wagon can carry 100 tonnes and it requires only 90 seconds to load 100 tonnes. On the other hand, each truck can carry only 25 tonnes; now imagine how long it will take to load 600
COST EFFECTIVE AND SUSTAINABLE
SAR is also keen to build a eco-friendly and cost competitive image for rail transport among the industrial and business community and the general population. “A well-connected railway network will result in capacity and fuel savings, as well as environmental benefits,” said Al Rumaih. “Rail is a sustainable transport mode, especially for minerals and petrochemicals, and is also the safest compared to roads.” He estimated that the shift in industrial traffic from roads to rail will reduce fuel consumption by 70%, while reducing road congestion by 75%. Moreover, CO2 emissions would be reduced by
IN NUMBERS
13%
GCC’s share of global primary petrochemicals production
0%
Share of rail in GCC’s chemical tonnage
50%
Share of trucks in the total chemical tonnage shipped in the US in 2012
trucks, not to forget the difficulties and the cost.” The mineral line on the NSR has so far transported 4.5 MT of phosphate With the GCC emerging as a global production hub for petrochemicals, the industry stands to gain a lot from the rail networks. According to a joint GPCA-AT Kearney study, in the US, the chemical industry and rail transportation go hand in hand. In 2010, 23% of chemical tonnage was transported via rail constituting around 10% of total rail tonnage and approximately 8% of carloads. “In the region in general, and Saudi Arabia in particular, rail’s share of chemical tonnage at present is close to zero,” said Al Rumaih. According to figures compiled by the American Chemistry Council (ACC), some 831 MT of chemicals were shipped in the US in 2012 at a cost of $43.9bn. In 2012, transportation costs were equivalent to 7.5% of the value of chemical industry shipments excluding pharmaceuticals. The cost of transporting chemicals by rail was only around 1.6% of the value of chemical industry shipments excluding pharmaceuticals. In 2012, chemicals accounted for 9.8% of tonnage, and 13.4% of gross revenue for US Class I railroads. At the same time, trucks accounted for more than 50% of chemical tonnage shipped and more than two-thirds of chemical transportation costs. The aforementioned figures clearly highlight the cost competitiveness of rail compared to trucks, making a strong case for the former in the region as well. In the US, plastic materials and synthetic resins — including polyethylene, polypropylene, polyvinyl chloride, and similar products — accounted for around 25% of rail chemical tonnage Given the importance of petrochemicals sector to the GCC economies - the region accounts for 13% of the world’s primary petrochemicals production – rail can clearly provide a safe, efficient, and costeffective transportation system that can help ensure that the industry continues to maintain its competitiveness. The ongoing rail programmes in individual countries, synchronised with the GCC Rail, are set to transform the region’s transportation sector for good. June 2014
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IN FOCUS
UTILITIES
Customised power GE is planning to tap decentralised power’s immense potential in the Middle East & North Africa (MENA) region with its distributed power business ith the region’s overall demand for electricity projected to grow at an average of 7% over the next 10 years, GE’s Distributed Power business has a clear agenda-address the increasing demand for on-site power from oil and gas majors and heavy industries in the MENA region. According to the company, the industrial sector accounts for a significant part of the power consumed in the region today, and increasingly, these industries are relying on on-site power systems to meet their needs and accelerate operational efficiency. Towards meeting the growing demand for on-site power systems that are efficient, reliable and sustainable, GE’s Distributed Power business is investing $1.4bn over four years globally and has three key product lines - aeroderivative Gas Turbines, Jenbacher Gas Engines and Waukesha Gas Engines. At an event organised by the company in Masdar City, Abu Dhabi, Lorraine Bolsinger, President & CEO of GE’s Distributed Power business, said: “Our business is all about creating local power using local fuels for faster, flexible, scalable and more secure power generation. GE’s aeroderivative gas turbines, Waukesha and Jenbacher gas engines can be installed in weeks and generate power in as little as five minutes. GE’s on-site power generation solutions will enable industries to take the pressure off the national grids, freeing more power for meeting peak load requirements. They also reduce energy losses from transmission and distribution thus delivering both economic and environmental benefits.” Distributed power is said to have become increasingly popular in countries that are seeking more reliable, efficient energy options near the point of use on or off the grid. GE’s own study forecasts that the growth of distributed
On-site power GE’s Waukesha 275GL+ gas engine (top) and Jenbacher gas engine (bottom)
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“Our business is all about creating local power using local fuels for faster, flexible, scalable and more secure power generation” LORRAINE BOLSINGER, PRESIDENT & CEO OF GE’S DISTRIBUTED POWER BUSINESS
IN FOCUS
IN NUMBERS
40%
Rate of growth of distributed power globally between now and 2020
20MW
The capacity of Lebanon’s first landfill gas-to-energy project powered by GE’s Jenbacher engines power will be 40% faster than global electricity demand between now and 2020. Additionally, more and more communities and businesses are installing distributed power technologies to improve access to electricity in remote areas with poor or non-existent electric grids. Bolsinger said that product lines from GE’s Distributed Power bring the dual advantage of assured and reliable power supply onsite as well as off-grid solutions and the ability to work with renewable energy solutions, a thrust area in several countries including the UAE, Saudi Arabia, Iraq, Lebanon, Egypt and Algeria, among others. According to GE, the oil and gas industry relies heavily on on-site power to provide electricity to remote operations as well as mechanical power to pump and compress gas. With the growing exploration of unconventional gas in Saudi Arabia, there are significant opportunities for GE’s Waukesha engines to help exploit the fuel source replacing equipment that relies on Heavy Fuel Oil (HFO) in use at drill rigs. “GE has been a trusted partner in the progress of the region, engaging with our customers to understand their requirements and providing solutions that support them,” said Bolsinger. Today, in line with the growth in the manufacturing sector and increasing demand for on-site power, delivering new power generation solutions is of critical importance to improve regional energy security.” GE’s Distributed Power solutions are already being deployed across several key industries and oil and gas majors in the MENA region. One of its most recent customers is the General Electricity Company of Libya (GECOL), which is using GE’s trailermounted, mobile aeroderivative gas turbines to meet peak summer demands. The fast-
Lorraine Bolsinger President & CEO of GE’s Distributed Power business
DUBAI’S GAS-TO-LANDFILL PROJECT The Al Qusais landfill is one of the largest sites for municipal waste collection in Dubai, receiving about 5,000 tonnes daily. With the decomposition of the municipal waste, landfill sites emit harmful gases, comprising about 55% methane and 45% CO2 into the atmosphere. These greenhouse gases contribute to environmental degradation and cause discomfort to people owing to the odour of the gases emitted. To address these issues, Dubai Municipality worked with Green Energy Solutions & Sustainability to set up Dubai’s first landfill gas-to-energy project. The landfill gas recovery system operates the flares by utilising GE’s Jenbacher gas engine (the first to be deployed for a landfill gas application in the GCC region) to generate 1 MW of power. This is now being used to operate the Hofstetter Umwelttechnik high efficiency gas conversion and flare equipment installed at the site. The gas collection system implemented by Green Energy Solutions & Sustainability collects landfill gas through an intricately laid network of horizontal and vertical pipes. The collected gas is flared with a small portion utilised for power in the initial phase. The Hofstetter high efficiency flare safely disposes the flammable constituents of landfill gas, particularly methane.
track, $135m project includes four of GE’s TM2500+ units, which will provide more than 100 MW of power in the expansion of Zawia and W. Tripoli power plants. Offering a power range from 16MW to 100MW, GE’s aeroderivative turbines are also used at Abu Dhabi Gas Industries (GASCO) and Zakum Development Company (ZADCO) in the UAE; at Sonelgaz in Algeria; and Tahrir Petrochemical Industries Company in Egypt. Among others, major contracts for these turbines include contracts with the Iraqi Ministry of Electricity and Kuwait Oil Company. Derived from aircraft engines, the aeroderivative turbines run on a variety of fuels and emissions technologies including liquids and gas. GE’s Jenbacher gas engines, which offer the flexibility to run on a number of fuels including natural gas or other gases, are currently employed in landfill-to-energy projects in the UAE, Saudi Arabia and Lebanon. The Jenbacher project in the UAE is for Dubai Municipality at the Al Qusais landfill site, which generates 1 MW (1,000 kW) of power used to operate the high-efficiency gas conversion and flare equipment installed at the site. In Saudi Arabia, six Jenbacher gas engines are used to generate energy to operate a paper mill in Al Obaikan. In Lebanon, the company is providing the energy-efficient Jenbacher engines for the country’s first landfill gas-to-energy project in Naameh, set to generate 20 MW of power annually. Jenbacher engines have been installed in the Bekaa Valley area (Baalbek) and the South (Saida and Tyre) region. GE’s Waukesha gas engines, currently deployed at Kuwait Oil Company (KOC), can power a power range of 100 kW to 3.6 MW. They offer critical oilfield power generation, gas compression and mechanical drive applications and are known for durability, reliability and performance, even in harsh environments.
“GE’s on-site power generation solutions will enable industries to take the pressure off the national grids” LORRAINE BOLSINGER, PRESIDENT & CEO OF GE’S DISTRIBUTED POWER BUSINESS June 2014
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ANALYSIS
INDUSTRY
Rebound effect Global economic revival is boosting Middle East growth prospects across multiple sectors, says IHS
indings from a multisector study carried out by IHS reveals that the Middle East presents investors with significant growth opportunities across defence, chemical, automotive, energy and maritime sectors throughout the next decade. “Economies considered to be ‘dull and old’ - like those of the US, Germany, UK and Japan - will drive the global recovery in 2014. The return to global growth will have a very positive impact on the Middle East, especially the Gulf countries,” said Nariman Behravesh, chief economist at IHS. “We are seeing positive economic growth signs in the Middle East, primarily driven by the Gulf countries,” he said. “Regional consumer spending is on the rise, the regional unemployment rate will be below that of France, Germany and Italy for the next three years and compound annual growth rates are forecast to be above-average through 2035.”
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“Economic prosperity has been one of
INFRASTRUCTURE MIDDLE EAST
“We are witnessing the beginning of the ‘second generation’ of the Middle East chemical industry” DAVE WITTE, GM OF IHS CHEMICAL & SENIOR VICE PRESIDENT, IHS
DEFENCE DEALS
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the reasons behind the rapid acceleration of defence spending in the Middle East since 2011,” said Craig Caffrey, senior defence budget analyst at IHS Jane’s Aerospace, Defence & Security. “Four of the top five fastest growing defence markets in 2013 were Middle Eastern countries. As we look at spending in the next decade, there are no signs that the sector is slowing down. Between 2014 and 2020, IHS estimates total defence spending in the Middle East and North Africa will be $920bn.” Guy Anderson, senior principal analyst at IHS Jane’s Aerospace, Defence and Security, examined the impact of defence deals on the Gulf economy. “By 2020, $27bn will be injected into the
June 2014
Gulf economy from defence deals via offset programmes,” he said. “Defence offsets are a form of direct or indirect economic compensation to balance defence equipment purchases, and they are increasingly becoming the deciding factor in larger military acquisition programmes.” Saudi Arabia is assessed by IHS Jane’s to gain the most globally from its offset programme. “By 2020, $12.6bn will be added to the Saudi economy from defence offset deals, the highest globally,” he said. “In second place will be the UAE, with $12.2bn added during the same time period. India will take the number three spot, with $10.4bn added to its economy. “The Gulf has placed a strong emphasis on the long-term economic value of defence offsets,” said Anderson. “An IHS review of Gulf offset programmes found that the region is emphasising the development of its non-oil sector economy, specifically advanced training and investment. Economic diversification is seen as one avenue to achieve long-term economic goals, defence industrialisation is viewed as a route to economic change and an opportunity to create jobs for nationals.”
ANALYSIS
START OF A ’SECOND GENERATION’
IHS Chemical says investments will drive chemical exports from the Middle East and will help the chemical industry grow faster than other key industries in the region. China will be the biggest market for these Middle East exports, which will grow by more than eight per cent year-on-year in 2016, representing an increase of more than six per cent growth above 2013 chemical export figures. “We are witnessing the beginning of the ‘second generation’ of the Middle East chemical industry,” said Dave Witte, general manager of IHS Chemical and senior vice president at IHS. “The Middle East continues to be a dominant force in petrochemical production. The region faces an opportunity to pivot to strategies that leverage their growing technological expertise, expand their global footprint and seize upon commercial advantages. Additionally, this new era enables Middle East producers to continue building on their leading position in commodity production and expand into intermediates and higher-value products.” Added Witte: “For the Middle East refining and petrochemical industry, a changing global feedstock mix - combined with increasing competition in the US driven by the availability of cheaper gas feedstock - are reinforcing previous decisions by Middle East petrochemical producers to continue investing in new technology. The industry is also diversifying its feedback mix and expanding its product slates to include more higher-value intermediates.” PRIVATE POWER DEVELOPMENT
To meet the region’s high growth in power demand, IHS forecasts a need for $350bn in new investment for generation between now and 2030, said Andy Barrett, senior global gas and power advisor at IHS. “This is forecast mainly to build new gas-fired capacity but expected tightness in domestic gas availability in many countries is driving diversification to other fuels and technologies, including clean coal, nuclear and renewables,” he said. Recently-announced aggressive renewables targets for several countries are unlikely to prove achievable, Barrett noted, but “IHS predicts that around $50bn of the new
investment will be required to develop around 17GW of (mainly solar) renewable generation. In terms of opportunities for private power development (IPPs). the region should prove to be the most attractive in the world.” AMBITIOUS REFINING PROJECTS
According to Farrah Boularas, senior researcher at IHS Energy, announced refining and related facilities in the GCC are IN NUMBERS
$12.2bn
Value of defense offset deals to the UAE by 2020
$350bn
New investment for power generation between now and 2030
OPPORTUNITY SNAP SHOT • Defence sector: Between 2014 and 2020, total defence spending in the Middle East and North Africa is estimated to be $920bn; by 2020, $27bn will have been injected into the Gulf economy from defence deals via offsets; • Chemical sector: Investments will drive the ‘second generation’ of the Middle East chemical sector; regional chemical exports will help the industry grow faster than other key industries, with more than eight per cent year-on-year growth in 2016; • Automotive sector: IHS forecasts that the Middle East automotive sector will grow twice as fast as those of Western Europe and the US between 2012 and 2020, with a likely 30% rise in regional light vehicle sales; • Energy sector: IHS estimates show that $350bn in investments are needed to meet regional power demand; the GCC will require an $80bn investment to add 1.5m bpd of crude-topping capacity; • Maritime sector: Multibillion dollar investments in cargo infrastructure will position the UAE as the port for Africa, the subcontinent and the Middle East.
estimated to exceed $80bn of cumulative investment through 2020. While not all plans will reach the execution stage, a number have already broken ground. Between 2014 and 2020, IHS expects crude distillation and condensate-splitting capacity additions will increase regional output by around 1.5m bpd. In addition, desulphurisation capacity will also increase substantially as countries such as Saudi Arabia and Kuwait invest heavily in clean fuel projects, enabling production of motor fuels aligned with Euro V specifications. Boularas said: “GCC refiners that are able to complete their projects will therefore, intensify competition in supplying Europe and Africa, potentially to the detriment of refiners in Europe, the former Soviet Union, India and Asia.” TWICE AS FAST
“The Middle East automotive market is forecast to grow twice as fast as those of Western European and North American markets from 2012 to 2022,” said Pierluigi Bellini, analyst at IHS Automotive. “In 2022, IHS Automotive forecasts that light vehicle sales in the GCC will jump 25% to 1.74m, and sales in the Middle East will jump 30% to 3.45m.” GLOBAL CARGO LEADER
Initial estimates suggest that Dubai will make an $8bn cargo infrastructure investment along with $10bn in private sector contributions to help position the GCC as a global cargo leader, said Richard Clayton, chief maritime analyst at IHS. “All eyes will be on Dubai in 2020 as it hosts the World Expo event,” said Clayton. “New roads, a peninsula-wide rail project, another airport, hotels, energy plants and event venues will generate project cargo on a grand scale.” IHS forecasts that by the end of 2014, Jebel Ali port will have an annual container capacity of 19m TEU with output pushing towards 20m by 2020. In partnership with the new Dubai airport, Jebel Ali will generate as much as 12m tonnes of sea-air cargo, five times more than the current level. “We are seeing multi-billion dollar investments in the UAE’s cargo infrastructure as the country positions itself as the port for Africa, the subcontinent and the Middle East,” said Clayton. June 2014
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MIDDLE EAST INFRASTRUCTURE TENDERS
Infrastructure Tenders Our monthly analysis of new tenders and key projects across the region
RABIGH CEMENT PLANT EXPANSION PROJECT
RIYADH BUS NETWORK PROJECT
RATQA FIELD HEAVY OIL PRODUCTION FACILITIES
MUSCAT-SOHAR PRODUCT PIPELINE PROJECT
BUDGET: $7,000,000,000
BUDGET: $5,000,000,000
BUDGET: $4,300,000,000
BUDGET: 200,000,000
Territory: Saudi Arabia Client Name: Arabian Cement Company (ACC) Description: Engineering, Procurement and Construction (EPC) contract for the expansion of an existing cement plant Period: 2017 Status: New Tender
Territory: Saudi Arabia Client Name: Arriyadh Development Description: The project involves operation and maintenance of a new 83km-long bus rapid transit system in Riyadh Period: 2018 Status: New Tender
Territory: Kuwait Client Name: Kuwait Oil Company Description: Engineering, Procurement and Construction (EPC) contract to build new heavy oil production facilities Period: 2017 Status: New Tender
Territory: Oman Client Name: Oman Refineries & Petroleum Industries Company Description: EPC contract to build 280-km product pipeline to connect refineries in Sohar and Muscat Period: 2018 Status: New Tender
June 2014
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MIDDLE EAST INFRASTRUCTURE TENDERS
Top Tenders UAE ETIHAD RAIL NETWORK PHASE 2 - PACKAGE E Project Number: WPR301-U Client Name: Etihad Rail Company, Abu Dhabi Address: Makeen Tower, Abu Dhabi Phone: (+971-2) 499 9999 Fax: (+971-2) 499 9998 Email: contacts@etihadrail.ae Website: www.etihadrail.ae Description: Construction of depots, passenger stations, freight facilities and marshalling yards; Construction of 38 km railway line with double track from Mussafah to ICAD Corridor Branch; Parsons International has been appointed as the project manager for the scheme. Seven companies have bid for the main construction contract. An award is anticipated in the third quarter of 2014. Period: 2017 Status: New Tender Tender Categories: Construction & Contracting
International has been appointed as the project manager for the scheme. Ten bidders have submitted their bids with award expected in the third quarter of 2014. Period: 2017 Status: New Tender Tender Categories: Construction & Contracting, Public transportation
ETIHAD RAIL NETWORK PHASE 2 - PACKAGE B Project Number: WPR298-U Client Name: Etihad Rail Company, Abu Dhabi Address: Makeen Tower, Abu Dhabi Phone: (+971-2) 499 9999 Fax: (+971-2) 499 9998 Email: contacts@etihadrail.ae Website: www.etihadrail.ae Description: Construction of a 190-km railway line with double track from Liwa Junction to Al Ain. Parsons International has been appointed as the project manager for the scheme. Nine bids have been received for the main construction contract. An award is anticipated
ETIHAD RAIL NETWORK PHASE 2 - PACKAGE F Project Number: WPR301-U Client Name: Etihad Rail Company, Abu Dhabi Address: Makeen Tower, Abu Dhabi Phone: (+971-2) 499 9999 Fax: (+971-2) 499 9998 Email: contacts@etihadrail.ae Website: www.etihadrail.ae Description: Construction of 38km railway line with double track from Mussafah to ICAD Corridor Branch. The project also includes 40-km of tracks in Mussafah Control Centre, Marshalling Yard and Maintenance Depot and the ICAD Bulk and Container Terminal. Parsons
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in the third quarter of 2014. Period: 2017 Status: New Tender Tender Categories: Construction & Contracting, Public transportation
ETIHAD RAIL NETWORK PHASE 2 - PACKAGE D Project Number: WPR300-U Client Name: Etihad Rail Company, Abu Dhabi Phone: (+971-2) 499 9999 Fax: (+971-2) 499 9998 Email: contacts@etihadrail.ae Website: www.etihadrail.ae Description: Integration, testing and commissioning management that includes integration with civil works, tracks, rolling stock facilities, signaling and train control, centralised train control, comprehensive communications system including radio, fiber optic backbone, CCTV, public address, telephone, supervisory control and data acquisition (SCADA), asset protection, depot control and power supply system. Five bids have been received. Period: 2017 Status: New Tender Tender Categories: Construction & Contracting, Public transportation
Oman COIL COATING PLANT PROJECT Project Number: WPR246-O Client Name: Oman Aluminium Rolling Company Address: Al Fardan Building, Meydan Al Azaiba, Muscat PC 133 Phone: (+968) 2462 1900 Fax: (+968) 2452 3050 Email: info@oman-arc.com Website: www.oman-arc.com Description: Engineering, Procurement and Construction (EPC) contract to build a state-of-the-art Coil Coating Plant with production capacity of 25,000 tonnes per annum Budget: $32,000,000 Period: 2015 Status: Current Project Main Contractor: Leighton Middle East Oman Tender Categories: Industrial & Special Projects
SARAYA BANDAR JISSAH COMPLEX Project Number: WPR270-O Client Name: Saraya Bandar Jissah Address: Madinat Al Sultan Qaboos
MIDDLE EAST INFRASTRUCTURE TENDERS
Bahrain Phone: (+968) 2464 0000 Fax: (+968) 2469 8988 Email: info@ sarayabandarjissah.com Website: www. sarayabandarjissah.com Description: Construction of a fivestar hotel comprising 206 rooms Budget: $78,000,000 Period: 2017 Status: Current Project Main Consultant: Atkins International (UK) Main Contractor: Leighton Middle East Tender Categories: Hotels
Kuwait HIGH-VOLTAGE POWER & FIBRE OPTIC PLANT PROJECT Project Number: MPP2741-K Client Name: Aslaa General Trading & Contracting Company (Kuwait) Address: Shayma Tower, 2nd Floor, Omar Bin Al Khattab Street, Murgab Phone: (+965) 2225 2290 Fax: (+965) 2225 2293 Email: info@aslaa.com Website: www.aslaa.com Description: Engineering, procurement and construction (EPC) contract to build high voltage power and fibre-optic plant. Status: New Tender
Tender Categories: Water Works
BAHRAIN - SAUDI OIL PIPELINE PROJECT
DISABLED SPORTS FACILITY PROJECT
Project Number: WPR104-B Territory: Bahrain Client Name: Bahrain Petroleum Company (BAPCO) Phone: (+973) 1775 2995 Fax: (+973) 1770 4070 Website: www.bapco.net Description: Replacement, upgrading and changing the path of more than 115 km of pipeline that links Saudi Arabian oil fields to the only refinery in Bahrain Status: New Tender FEED Consultant: WorleyParsons (Bahrain) Tender Products: Crude
Project Number: PP2899-K Client Name: Public Authority for Youth & Sports (Kuwait) Phone: (+965) 242 1718 Fax: (+965) 241 0867 Email: contactus@km.com.qa Description: Construction of a sports facility for the disabled comprising a number of different facilities, including a running track, gymnasiums and an ice rink Status: New Tender Tender Categories: Construction & Contracting, Leisure & Entertainment
Transportation, Storage & Distribution, Pipes, Tubes & Fittings
Iraq DESALINATION PLANT PROJECT - BASRA CITY Project Number: MPR1449-IQ Client Name: Ministry of Municipalities & Public Works Email: info@mmpw.gov.iq Website: www.mmpw.gov.iq Description: Construction of a desalination plant with capacity of 200,000 m3/day Status: Current Project Tender Categories: Water Works Tender Products: Water Desalination Plants
PRODUCED IN ASSOCIATION WITH BIG PROJECT MIDDLE EAST AND MIDDLE EAST TENDERS M MIDDLE EAST
Email: info@egpc.com.eg Website: www.egpc.com.eg Description: Build, Own, Operate (BOO) contract for the exploration of a 2,058 sq km onshore block including eight wells Period: 2016 Status: New Tender Hotel Consultant: Faisal Al-Ansari Contracting (Saudi Arabia) Tender Categories: Gas Processing & Distribution, Oilfields & Refineries
Egypt SOUTH WEST MELEIHA ONSHORE BLOCK EXPLORATION PROJECT - BLOCK 14 Project Number: ZPR1272-E Client Name: Egyptian General Petroleum Corporation (EGPC) Address: EGPC Bldg., Palestine Street, 4th Sector, New Maadi Area, Cairo 11472 Phone: (+20-2) 2703 1438 Fax: (+20-2) 2703 1457
June 2014
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TEN BAHRAIN INFRASTRUCTURE PROJECTS
BAHRAIN PROJECTS Though the smallest country in the GCC group, Bahrain is emerging as a significant player in the region’s infrastructure boom. Infrastructure ME showcases Bahrain’s mega projects line-up
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INFRASTRUCTURE MIDDLE EAST
June 2014
BAHRAIN-SAUDI ARABIA RAILWAY LINE
Owner: Bahrain govt Budget: $4.5bn Progress: Feasibility study The rail link, which will be part of the ambitious 2,177km GCC rail link, will be rendered through a second causeway parallel to the existing King Fahd Causeway between Bahrain and Saudi Arabia. King Fahd Causeway Authority (KFCA), which is overseeing the 25-km causeway, has appointed a consultant for the rail project study. Arabic daily Al Youm quoted Kamal bin Ahmed, Minister of Transportation and the Acting Chief Executive for the Economic Development Board, Bahrain as saying that requires more ‘technical and environmental’ study. In February this year, a Bloomberg report quoted the minister as saying the deadline and funding for the project is expected to be finalised by September 2014. The Minister also said that reaching the target of completion by 2018 (which is the target set for GCC Rail) cannot be assured.
TEN BAHRAIN INFRASTRUCTURE PROJECTS
EAST SITRA RESIDENTIAL PROJECT
SITRA REFINERY EXPANSION
Owner: Ministry of Housing Owner: BAPCO Budget: Approx. $5bn Budget: $6bn Progress: Contracts awarded Progress: FEED and Project Management consultancy evaluation East Sitra Town scheme will feature up to 5,000 housing units, in addition to service facilities and industrial zones. In April this year, UAE-based National Marine Dredging Company (NMDC) was awarded a contract, to undertake the preliminary reclamation work in the land over a 30-month period. The East Sitra scheme is the first housing project to be funded by the GCC Development Programme (GCC Marshall Plan), and is an important part of the government’s plan to construct more than 40,000 houses over the next eight years across five governorates. Last month, Phase 1 of East Hidd City housing project, which is being financed by the Kuwaiti government, was awarded to a Kuwaiti-Bahraini consortium. The 483 units of Phase 1 are expected to be completed over the next 18 months. The East of Hidd project will eventually comprise 4,526 residential units.
The Bahrain Petroleum Company (BAPCO) is planning to increase the capacity of the Kingdom’s Sitra refinery by approximately 270,000bpd to 360,000bpd. This will bring the country’s total crude refining capacity to 360,000bpd by 2018. In January 2013, BAPCO appointed the UK’s HSBC and France’s BNP Paribas as financial advisers. The refinery expansion project includes a crude unit and associated facilities, hydrocracker and associated facilities, residue conversion units and a waste treatment facility. BAPCO is currently evaluating the offers for FEED and project management consultancy contracts for the expansion. The FEED study for a 350,000 bpd Saudi-Bahrain crude oil pipeline, crucial to the Sitra expansion, has been completed.
AL DUR POWER PLANT PROJECT - PHASE 2
Owner: Electricity and Water Authority (EWA) Budget: $1.5bn Progress: Under planning Al Dur Power Project Phase 2 will be a combined cycle power plant with a capacity of 1,300MW-1,500 MW. EWA is evaluating whether Phase 2 should be built on EPC basis or as Public-Private-Partnership (PPP) basis. Also, no decision has been taken on the desalination component. According to MEED, the plant is planned to be commissioned between 2017 and 2019. Phase 1, which was officially inaugurated in 2012 and cost $2.1bn, was set up as a PPP, and is currently, the largest independent power and water desalination plant in the Kingdom, producing 1,234 MW of power and 48 MIGD of water. Bahrain’s annual electricity consumption stands at 3,000 MW (with a production capacity of 4,000 MW) and is growing at the rate of 7-10% per annum. June 2014
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TEN BAHRAIN INFRASTRUCTURE PROJECTS
SAUDI-BAHRAIN CRUDE OIL PIPELINE
Owner: BAPCO Budget: $350m Progress: FEED completed The new 350,000bpd crude oil pipeline between Saudi Arabia and Bahrain will replace the existing 230,000bpd line and help BAPCO expand its Sitra refinery. Crude oil will flow from Saudi Aramco’s Abqaiq plant via the 115km pipeline, 74km of which will run overland and the rest under the Gulf. Aramco’s Abqaiq plant is the company’s largest oil processing facility and the largest crude oil stabilisation plant in the world. While Australia’s WorleyParsons executed the FEED work, the EPC tender is expected to be announced by the end of this year. Finally, the pipeline is expected to be commissioned by the third quarter of 2016. Saudi Arabia and Bahrain share the output of 300,000 bpd offshore Abu Saafa field. Proceeds generated by the Abu Saafa field contribute more than half of total oil revenues for Bahrain.
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BAHRAIN INTERNATIONAL AIRPORT EXPANSION
Owner: Bahrain Airport Company Budget: $1bn Progress: Phase 1 awarded Bahrain International Airport is the home base of Gulf Air and receives nine million passengers a year. After the initial expansion phase, the airport will be able to receive 13m passengers. In February, France’s ADPI was awarded the contract to design and supervise Phase 1 of the expansion. As per the deal, ADPI will conduct all studies on the development of the airport over the next 20 years, and design and supervise construction of a new passenger terminal of more than 150,000 sqm, based on the initial findings of the master plan studies. Construction of the new terminal is expected to be completed in late 2018. In January, Hill International was awarded a contract worth $18.3m for providing project management consultancy services for the modernisation programme.
TUBLI STP EXPANSION PROJECT - PHASE 4
Owner: Ministry of Works Budget: $250m Progress: Completion of EPC prequalification Phase 4 aims to absorb the growing wastewater flow arriving to Tubli Treatment Plant, through the expansion of the existing Plant from 200,000 m3/day to 400,000 m3/day. The project comprises civil works to construct the new inlet of the STP; preliminary, secondary and tertiary treatment structures for the expansion of STP, in addition to the sludge treatment units, a treated water storage tank and office buildings. Twenty five prequalification applications were received by the Ministry, which is planning to issue EPC bid documents to the shortlisted companies by 2014 end. The project is scheduled for completion by 2018. Phase 4 is being funded by Kuwait Fund for Arab Economic Development (KFAED), the Saudi Fund for Development and the Bahrain Government.
TEN BAHRAIN INFRASTRUCTURE PROJECTS
DILMUNIA HEALTH ISLAND
Owner: Ithmaar Development Company Budget: $1.6bn Progress: Phase 1 awarded Dilmunia at Bahrain is a mixed-use project built on a man-made island off the coast of Muharraq with a focus on healthcare and well-being. Conceived with the objective of developing Bahrain into a health tourism destination, Dilmunia comprises residential, commercial, hospitality and wellness/ healthcare facilities. In March, Ithmaar awarded the infrastructure package, valued at $22.5m, to Cebarco Bahrain. The package consists of highways, roads, a distributor bridge crossing on top of Dilmunia’s Grand Canal, landscaping, and power, water, sewerage, drainage, and telecommunications networks. The contractor will be working closely with infrastructure designers Mott MacDonald and cost consultants DG Jones & Partners to deliver the infrastructure over a 24-month period.
LNG IMPORT TERMINAL
BAHRAIN DRAGON CITY
Owner: National Oil and Gas Authority (NOGA) Budget: Upto $1bn Progress: EoI stage
Owner: Diyar Al Muharraq Budget: Not disclosed Progress: Phase 1 awarded
The three stakeholders in this project are National Oil and Gas Authority (NOGA), Oil and Gas Holding Company (nogaholding) and BAPCO. The imported LNG is expected to supplement domestic production and ensure that gas demand can be met, especially from the power and desalination sectors. Nogaholding, which is the investment and development arm of Noga, engaged Galway Group of the US as the project consultant, which sub-contracted the Pre-FEED study to Worley Parsons. The initial capacity of the regasification terminal is expected to be 400 cfd. In February 2014, 14 potential developers were asked to submit expressions of interest. The closing date was set for February 22, 2014. Though, end-2016 has been set as the project deadline, the request for proposals is yet to be sent out.
Set in the southwest corner of Diyar Al Muharraq, spread over 115,000 sqm, Dragon City is a part of the $3.2bn mixed-use Diyar Al Muharraq development. It will occupy a gross floor area of 51,000 sqm with 700 individual retail store spaces, warehousing of 5,000 sqm, a dining street of 6,000 sqm and car park for 1,500 vehicles. Bahrain’s Nass Contracting was awarded the contract for phase one, which will open in June 2015. Phase two is expected to double the size of the existing project to 335,000 sqm or the equivalent of 47 international football pitches. The wholesale and discount-oriented mall is targeting between 1-2m visitors a year and will be operated by Chinamex Middle East, one of China’s largest overseas trading companies. Dragon City’s catchment area will extend to Bahrain, the eastern province of Saudi Arabia and rest of the GCC. June 2014
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COVER STORY
PETROCHEMICALS
Profitable growth Mohammad Husain, President & CEO of EQUATE speaks to Anoop K Menon on how Kuwait’s and the GCC’s first international JV in the petrochemicals sector continues to set industry benchmarks
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COVER STORY
he year 2013 has proved to be an exceptional one for Kuwait’s EQUATE Petrochemicals, with overall sales value exceeding $2.88bn for the first time in the company’s history. The company reported a net profit of $1.25bn, up 14% over the $1.09bn of 2012. Established in 1995 and commencing production in 1997, EQUATE is an international joint venture between Petrochemical Industries Company (PIC), The Dow Chemical Company (Dow), Boubyan Petrochemical Company (BPC) and Qurain Petrochemical Industries Company (QPIC). The company is the single operator of a fully integrated manufacturing facility producing more than five million tonnes annually of petrochemical products marketed throughout the Middle East, Asia, Africa and Europe. While announcing the results in March this year, EQUATE President & CEO Mohammad Husain attributed the performance to “absolute integration between commercial, industrial, administrative and other elements at the company,” as well as buoyant global demand for petrochemical products despite several local and regional challenges. Infrastructure Middle East caught up him on the side lines of the sixth Gulf Petrochemicals and Chemicals Association (GPCA) Supply Chain conference in Dubai last month to understand EQUATE’s and the regional petrochemical industry’s challenges and priorities. Husain, who in his capacity as Chairman of the GPCA’s Supply Chain committee had delivered the opening address on the topic earlier, was quick to underline the role of supply chains in driving the petrochemicals industry’s growth. “Supply chains consume a lot of efforts and time,” he explained. “If we don’t optimise them or create maximum value out of them, we will have lesser margins than what we expect.” He pointed out that the expansion and introduction of new land and sea transport infrastructure will enhance the petrochemicals industry’s flexibility — a necessary trait for this export-oriented sector. According to GPCA estimates, in 2013, the region’s petrochemicals industry exported
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“The industry needs advanced national and regional infrastructure if we are to succeed”
government entities, border and customs regulators, logistics service providers and educational institutions. “The supply chain is made up of many links, and we will only be as strong as the links that make up the entire chain,” he observed.
MOHAMMAD HUSAIN, PRESIDENT & CEO, EQUATE
SPOTTING OPPORTUNITIES
63.4mt of chemicals, valued at $55.5bn. The sector currently produces more than 90 products, with the portfolio expected to expand to 160 products by 2020. “The integration of the supply chains throughout the GCC will make a huge difference to us at EQUATE,” he continued. “Being based in the North of the Gulf, shipping to the south and having deeper water – having that flexibility is very critical to us from a value-creation standpoint. Our industry needs advanced national and regional infrastructure if we are to succeed.” Husain recommended that the only way to overcome logistics bottlenecks in the petrochemical industry is to strengthen partnerships between GCC
EXECUTIVE BIO With over 30 years of extensive professional service, Mohammad Husain has held various leading posts, both administrative and technical, at Kuwait Oil Company (KOC), Petrochemical Industries Company (PIC) and finally at Kuwait National Petroleum Company (KNPC) as Deputy Chairman & Deputy Managing Director for Mina Al Ahmadi Refinery. In addition, he served on EQUATE Board of Directors from 2004-2012. Having held several leadership positions and board memberships, Husain’s overall competencies and areas of expertise include exploration, development and production of oil and gas, petrochemical and downstream activities, as well as corporate planning and strategy development. Mohammad Husain holds a Bachelor’s degree in Petroleum Engineering from the University of Tulsa and is a Board member of the Gulf Petrochemicals & Chemicals Association (GPCA) since 2012.
A tighter supply chain integration assumes significance in the context of the economic slowdown in China, which is a key market for petrochemical exports from the Middle East. According to a report by the Organisation for Economic Cooperation and Development (OECD), a Paris-based think tank, China’s GDP growth rate is expected to be just below 7.5% in 2014 and 2015. Global economic growth during these years, it adds, will be largely led by the advanced economies in Europe and North America. But Husain is unfazed by the spectre of a slowdown in China. He believes that it is representative of the dynamics the region’s petrochemical industry must contend with if it is to capture opportunities wherever they exist or whenever they arise. “Twenty years ago, China wasn’t really in the picture,” he noted. “If we see a trend, we have to understand the signals to cope with the future. We have to be more creative and innovative to ensure that we are ahead of the game” Husain pointed out that for an economy that grew at 12-15% annually, a 7.5% GDP growth would be a slowdown in relative terms. But GDP growth in the developed economies is expected to be in the 2-4% range, which is still below that of China. “We must also take into consideration India and other East Asian countries,” he said. “Even 1% of the middle class in these regions constitute a huge market.” On the question of shale gas being a bane or boon for the region, Husain proffered the opportunity argument. “The way I see it, we should be looking how to tap into shale gas and generate value. Instead of it coming to us, perhaps we could go to it,” he stated. But he doesn’t see low oil prices, something that is being talked about in the context of the slowing growth in Asian markets, offering any particular feedstock advantages to the region’s petrochemicals industry. “Our thinking is not limited to the small picture,” he said. June 2014
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COVER STORY
Ahead of the game EQUATE is taking a phased approach to creating value from current facilities
“To support their payrolls and social requirements, countries in the region would require more than $70 a barrel. We have to look at the total benefit not just individuals. At the end of the day, you might get some value out of lesser price but the reality is we are not going to be able to create more value where the countries are concerned.” Meanwhile, EQUATE is hoping to derive value from capacity addition. “There is nothing firmed up yet but there is a lot of ambition,” said the EQUATE chief. “Growth is not an option we should be thinking about; rather, it is a must because if we don’t grow, we will either become marginalised or die.” CREATING VALUE
Under its 2020 strategy, which was announced in 2012, EQUATE is taking a phased approach to creating value from current facilities and building a greater global presence. The focus has also been on increasing and optimising production capacities for ethylene, polyethylene (PE) and ethylene glycol (EG). Last year, the company launched its PE plant debottlenecking project to increase existing capacity, which currently stands at 825,000 metric tonnes annually (MTA). “The debottlenecking will yield value next year,” said Husain.
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“Instead of it (shale gas) coming to us, perhaps we could go to it” MOHAMMAD HUSAIN, PRESIDENT & CEO, EQUATE
During the media session at the eight Annual GPCA Forum last year, the EQUATE chief had pointed out that he was expecting demand for PE and EG to peak over the next three years (20142017) due to upcoming capacities for PE in Saudi Arabia and EG in Qatar. That observation continues to be relevant. “We think the market will continue to remain strong up to 2017; but from 2017 to 2019, there could be some tightness depending how much products are in the market. But from 2020 onwards, we will be firmly on the growth path,” he said. EQUATE has also been implementing sustainability initiatives that could add value to the company in the long run. In 2008, the company launched phase 1 of Kuwait’s first ever carbon emission reduction and capture project with local partner Greencarbon. Under this deal, EQUATE’s carbon dioxide emissions ( CO2 ) will be captured and
marketed to customers requiring the gas for various uses. EQUATE expects to export nearly 150,000 tonnes of CO2 annually to Greencarbon. In April 2013, the company signed a contract with Gulf Cryo to set up phase two of the CO2 capture project. “We plan to commission phase 1 this year with phase 2 following soon,” said Husain. Once both phases start functioning, EQUATE will be on track to becoming a zero CO2 emissions company. In acknowledgement of the fact that the region suffers from water scarcity, the company has also implemented initiatives like Kuwait’s first seawater cooling towers that cool and reuse hot seawater from process plants, a wastewater recovery plant which converts wastewater into distilled water and a plant water recycle project capable of recycling and reusing 80% of the process wastewater. But it’s not just water that is on EQUATE’s conservation radar. “We are optimising our operations in order to reduce our energy consumption,” said Husain. “We are also looking at catalysts with our partner Dow to reduce the CO2 emissions from the source.” The EQUATE chief is clear that in his company, sustainability is not so much about profitability than about responsibility to the society and environment. But he doesn’t discount sustainability’s competitive advantages in the long run. As he observes in the introductory CEO Letter in EQUATE’s 2012 Sustainability Report: “Sustainability reporting is encouraging us to continue consolidating management principles that are translating into competitive advantages for the company as well as making worthwhile achievements for the service of society.”
EQUATE’s PRODUCTS • • • • • • • •
Polypropylene 140,000 MTA Polyethylene 825,000 MTA Ethylene Glycol 1.2 M MTA Paraxylene 829,000 MTA Styrene Monomer 450,000 MTA Benzene 393,000 MTA Ethylene 1.8 M MTA Heavy Aromatics 80,000 MTA
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TECHNOLOGY
3D MODELLING
Courtesy Network Rail
Engineering intelligence Point clouds and scalable terrain models support Network Rail’s Great Western Rail Electrification Programme he Great Western Electrification Programme represents an investment of $2.52bn that will allow faster, quieter travel, with increased seating capacity, and improved reliability on one of the United Kingdom’s oldest and busiest railways. This programme will enhance the railway line between London and Oxford, Newbury, Bristol and Cardiff. With a project of such scope, owneroperator Network Rail needed a way to incorporate enormous amounts of survey data with design models from multiple consultants, in order to aid efficient project collaboration and streamline interactions between designers and contractors. In
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addition, to encourage efficient data collaboration along with increased productivity, Network Rail followed the BS 1192 code of practice for the collaborative production of architectural, engineering as well as construction information. Network Rail used Bentley Descartes to merge point clouds, scalable digital terrain models, and raster files with the consultants’ design models to create a scalable 3D information model. Using Bentley Descartes provided Network Rail with a complete view of the entire project, enabled efficient design review and effective team collaboration, and allowed the organisation to meet Building Information Modelling (BIM) criteria included in BS 1192. When construction is complete, Network Rail will then be able to use
the 3D information model to support its asset management programme. A GREAT COMBINATION
Among this project’s many requirements is the need to assess, retrofit, or construct significant amounts of infrastructure, including 1,000km of single-track, 12,000 steel piles and 4,000 reinforced concrete foundations, and 164 structures that require gauge clearance analysis – including bridge interventions, lowering of track, canopy cuts, and more. Managing such a project requires efficient collaboration between Network Rail and the organisation’s many business partners and subcontractors. Using Bentley Descartes, Network Rail has established a scalable 3D information model as the geo-coordination platform to aggregate
TECHNOLOGY
draped with thousands of orthoimages, point clouds acquired by helicopter, and designs provided in the DGN format and i-models – which Bentley Descartes supports natively – the scalable 3D information model provides a unique environment to enable collaborative review, condition assessment, and construction simulation together with 4D animations. But the value of the 3D information model goes beyond the design and construction phases, to support Network Rail’s longer-term asset management programme by providing a live 3D map that indexes and references asset documentation. As a long-time user of Bentley software, Network Rail uses ProjectWise as its engineering information management platform to enable team collaboration and data exchange in a secure environment among all partners and stakeholders. John Nolan, CAD manager at Network Rail explains: “We have been early adopters of Bentley Descartes V8i (SELECTseries 4) and this new release provides us with exactly what we need. The software’s ability to create scalable terrain models now allows us to create and manage terrain models with hundreds of millions of points. With its fast scalable terrain model manipulation and very powerful modelling tools, Bentley Descartes allows us to integrate point clouds and engineering data into intelligent hybrid models.” ASSESSING NEW DESIGNS
the as-constructed and design information, including scalable terrain models, orthoimages, Bentley i-models (containers for open infrastructure information exchange), and DGN files. The model is used to streamline the interaction between design consultants and contractors by enabling the coordination in a 3D environment of all the designs from design consultants. This scalable 3D information model also supports design review by providing efficient 3D visualisation of the designs, including all engineering intelligence. The individual design models created in industry-specific design applications, including Bentley Rail Track, are available when reviewing and navigating the entire 3D information model in Bentley Descartes. By combining a large terrain model
Some of the challenges of this project included the lack of up-to-date information on existing assets and potential inaccuracies in existing documentation. To provide surveys of the existing track conditions, data acquisition was outsourced, with aerial LiDAR used for open areas and laser scanning technology for tunnels. High resolution orthoimages were also acquired. The point clouds were colourised and classified initially as ground and non-ground classes. Bentley Descartes was used to create a scalable terrain model directly from the classified point clouds by processing only the ground points. The scalable terrain model was then draped with high resolution images and the vector geometry engineering information referenced directly into the scene. The model was tiled to cover separate areas of tens of kilometres. In order to assess vegetation for clearance, the non-ground point-cloud data was also
Project Summary Organisation: Network Rail Solution: Rail Location: United Kingdom Project Objectives: • Design overhead line equipment for 1,000km of single-track railway in western United Kingdom • Create a 3D information model of the entire project by combining survey data and design models • Use the information model to provide context to assess designs provided by engineering contractors, support signal sighting and driver training, create 4D simulations for construction for vegetation management, and lastly as a live asset management model • Products used: Bentley Descartes, Bentley Navigator, Bentley Rail Track, Bentley i-model Composition Server, MicroStation, ProjectWise
Fast Facts • Network Rail used Bentley Descartes to create a hybrid 3D model of the entire project by combining survey and engineering data. • Survey data includes 950 route-wide point clouds (+/-50 millimetre accuracy, 60 points per metre density), and close to 30,000 images (five centimetre resolution). • Images stored in ECW format and managed with ProjectWise.
ROI • A scalable terrain model 402.34km in extent was created in one week, as opposed to 40.23km of traditional digital terrain model that would usually be created in the same time. Bentley Descartes allowed the scalable terrain model to be created 10 times faster. • Tunnel modelling was improved by a factor of three with a tunnel 1.75km long being modelled in one to two days with Bentley Descartes against one week with a standard CAD tool.
About BS 1192 BS 1192 is the British Standard that establishes the methodology for managing the production, distribution and quality of construction information, including that generated by information modelling software, using a disciplined process for collaboration and a specified naming policy. BS 1192 is applicable to all parties involved in the preparation and use of information throughout the design, construction, operation, and decommissioning of infrastructure across the project lifecycle and the entire supply chain.
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TECHNOLOGY
merged into the 3D information model. By integrating the coloured point cloud of the vegetation into the model, Network Rail was able to identify vegetation areas that needed to be reduced to meet the necessary clearance for the new overhead electrical infrastructure. TUNNEL MODELLING USING POINT CLOUDS
The Great Western Electrification Programme includes eight tunnels (Newport, Severn, Alderton, Patchway Old, Patchway New, Sodbury, Clifton Down, and Box) ranging from 700 to 7,000m long, which require detailed studies to enable the planned electrification. In such a confined and potentially dangerous environment, laser scanning technology allowed fast, accurate, and safe measurement. Although the point clouds by themselves provide great 3D visualisation and on-demand measurement capability, subcontractors needed traditional geometries with a high level of accuracy. Using Bentley Descartes’ Model by Section tool, Network Rail was able to quickly create loft surfaces of the tunnels. John Nolan explains, “The modelling capability of Bentley Descartes V8i (SELECTseries 4) addresses tunnel modelling perfectly. By defining a template of the tunnel cross-section and adjusting this template along the alignment, we were able to model tunnels in 3D with real-time visualisation of the generated 3D surface, which allowed us to assess quality as we digitised the model.”
Quick RoI Bentley Descartes allowed the scalable terrain model to be created 10 times faster
Tunnel Modelling Real-time visualisation of the generated 3D surface helped assess quality
EXTENDING ROI
In addition to streamlining the process among suppliers, and supporting BS 1192, the creation of an information-rich scalable 3D model including terrain data, point clouds, orthoimages, and i-models, provides numerous opportunities to extend the project’s return on investment from the project. The integrated model allows the creation of 4D schedule simulation showing each construction phase, supports project review, enables clash detection, and also allows driver training and signal sighting. In addition,
the model is very effective for showing local authorities and individual landowners what effect, if any, the overhead line electrification (OLE) works will have on them. LIVE 3D INFORMATION MODEL
The Great Western Electrification Programme is presently in the design and construction stage, but Network Rail is already planning for operations and maintenance by establishing an intelligent information model
to support long-term asset management. The scalable 3D information model will be reused and enriched to aggregate engineering files including DGNs and i-models, and to index asset information. Asset documentation, PDFs, images, and videos, are managed with ProjectWise and indexed in the scalable 3D information model. Users can therefore navigate and interact with the 3D model, and, by clicking on an asset, access associated documentation stored in ProjectWise.
“We have been early adopters of Bentley Descartes V8i (SELECTseries 4) and this new release provided us with exactly what we were looking for. Scalable terrain models now allow us to create and manage terrain models with hundreds of millions of points, the section modelling capability addresses tunnel modelling perfectly” JOHN NOLAN, CAD MANAGER, NETWORK RAIL
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CONSTRUCTION
CABLES
Performing under fire Dr Jeremy Hodge, chief executive at BASEC, explains why cable testing for fire safety is so important, especially when lives are at risk o ensure the safe evacuation of a building in the event of a fire, there are a combination of active fire systems such as emergency lighting, smoke control and extraction, gaseous fire extinguishing and firefighter support systems that need to be factored in. Many of these systems require electrical power supplies and control circuitry to remain fully functional throughout a potentially serious fire that could last many hours. In a high-rise building, in particular, it is vital that power supplies for fire-fighting lifts, smoke extract systems and emergency lighting remain intact for a prolonged period to ensure everyone can make it out of the building safely. There has been a number of fire-related incidents across the region – Doha Mall, a high rise building in Jumeirah Lake Towers and numerous villa fires in Sharjah – which further highlights the need for fire performance cables that are fit for use. Another problem seen is fires during the construction process, before all protection is fitted and active. These can be much more serious and special care needs to be taken during the construction phase. At the same time, architects, engineers and designers are taking advantage of new technologies to produce more elaborate layouts, which need more effective fire-performance systems. As prestigious buildings become more complex in this way, the need for higher performance cables has been identified by a number of manufacturers. Public buildings such as hospitals, shopping centres, office buildings with atriums, sports stadiums and even some high-specification residential premises all need to be using advanced fire safety engineering design approaches. Traditional fire protection approaches rely primarily on materials choice and passive
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“If there is a fire, it may not necessarily be the cable’s fault but the cables need to maintain circuit integrity under specific fire conditions”
compartmentalisation to provide limitations to fire growth and spread. Fire safety engineering techniques allow a more open building structure, but they ensure safe evacuation in the event of a fire by a combination of traditional approaches and modern, active fire systems such as smoke control and extraction, phased evacuation, gaseous fire extinguishing and firefighter support systems.
Flame propagation test using a gas flame Fire tests for cables vary considerably
CONSTRUCTION
Dr Jeremy Hodge in the BASEC lab The UK-based test and certification body is working with organisations across the region to raise awareness of cable safety
Many of these systems require electrical power supplies and control circuitry to remain fully functional throughout a potentially serious fire lasting many hours. Examples include power supplies for fire-fighting lifts and smoke extract systems. Robust fire resistant cables are needed in order to satisfy these needs, cables that have been tested under quasireal conditions and with proven performance. There are two main types of cable on the market. Those that, when subjected to fire, have low smoke emissions and are flame retardant, and those that are fire resistant, which will continue to provide circuit integrity for a certain period of time. While basic low smoke cables will contribute less to the growth of a fire, only those cables with circuit integrity fire resistance will provide the assurance of continuing operation. TESTING FIRE PERFORMANCE CABLES
Fire tests for cables vary considerably. Almost all cables, whether designed for fire
“Architects are incorporating more elaborate layouts in buildings and these require more effective fire performance systems” performance or not, undergo a simple flame propagation test using a gas flame. Cables with special fire performance characteristics undergo one or more tests from a range of possible tests including possible severity or survival time. For example, BS 7629-1 / BS 5839-1 cables may be tested to either BS EN 50200 Annex E or BS 8434-2, and classified as standard or enhanced grade respectively, offering 30 minute or 2 hour circuit integrity. Recently, more severe fire tests have been developed to assist architects and fire engineers in achieving higher levels of safety
in buildings using active fire protection such as smoke extraction systems, which rely on the continuity of power supply during a fire. An example is the test method specified in BS 8491, which is referred to in BS 7346-6 (components for smoke and heat control systems -specifications for cable systems). BASEC is also frequently asked about ‘low smoke halogen free’ (LSHF) type cables, and the requirements for this categorisation. Again, relevant cable standards specify that two tests are used – smoke emission in a 3m cube, and corrosive and acid gas emissions in a tube furnace. LSHF does not in itself mean that there is any circuit integrity performance. When specifying fire-performance cables it is not usually necessary to specify the individual tests a cable must pass. These are listed and specified in the cable standards, so simply specifying that a cable must fully comply with, for example, BS 7846 F120, means that all the relevant fire tests included in this standard must have been passed. A BASEC approval for this cable means that all such tests have been passed and are being regularly re-checked. This is an important fact – the third party certification of a cable means it has been independently checked! While the cable industry has safety standards, the fact that anyone can self-declare means safety and quality are interpreted differently. For example, even if a cable is marked with only a standard number, the probability that nobody other than the manufacturer has examined that cable is high. In the Middle East, BASEC and top cable manufacturers are working to support the work of the utilities, civil defence authorities and the Emirates Authority for Standardisation & Metrology (ESMA) to ensure that only approved cables are used in the country. Unfortunately there have been cases where the ‘entire chain’ from manufacturer through trader to contractor has been known to cut corners. Problems commonly encountered in faulty cables include undersized copper conductors with low conductivity, non-fire-resistant sheathing, and insufficient or poor quality armouring. This is then sold through unscrupulous traders at the cheapest prices. The problem is everyone is trying to save their five or 10%. When you get the end product in your hands, you may be actually looking at a serious problem without realising it. June 2014
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CONSTRUCTION
ENGINEERING
Between hangars and harbours In an exclusive interview with Shruthi Saraf, Juergen Strommer, Managing Director, Cavotec Middle East talks about his company’s key offerings in aviation, ports and maritime sectors, and successful projects What are Cavotec’s key markets within the infrastructure realm?
As a global engineering group, Cavotec manufactures innovative power transmission, distribution and control technologies that form the link between fixed and mobile equipment in airports, ports and maritime, airports, mining, tunnelling and other industry sectors. Supported by extensive engineering expertise drawn from applications around the world, we work closely with our customers and suppliers locally on the ground to deliver complete systems that meet the specific demands of each project. We are proud of our global reach with local presence. Our facility in Dubai has 4,525m2
office space and a warehousing facility with workshops staffed by fully trained engineers and technical experts, who support customers across the region. We also offer installation services as part of our system integration function, which is a unique offering in the region. Who are some of your key customers and references in the region?
Cavotec Middle East, our UAE-based subsidiary, has a large number of customer references at ports and airports in the UAE, Bahrain, Egypt, Jordan, Kuwait, Qatar, Oman, Iraq, and Saudi Arabia. Some of our most important customers include Dubai Airports Company, Bahrain
“With airports in the UAE projected to witness up to 1.62bn aircraft movements by 2030, operators are trying to find ways to ease bottlenecks”
Pop-up Pit Cavotec has carved a niche for itself in this area, supplying to all key regional airports
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Airport Company and Emirates Engineering Company. We have also worked with such companies as Alstom, ALEC, Abu Dhabi Airport Company, New Doha International Airport, Qatar Airways, Oman Airports Management Company and also companies like Lamprell, Universal Voltas, National Oilwell Varco, DP World, Gulftainer and Abu Dhabi Terminals on a variety of projects, encompassing a broad spectrum of solutions from power distribution to maritime to ground support equipment. What would you deem as your fastest growing markets?
In the Middle East, our fastest growing markets are aviation followed by ports and maritime. With airports in the UAE predicted to witness up to 1.62bn aircraft movements by 2030, operators are trying to find ways to ease bottlenecks and service each aircraft in a timely manner. Our solutions are geared towards decreasing aircraft service times by integrating various utilities into singular solutions like pop-up pits. This is a niche which we continue to build on as we enable airports to operate with high levels of efficiency with regard to time and associated costs. With sustainability being factored into new airport developments, our solutions are guided by eco-friendly philosophy. Cavotec continues to register strong growth in the Middle East, with our airports market unit inking new orders in the UAE, Kuwait, and Oman. We are currently fulfilling orders for frequency converters in Kuwait, pop-up pits for Salalah Airport, fuel hydrant pits and access covers for Muscat Airport, pop-up pits and pre-conditioned air units for Dubai, and pits with converters and pre-conditioned air units for hangars in Sharjah and Abu Dhabi. Cavotec also supplied, installed and commissioned in-ground pop-up utility and PCA units for new A380 hangars at the Emirates Engineering
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is in service at two container-handling berths at the Port of Salalah in Oman. Cavotec also supplies shore-to-ship Alternative Maritime Power systems, Panzerbelt cable protection systems, power chains and connectors, marine propulsion systems, radio remote controls and motorised and spring driven cable reels. Our recent successes in the UAE maritime equipment market include a major contract for motorised cable reel technologies that powers 19 ship-to-shore cranes and 50 rail-mounted gantry cranes at DP World’s Jebel Ali Port Terminal 3. In another project, we helped install 30 Automated Stacking Cranes (ASC) and six STS cranes to Khalifa Port in Abu Dhabi. These units have been operational since September 2012. Cavotec Dabico In-Ground Fuel Systems Aviation is Cavotec’s fastest growing market in the Middle East
Do you plan to get into any other sectors apart from the four that you outlined at the start?
Centre at Dubai International Airport. Cavotec recently signed a contract with ALEC to provide large numbers of pop-up pits for 400Hz and PCA outlets, 400Hz frequency converters and PCA units as part of Dubai Airport’s extension which will see the construction of 17 stands at Concourse 4, four of which are capable of servicing large (MARS Code F) aircraft such as the Airbus A380. Currently, our solutions are in operation at Dubai Airport’s Concourse 1, Concourse 2 and Concourse 3.
As a dynamic company, we’re always looking for new innovations and synergies in markets to further develop our group. But having said that, our focus has always been on our core industries: airports, ports & maritime, mining and tunnelling and general industries. Being focussed on these four key areas has allowed us to move to the forefront of these sectors. This same strategy has enabled us to establish nine different centres of excellence developing different products and solutions for a variety of applications. The aviation sector in the region is expected to grow more, so it is still one of the future growth areas that Cavotec is very keen on supporting. The other industry we are continuously engaging with is ports and maritime. Thanks to population growth, shipments are steady rising which means that ports need to keep up. Cavotec is ready to help operators whether they want to expand their capacity or optimise existing resources.
Could you elaborate on your ports and maritime business?
As Middle East’s ports sector strive to further improve their safety standards, operational efficiency and environmental performance, we are seeing growing interest in our automated mooring technology from port operators and shipping lines in the region. Our MoorMaster technology reduces the time taken to moor a ship from up to 90 minutes to about 30 seconds in what becomes a one-man operation. MoorMaster is a vacuum-based automated mooring technology, in which remote controlled vacuum pads recessed in or mounted on the quayside or pontoons, moor and release ships in seconds. It offers increased safety for shore and ship personnel, improved operational efficiency, and in some cases, reduced infrastructure investment. It also reduces emissions from ships and tugs. Our automated mooring system
Juergen Strommer MD, Cavotec Middle East
Focussed solutions Cavotec’s 400Hz cable coils, mobile GPUs, pop-up and hatch pits, refuelling systems and Wibe cable management systems serve airports in Abu Dhabi, Bahrain, Dubai, Jordan, Kuwait, Oman, Saudi Arabia and Qatar. The company’s ports and maritime unit also produces shore power systems, Panzerbelt cable protection systems, cranes controllers, marine propulsion slip rings, power chains and connectors, radio remote controls, motorised and spring driven cable reels and steel chains.
What products and solutions are you planning to launch in the near future?
In our continuous objective of improving our products performance and their life cycle, we have engineered a new environmental fuel hydrant pit (DAB-20) and developed a new 400Hz connector, more durable and designed for a quick repair or change as gates cannot be closed for too long. We have other major products in the pipeline that will be launched by end of this year. June 2014
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CONTRACTING
A green future Gavin Davids speaks to leading MEP contractors to find out how the industry is ready to push forward with renewed impetus thanks to the introduction of the green building codes t the start of this year, Dubai Municipality announced that a set of new green building regulations would be made mandatory for construction projects in the emirate. This announcement followed a successful test phase – which began in 2010 – that saw 40 government buildings successfully implement the new law prior to it being rolled out across Dubai. Although it rarely receives the recognition it deserves, the Mechanical, Electrical and Plumbing or MEP sector has always been at the forefront of sustainability efforts. Perhaps this is a consequence of the environment it works in. With water resources in the GCC already scarce, MEP contractors have always looked to be proactive with the systems they install to help maximise performance and minimise wastage. To this end, they looked to the West, where sustainability measures have long since been embraced. As such, the top level MEP contractors in the region welcomed the moves by the Dubai Municipality and the Abu Dhabi government to introduce the green building regulations, confident in their ability to meet up to the standards required. Despite this optimism, there remains a few concerns that must be addressed before any true progress is made, these experts tell Big Project Middle East. “The biggest issue for us is to deal with unqualified MEP contractors in the market,” says Burak Kizilhan, board member at AE Arma Elektropanç, a Turkish MEP giant operating on projects throughout the GCC. “They drop the prices surprisingly low and sometimes there are companies who signed the projects with our dry cost. This kind of competition is making life very difficult for MEP contractors,” he explains. Masood Raza, General Manager, Jumbo Engineering, is quick to agree with
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High Expectations MEP contractors say that despite being the last on board, they have to finish first
Kizilhan, expressing his concerns about how this could impact the implementation of the green building codes for MEP. “Because of the green building regulations, where you have to comply with Estidama, you’re often competing with other parties who don’t even know what Estidama is all about. So in that case, you’re done. You don’t know where the prices are going.” However, Nathan Hanns, the general manager of ALEMCO, the MEP arm of ALEC, says that it’s not all doom and gloom. He points out that every industry has its issues, but it’s up to the industry to be positive and drive change through as it ultimately benefits everyone involved. “Every industry has its problems and it is easy to be judgemental. I personally believe the best method for ensuring that sustainable practices are put in place is through governance and ensuring that the construction regulations are in place. The better the governance, the better the end product, as simple as that.
Hanns believes that a major risk for subcontractors, as a business, is going to be the growth in the GCC region. He says, “With the growth that is forecasted for 2020 and 2022 occurring in various regions within the GCC, there is going to be a shortfall of skilled resources. The key to our success is our resources. I think over the next two to three years, it’s going to be demanding for companies to get the skills and resources that they require.” DEALING WITH COMPLEXITY
With this in mind, there are a number of methods to address the challenges that loom ahead. While Raza firmly believes that education will benefit all parties, he does concede that things have become a little more complex. “Definitely, we need more education at all levels, but I think that will grow now because both the major emirates have got existing and very clear regulations,” he asserts.
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“Things will definitely improve, I’m very positive about that. Education is very important, investors need to know that you have to be sustainable while you’re constructing different projects. What we’re seeing now is that the challenges are going to increase. There’s going to be more design challenges and the job of MEP contractors will become quite critical. Things have changed and consultants have started taking on board all the requirements and being very specific about what they want. So it’s going to be very challenging for contractors to price things, if you’re not aware of what you have to do.” Burak Kizilhan expects Expo 2020 and the 2022 FIFA World Cup to have an enormous impact on the construction market in the region, which will in turn bring bigger challenges to the MEP industry. “The importance of qualified MEP contractors is now vital in order to meet the project deadline and keep the client happy. In addition to that, the proportion of MEP works is getting increased as the magnitude of the construction projects is so big. That is the reason why the pressure on MEP contractors is higher than usual,” he warns. MORE PRESSURE ON MEP
Given the increase in pressure that both Kizilhan and Raza warn of, perhaps more can be done to address the situation MEP contractors find themselves facing? Hanns certainly thinks so. He elaborates: “You have to look at the methods of how MEP contractors are generally appointed on projects. The consultants will develop the design based on a concept design. The governance will determine the benchmarks and then clients will adapt the benchmarks either in line with the governance or higher to suit their end product requirements. “So when we tender for a project, we could be tendering with the governance in place, as well as any additional project sustainability targets. The tender will then go to the open market. The open market conditions have been quite severe over the last three to four years and there has been a lot of price cutting and value engineering.” Hanns points out that that the pressure is always on the subcontractor to make sure that the systems conform to the governance and to design that has been specified in the contract. “I’d say that yes, the pressure is there, but the budgets are not necessarily there.
I think the government codes enforce a certain level, but the developer or client are selecting the type and ratings of their buildings which will determine the systems that we eventually install into a building. The design is carried out in line with the developer or client selection process. We are then at the end stage of the construction process. We can only control the selection of the equipment and the materials as well as where we source the materials from and how we construct it and set it into operation. What we’ve seen in the past is not necessarily the focus of the end-user. The building design and systems are sometimes more cost driven rather than efficiency driven. The intention can also be diluted through the tender process and through the tender negotiation which will affect the final product. There is a change in the market towards more efficient buildings, but better change can be produced in the market by governance. At the end of the day, governance changes what we do.” This is an area where Raza says he’s in complete agreement, pointing out that there are often unreasonable expectations facing MEP contractors, given that they’re involved late in the project construction lifecycle. He elaborates: “We have identified two or three things actually that are very interesting. The fact is that MEP comes last in the cycle of the project. It’s the last to be awarded, but the expectations are very high for that. Not only are they very high, but you have to finish it before they handover the building for inspection. So we face this challenge almost every day as an MEP contractor. You’re the last on board and you have to finish the first. Sometimes it’s very difficult to spend more time in design and planning, which is, in my opinion, the best thing (to do). That is where the project either wins or fails. I feel there’s always pressure from investors because
“The fact is that MEP comes last in the cycle of the project. It’s the last to be awarded, but the expectations are very high for that” MASOOD RAZA, GENERAL MANAGER, JUMBO ENGINEERING
they want to beat the inflated prices, so they want everything to finish tomorrow, because they want to finish the project faster. As a result they spend less time on designing and planning and so partially designed project comes to the MEP contractor, and they have to fill in the gaps almost everywhere and that becomes more challenging to us.” THE ROAD AHEAD
So what lies ahead for the MEP industry, given the challenges that have been outlined? While all three experts are positive in their industry outlook, they feel more needs to be done in terms of new technology adoption. “I think there’s different governances that are coming out that are affecting us in different ways,” says Hanns. “In Dubai we are focused on the Etihad and ESCO sector of works, which is a great initiative based on the refurbishment and upgrade of existing facilities to obtain energy savings. There are a lot of buildings in the UAE that have been built within the last 10 years. The majority of these have been constructed with the new building codes and have relatively advanced building systems; however, the older buildings are outdated and the energy efficiencies of the buildings can be easily increased. So that’s something new we have to focus on. “Some of the projects that we operate on are refurbishment-based which includes the upgrading of building systems and facilities and changing to more efficient installations. We see a lot of drive in the market in this direction and there is a lot of opportunity for increased efficiency by end-users.” Raza adds that with the new green building codes, there will be new development in areas like VRV and VRF systems, while fresh air treatment will increase – with the focus on proper recirculation and heat recovery. “We see that intelligent and LED lighting systems will be used more and more. There’ll be recycling units coming into play. We’re already looking at grey water treatment systems for some of our buildings,” he explains. “There’ll be intelligent control systems and there’ll be new innovations coming through. It’s a very exciting period of construction business. “We’ve been very lucky with companies like DEWA and Dubai Municipality affiliated companies. All of them are government run bodies that enforce green technology. So I would say that if we’re not ahead, we’re on the learning curve.” June 2014
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UTILITIES
INTERVIEW
Finding niche in scale Ranjit Singh, Managing Director, EMEA Region, at APR Energy tells Infrastructure ME how his company is raising the bar in the rental power business
Rapid deployment APR can supply its mobile dual-fuel gas turbines to the client site by air
What differentiates APR Energy from the rest of the players in the rental power business?
Large scale, movable and scalable power is APR Energy’s biggest distinguishing factor. We don’t look at 1, 2 or 5 MW projects. Our typical plant sizes range from 40 to 100 MW and above. Our focus is primarily on scalable large projects for our customers. They may start with a 40-50 MW power plant based on mobile dual-fuel gas turbines (aeroderivative) or diesel or natural gas power module units. But, invariably, when their needs increase, we can scale up the generation capacity quickly. In fact, the singlemost distinguishing factor between us and competition is our mobile dual-fuel turbine technology – we are the only ones offering it worldwide, where the customer can use either natural gas or diesel.
MOBILE GAS TURBINES In October 2013, APR Energy announced that it has entered into a strategic alliance with GE to tap the growing fast-track turnkey power solutions space. Under the terms of the deal, GE contributed its turbine rental business to APR Energy in return for cash and approximately 16.5% of APR Energy, making GE a key strategic investor in the company. The transaction made APR Energy one of the world’s leading fast-track mobile gas turbine power provider, expanding reach into new regions and increasing its mobile turbine power capacity to 1.2 GW. The deal also
Could you elaborate on what large scale, movable and scalable power stands for? By large scale, are you limited to utility projects?
included approximately 520 MW of capacity
We look at markets in terms of utility and industrial generation and how APR fits into their power needs. There is an acute need for power supply worldwide, more so in the Middle East & Africa (MEA) region. But what are those needs? These could be emergency
and Bangladesh. The dual-fuel GE TM2500+
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and rental contracts that GE had in place in Canada, Iraq, Australia, US Virgin Islands, turbines enable APR Energy to deliver large blocks of power within days or weeks and can be integrated into existing infrastructure.
needs, distributed generation, industrial needs or utility driven needs like bridging power, and we serve these across the board. In the case of Libya, they needed power for grid stability and general needs. There isn’t enough supply because the power plants aren’t working. We have six sites in Libya, some of them remotely located, generating 450 MW continuously for the utility GECOL. We have over 520 MW of generating plants sitting in the country made up of dual-fuel mobile gas turbines and diesel generators. In March this year, APR Energy signed its largest industrial contract, using mobile turbine technology to power mining operations in the South Pacific. Our solutions, both on the power module side (diesel, natural gas) and the turbine side are scalable. On the turbine side, you can add 25 MW at a time. If the utility or industrial customer has estimated a long term need of 200MW, for example, they can contract generation capacity in phases. Of course, one turbine equals 14-15 diesel power modules and its size is much smaller. However, the same approach is used for scaling up power plants based on our diesel modules.
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operation and maintenance are the same. Apart from local people, we also have our own employees on site because they have the expertise to run such sites and manage the equipment. Moreover, the equipment we use is very expensive.
To reiterate, our sweet spot is the larger power deals and long term contracts. We may sign a contract for a year or six months but invariably, most of these contracts get extended. We have good success rate in extending these contracts because we also look at the issue from the customer’s side in terms of how long it is going to take them to resolve the supply deficit. Sometimes, budgetary limitations may restrain customers from signing long term contracts but they also know what they need two to five years down, so there is a renewal process. And we are more than willing to engage in that discussion with our customers.
How are hubs like Dubai helping your company grow?
How do you stack up on the operational capability front?
Nearly 50% of our generation capacity comprises mobile dual-fuel turbines. We have built up tremendous amount of expertise and competencies in turbines. But we also have tremendous competency in diesel power modules from our past and continuing business. Having built up the turbine business over the years, we have achieved quite a bit of learning and training within our team. We also have a strategic alliance with GE – we purchased their turbine rental business and they own a 16.5% stake in APR. Thus, apart from in-house experts, we also have the expertise of GE at our disposal. We talk to them every single day. We also put a lot of time, effort and resources to ensure the reliability of our equipment for the customer. Any industry that owns capital equipment, whether it is a car rental or an industrial solutions business, don’t want the equipment to stay idle for long periods. If you look at the airline industry, they plan to the minute to get their equipment back in the air, and it’s the same with us as well. We don’t want our equipment to be sitting around in a hub unutilised. We try to do a good job in terms of utilisation of our equipment and maintaining it. Do you also take on the responsibility for fuel supply or connecting to the grid?
We are good at generating power and operating our machines. We provide a full turnkey solution, right from civil works on the site to putting in the fuel and switch yards
Ranjit Singh Managing Director, EMEA Region, APR Energy
to interconnecting to the customer’s point of connection to maintaining and operating our equipment. We don’t want to focus on delivering fuel or setting up a T&D system. However, we use as many local resources as possible, whether it is people, purchasing of equipment, balance of plant or consumables. We want to give back and be an integral part of the community we are involved with. It is a very important component of our success, especially with our top management mandating that we use as much local content as possible. In all our jobs, we have local content. In Libya, for example, we are employing a huge amount of local talent. We are currently training 80 employees of GECOL after they requested our help to train their people. They work for APR Energy at our sites, while learning everything about operating and maintaining our equipment. The advantage of this arrangement is that their learnings are transferable to other power plants. While our turbines are of a different scale than typical large-scale gas turbines, the basic principles in terms of
We opened these hubs some years ago to focus mainly on logistics and procurement. We wanted to ship the equipment as they went from one opportunity to another rather than shipping it back to a central location, and moving it out again. Thanks to our hubs, we are able to strategically place equipment where we think we need it. We are also able to do maintenance and repair on that equipment on-site or somewhere close to the hubs. Now we have put full management teams in each of the hubs so that we are closer to the customer in addressing their needs. With APR growing quite quickly in terms of projects, size and revenues, we didn’t want to run everything from a central location. It is harder to serve a customer’s need when you are so far away in terms of time zones or in terms of people and equipment. I think having a full management team in each hub is an important distinction because increasingly, the customer is demanding fast track moveable solutions. When we are in the region, we can understand their needs and business, and become more attuned to being able to deliver on their requirements. We believe that this strategy is going to help us grow in the marketplace. What are you doing to improve transport and logistics in the region?
In almost every country in the Middle East & Africa region, there isn’t enough supply of power. Whether it is permanent power or fast track scalable solutions, there is an acute need for power. The demand for power is being driven by growth, in terms of industry, economy and population. Ten years ago all the attention was on the BRIC countries; today it is MEA. I think the potential is endless.
“We use as many local resources as possible, whether it is people, purchasing of equipment and balance of plant or consumables. We want to give back to the community, be an integral part of each community we are involved with” June 2014
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AVIATION
High fliers Geographical location, deep pockets, effective decision-making and strong ties with Asia have contributed to the region’s aviation success By Shruthi Saraf n the Middle East region, an estimated $100bn investments have been planned for airports expansion and new developments including $40bn in the GCC. According to International Air Transport Association (IATA), the Middle East is expected to have the third fastest growth rate at 6.6% until 2016, making it the second-fastest growing aviation market. With such numbers being bandied about, the 14th edition of the Airport Show proved to be one of the busiest gatherings of the region’s key decision makers involved in airport procurement, supplies, solutions and technology businesses. This year’s Airport Show, which the organisers claimed was the most successful one since the event’s launch in 2001, also had two co-located events, the inaugural Travel Catering Expo (TCE) and second Global Airport Leaders’ Forum (GALF). HH Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority,
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Chairman of Dubai Airports and Chairman and Chief Executive of Emirates Airline and Group and The Airport Show’s patron, said its success reflected the unfaltering global interest in the Middle East aviation market. He said: “Airports in the MENA region, currently under various stages of expansion and upgrades, are projected to cater to 400m passengers by 2020, with the UAE airports taking one-fourth of the share in the anticipated growth in air passenger
“Almost all high-tech supply chains and business services exports are connected by aviation, thus the 21st century economy is becoming an aviationbased economy” DR JOHN D KASARDA, ORIGINATOR OF AEROTROPOLIS CONCEPT
traffic. Billions are being invested to provide the additional airport capacity required to accommodate the increased demand.” AIRPORT DEVELOPMENT IN THE UAE
The second Global Airport Leaders’ Forum (GALF) put crucial aviation issues under the spotlight with the inaugural session seeing key players from the UAE and global aviation industry debating about enhancing competitiveness to broaden the socio-economic role and contribution of airports. Topics included Aerotropolis; Airports as economic pillar to increase national competitiveness; Technology as a game changer for airports; Open skies; Airports and airlines synergies and Airport security in a highly-mobile world. In his welcome speech, Eng Khalifa Al Zaffin, executive chairman, Dubai Aviation City Corporation said the first phase of Dubai World Central (DWC), an 140km economic zone that supports logistics, aviation, commercial, business, humanitarian, and residential activities around the Al Maktoum International Airport, has been
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completed and work is already underway to accelerate the development in all major components in the coming years. Referring to the multi-billion dollar DWC being developed as the region’s first Aerotropolis, he said: “The potential of this ambitious project in terms of economic, social, and environmental benefits are very immense. A world-class infrastructure, economic diversity, and long-term investment opportunities will take Dubai’s aviation industry to new heights.” In his keynote address, Omar bin Ghaleb, Deputy Director General of General Civil Aviation Authority (GCAA), said the region’s aviation industry has been able to continue to grow and expand despite enormous challenges and obstacles. Forecasts suggest that the airlines in the Middle East plan to invest $450bn to acquire 2,525 new aircraft by 2030, which will increase the size of their fleets by 160% in 2030, up from the present 1,060 aircraft. Bin Ghaleb pointed out that the GCC, thanks to its strategic geographical location and the gradual transition of economic gravity towards Asia, will witness a substantial growth of 7.6%, above the global average of five per cent. Both International Civil Aviation Organisation (ICAO) and Airport Council International (ACI) predict that by 2020, the Arabian Gulf states will serve 450m passengers annually while total aircraft movements in the Gulf airspace will reach over 2.3m, making it the most congested airspace in the world. Aircraft movements in the UAE airspace, continued bin Ghaleb, will increase to 1.62m by 2030 with aircraft movements numbering 4,400 per day compared to 2,200 aircraft movements at present. Last year, the GCAA awarded Airbus ProSky the contract of redesigning and upgrading the airspace to cope with the growth in air traffic in the UAE Flight Information Region (FIR). As many as 53 recommendations made by Airbus ProSky are being carried out across a broad spectrum of airports operations and air traffic management. “The challenges faced by the aviation industry are huge, while the quick solutions are limited,” admitted bin Ghaleb. “We need to look at broadening cooperation and coordination among the stakeholders and adopt latest technologies that will contribute to air traffic management efficiency to accommodate the anticipate air traffic growth.”
THE AIRPORT SHOW IN SUMMARY • • • • • • •
250 exhibitors from 39 countries Over 7,000 visitors 12,600 sqm of gross exhibition space 105 Hosted Buyers from 19 countries Six country pavilions featuring 66 companies 40 new technologies, products and solutions 30 speakers at the leadership forum
OPEN SKIES
Globally, aviation liberalisation has remained the biggest challenge impacting the growth of airports in view of the high volume of passengers and aircraft movements. Duncan Alexander, Director of West Asia, Pacific Asia Travel Association (PATA), moderated the session on Open Skies, which drew participants from the regional aviation industry, including airports and airlines. Panellist Jamal Al Hai, Executive Senior Vice-President for International Affairs & Corporate Communications Dubai Airports, and former member of UAE’s Federal National Council (FNC), emphasised that Open Skies is central to UAE’s winning strategy for the civil aviation development, alongside massive investments in airports and airspace management, expansion of air connectivity for cargo and people movement across the
world. The UAE has signed more than 160 Air Services Agreements (ASAs), of which majority are Open Skies arrangements. Commenting specifically on Dubai, Al Hai said that Dubai International and Al Maktoum International airports will have about 665,000 aircraft movements by 2020, double the volume these world-class facilities handle now. By 2025, Dubai’s passenger and cargo aircraft movements are projected to reach 416,650 and 35,000 respectively. Dr Hamdi Chaouk, Director General of Lebanon’s Civil Aviation Authority, said that Arab countries signed the Damascus Declaration on air transport liberalisation but there had been unsatisfactory progress on this front when it comes to practice. Ibrahim Khayat, President of Dubai-based International Centre for Strategic Analysis, said governments should adopt a better approach and strategies to tap the full potential of the aviation to the economy and society. In his presentation, Michael Herrero, Manager for Gulf Area at IATA, said the governments and all the civil aviation industry stakeholders need to cooperate and collaborate more in policies and processes to handle the rising number of air passengers which will reach 5.9bn globally in 2030, up from the three billion recorded in 2013. He elaborated on an IATA initiative called SmartS (formerly known as the Checkpoint of the Future) designed to ensure seamless and hassle-free passenger facilitation at the airports. The project is being trialled at two European airports
Strategy talk HH Sheikh Ahmed bin Saeed Al Maktoum and Jamal Al Hai, Executive Senior Vice President of Dubai Airports
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On higher ground This year’s edition featured six country pavilions including the first ever US and Canadian pavilions
and will be introduced in other countries, including the Middle East region, in phases. Herrero said: “Technology and processes are there to ensure better safety and security. What we need is collaboration and working together. We have to change the way we look at the situation.” At the panel session on passenger experience, aviation experts discussed how seamless experience and excellence are determinant factors in the success of airports. They also discussed the success of a number of countries that have excelled in airport management and development, as well as other issues ranging from privatisation to generating additional revenue streams and reducing operating costs and betterment of passenger facilitation. Panellist Dr Andreas Wittmer, Managing Director of Centre for Aviation Competence at the University of St Gallen, Switzerland pointed out that ideally, airport management and airlines management should be integrated. Otherwise, passengers are taken for granted reflected in poor
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ground handling of passengers. Fellow panellist Thani Abdulla Al Zaffin, Director General and Board Member of emaratech echoed the opinion and stressed on the need of changing the mindset of the ground staff, right from security to immigration, to the airlines support staff. “People like to use the latest technology, but they first have to change the mindset,” he said. Talking about the phenomenal growth of Smart Gates used by passengers to pass through immigration gates at Dubai airports without being attended manually, he said, “We need to educate the passengers to reach the goal. It should not be annoying for them.” THE AEROTROPOLIS CONCEPT
Keynote Omar Bin Ghaleb, Deputy Director General, General Civil Aviation Authority (GCAA)
The session on Aerotropolis at GALF saw US academic and father of Aerotropolis concept, Dr John D Kasarda, Dr Gene Eu Jan, Financial Vice President, Taiwan Taoyuan International Airport, and Eng Khalfan Said Mubarak Al Shueili, General Manager– Readiness, Oman Airports Management Company sharing their perspectives on the
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new urban form of placing airports in the centre with cities growing around them. Hamdi Osman, Former Senior VP and CEO of FedEx Europe, Middle East, Indian Subcontinent and Africa, moderated the session. Kasarda, who developed the Aerotropolis concept in the year 2000, noted that airports have evolved as drivers of business location and urban development in the 21st century in the same way as highways did in the 20th century, railroads in the 19th century and seaports in the 18th century. As economies become increasingly globalised and dependent on electronic commerce, air commerce, the speed and agility it provides to the movement of people and goods has become its logistical backbone. An Aerotropolis has an airport city at its core and is surrounded by clusters of aviation-related enterprises that gain a competitive advantage by utilising each other’s strength and capabilities. Kasarda, who is the Director of Centre for Air Commerce at Kenan Flagler Business School of the University of North Carolina at Chapel Hill, said Aerotropolises were coming up in the Middle East, China and India as each region prepares to take its place on the world stage. He said: “The fastest, best-connected places will win and the future belongs to the city that can see the writing on the wall before the competition can even see the wall. Without sufficient air connectivity and efficient aviation infrastructure, the basic engine that drives the airport city will sputter. While implementing Aerotropolis model, it is important to keep in mind that the first and foremost thing a successful airport city requires is a successful airport which can move growing volumes of passengers and cargo efficiently. Airport cities and Aerotropolis are valuable regional and national assets, as
“We remain strongly committed to aviation’s growth and our investments and developments in this crucial economic sector remain strong and unfaltering as ever before” HH SHEIKH AHMED BIN SAEED AL MAKTOUM
well as airport assets. Properly planned and developed, they promote regional and national business efficiency and attract additional passengers and cargo. Airports and their surrounding areas have become as much destinations as places of departure.” Kasarda pointed out that airport master planning must change with more focus on commercial layout and efficiencies. Ideally, the commercial components and aeronautical components should be energised. “Air logistics and the new economy are inextricably interwoven,” he said. “Over onethird of the value of world trade already moves by air. Almost all high-tech supply chains and business services exports are connected by aviation, thus the 21st century economy is becoming an aviation-based economy.” RIGHT IN THE MIDDLE
Opening remarks Eng. Khalifa Al Zaffin, Executive Chairman, Dubai Aviation City Corporation
IN NUMBERS
$40bn
GCC region’s total investment in airport sector
160%
Increase in regional airlines fleet by 2030
1.13m
GCCA’s estimate of the UAE’s aircraft movements in 2015
70m
The number of passengers that Dubai International Airport is projected to handle this year
32%
The aviation sector’s contribution to Dubai’s GDP by 2020
A key message from the 14th edition of The Airport Show was the Middle East’s rise to prominence as a critical market for the global aviation industry, in tandem with the shift of global economic gravity towards Asia. The GCC’s location and geography puts the region squarely at the cross roads of aviation, a point proved by Dubai, which pioneered the Open Skies concept in 1930s, and now serves as a global reference on how the aviation sector can transform national economies for the better. It has been estimated that $82bn have been invested in aviation infrastructure development in Dubai since the formation of the UAE in 1971. As Jamal Al Hai noted in his address: “The seed of civil aviation that was sown in the middle of the vast Arab desert, at a time when the means of livelihood and infrastructure minimalist, has blossomed into a huge tree with its roots not only gaining solid grounds but providing opportunities for other sectors to flourish alongside.” In the first two months of 2014, Dubai Airport overtook London’s Heathrow Airport as the world’s busiest in terms of passenger numbers. The closure of the former’s two runways for 80 days for maintenance with effect from May 1, 2014 prompted several airlines to curtail their operations or move their flight operations to either Al Maktoum International Airport in Dubai World Central (DWC) or Sharjah International Airport. But with the authorities confident of handling 70m passengers this year, the 80-day dip may prove to be a temporary blip in Dubai Airport’s steady journey towards becoming the world’s busiest airport next year, this time for keeps. June 2014
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INFRA INSIGHTS
Theuns Kotzé
“Strong asset management practices can help deliver stakeholder requirements”
Adding value Theuns Kotzé, Regional Managing Director – BSI Middle East and Africa talks about the significance of the ISO 55000 asset management standard for the region’s utility sector he utility sector (energy, gas, water) has significant asset infrastructure. Over time, if not properly monitored and managed, these assets may pose a risk to their stakeholders and customers. Key issues that impact energy, water and gas assets include changes in regulations, policies and financing requirements. What the new ISO 55000 standard does is give the utility industry guidance on asset management best practices. It provides a framework, which integrates an organisation’s strategies, business process, information management, asset planning and investment, asset operation and maintenance and related people-competencies. This structure helps companies carry out all activities consistently, while adding value and reducing risks. The utility sector is expected to be a key growth driver for engineering, procurement and construction spending in the region. Hence, sound and strong asset management practices must be in place to deliver the
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requirements of stakeholders and customers. In the UK, for example, the water industry has been shifting to proactive preventative maintenance from reactive maintenance. With the implementation of this new standard, leading performance indicators will warn of non-compliance with the performance requirements of the asset management system and/or the assets and/or asset systems; similarly, lagging performance indicators will enable detection of, and provide data about, incidents and failures of the asset management system, and incidents, failures or deficient performance of assets and/or asset systems. This helps keep the assets in optimum condition while maximising their life expectancy. Additionally, a proactive approach to managing the lifecycle of assets can assist companies replace ageing infrastructure while maintaining services. The new ISO 55000 asset management standard delivers the following: • Enhanced risk and performance management through well informed decision making • Enhanced strategic planning
through access to better asset related management information • Enhanced reputation through improved customer satisfaction • Minimised environmental and social impact through robust risk management • Increased sustainability through management of short and longer term expenditures • Improves financial performance through better return on assets • Improved customer and stakeholder satisfaction through assured performance of assets Effective asset management can help companies allot their funds available for investments to better use; help managers, technical specialists, engineers and financial professional assess the asset’s performance and help them with decision making in terms of recognising risks, optimising assets and improving efficiency, thereby delivering better standards of service to customers. (Editor’s Note: ISO 55000 standards are based on the British Standards Institute document, BSi PAS 55, first published in 2004 and updated subsequently in 2008)
EVENTS
Also coming soon… POWERGEN MIDDLE EAST 12–14 OCTOBER, 2014, ABU DHABI Attracting delegates and attendees from over 50 countries across the MENA region and around the world, this event is the industry’s leading platform to meet and network with senior executive and industry leaders. Contact: Sue McDermott Tel: +44 1992 656 632 Email: suemc@pennwell.com www.pennwell.com
HAPPENING IN DECEMBER
MS AFRICA & MIDDLE EAST 2014 11-14 December, Cairo armomacc and Samoter have joined forces with Art Line/ ExpoLink, two Egyptian show organisers, to organise MS AFRICA & MIDDLE EAST The International Trade Fair for Stone Design, Technology, Earthmoving and Building Machinery - in Cairo. The two internationally-recognised Veronafiere exhibitions bring excellence in the building, materials, know-how, technology and machinery sectors to the Middle East North & Africa’s emerging markets. Veronafiere International Department Manager, GianPaola Pedretti said: “The International Buyers Programme of MS Africa & Middle East, the Marmomacc and Samoter event for Africa and Middle East markets, will increase the international dimension of the event and create unique opportunities for exhibitors to build relationships with distributors/ importers, construction companies, design/architecture studios and international end-users.
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Each exhibitor will have business meetings with buyers selected according to the desired profile. In addition, we are featuring an educational course for architects and interior designers in collaboration with RIBA (Royal Institute of British Architects).” The event aims to combine the entire natural stone chain in a single event, from stone quarrying and processing to quarry and construction site machinery and vehicles, through to the finished product. It expects to attract a broad audience of buyers including architects and interior designers, main contractors and construction companies, distributors, rental companies, professionals in the quarrying world and earth-moving equipment.
Contact: Veronafiere International Department Tel: +39 045 8298 800/428 Fax: +39 045 8297 800 Email: vfi@veronafiere.it www.msafrica.net June 2014
MENA RAIL AND METRO SUMMIT 2014 20–22 OCTOBER, 2014, DUBAI Now in its 10th year, MEED’s MENA Rail & Metro Summit incorporates a focused agenda exploring key themes and issues regarding projected rail plans, with case studies by GCC and MENA stakeholders and operators. Contact: Chichi Osagawu Tel: +9714 368 1644 Email: sponsorship@meed.com www.meedrailprojects.com META PROJECTS 2014 17–19 NOVEMBER, 2014, DUBAI META Projects focuses on project finance in the Middle East, Turkey and Africa. Decision makers from the industry can hear about the project pipeline in the region and learn where the investment potential lies. This year, the event has a dedicated day for renewable energy. Contact: IFP Qatar Tel: +44 20 7045 0933 Email: Elisabeth.Squires@ GFCConferences.com www.metaprojectsexpo.com
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Photo courtesy KONE Cranes
INFRASTRUCTURE MILESTONES
#005 Khalifa Port
A million TEUs - the equivalent of 18,500 medium-sized dhows - within 15 months of operations, is not an insignificant achievement. Welcome to the UAE’s newest mega port t wouldn’t be an overkill to claim that the UAE is a country of firsts when it comes to ports; Dubai’s Jebel Ali Port is the largest port in the region, the ninth largest container terminal in the world (and the largest outside Asia), and thriving, for the past 34 years, in the world’s largest man-made harbour. Next door, in Abu Dhabi, the Khalifa Port made its debut in 2012 as the Middle East’s first semi-automated and perhaps, its most technologically advanced container terminal. With a 4km quay wall and 18 metres draft, the port is capable of handling the largest ships in the world; a point proved when it easily handled the 14,000 container MSC Bari, one of the world’s largest mega container ships that came visiting on September 1, 2012. Khalifa Port boasts of nine of the
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world’s largest ship-to-shore cranes, and an automated stacking system (with 36 automated stacking cranes), equipment not found in any other port facility in the Middle East. A fully automated gate process with sophisticated systems like Radio-Frequency Identification and OCR (Optical Character Recognition) portals ensure significantly faster truck turnaround times without drivers needing to leave their vehicles. Currently, the container terminal is turning trucks in under 13 minutes. For the waterside operations, Crane OCR and a Position Detection System tracks every container move, resulting in more accurate and efficient operations. Located on reclaimed land situated 4.5km off the coast of Taweelah, Khalifa Port’s master plan includes well-constructed and structured phased developments. The first phase allows for an annual handling
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Fast facts Start of operations: September 2012 Total Area: 2.7 sq km Distance from Dubai: 75km Container throughput in December 2013: 100,000 TEU Crane moves per hour (GMPH): 34
capacity of 2.5m TEU containers and 15m tonnes of general cargo. As the port island has a total design capacity of 5m TEU annually, it can continue to add capacity in phases as needed through to 2030. More than 1.3m TEUs have been handled at the container terminal since it opened commercially in September 2012. About 95% of the traffic is currently gateway cargo but the authorities hope to develop transhipment business targeting upper Gulf and Indian Sub-continent. By 2030, as part of the drive to diversify the Abu Dhabi’s economy away from hydro carbon revenue, Khalifa Port will be able to handle 15m TEUs a year and together with the adjacent Kizad industrial zone, is expected to contribute 80% of the emirate’s non-oil GDP. In the near future, it will also become the very first port in the region with direct rail connection to the GCC Rail network.