With a power crunch looming, Qatar is studying the possibility of adding up to 5,400 megawatts (MW) of nuclear capacity between 2011 and 2036, according to the ‘Arabian Gulf Electricity Industry’ report released by Moody’s yesterday.
However, Moody’ stressed this option would be considered only if demand forecasts are high. The report said: “We note the implementation of these new technologies requires adequate infrastructure and manpower, which will need to be in place to ensure safe and efficient operations. Furthermore, a noticeable shift in the region’s fuel mix will not result for many years and is unlikely to contribute to immediate shortfalls.”
Qatar faces one of the most challenging expansion prospects in the region as the country will more than double its present installed capacity by 2015.
This is due to the many hydrocarbon-related activities, including the construction of mammoth energy projects.
"Furthermore, Qatar is becoming a leading exporter of liquefied natural gas (LNG) and is thus subject to long-term supply commitments that could limit its uses for domestic consumption,” said the report
Moody's, quoting from the Middle East Economic Digest (MEED), said up to $50bn could be spent in the GCC by 2015 in order to support an estimated increase in generation capacity of nearly 60,000 MW. Significant investments will also be needed to update transmission and distribution networks.
Qatar is expected to add 65,000 MW of additional capacity by 2015 at a projected cost of $5.5bn. Demand growth for electricity is pegged at 17 percent per annum, the highest in the region with Dubai close behind at 16 percent.
The ratings agency has noted the region is facing fuel supply shortages. “The Gulf fuel mix is characterised by a high percentage of gas use compared to the global average. Fuel in the Gulf is generally provided at fairly favourable conditions, although the future availability of inexpensive gas, which is used to produce most of the electricity, is a key issue."
With the majority of new plants to be built by 2015 expected to be gas-fired, current feedstock arrangements may not be sufficient to meet additional future demand, thus posing a significant challenge for utilities in the region.
The Pen
Follow us on our social media channels:
@ILQlive
@ILQlive
@ILoveQtr
ILoveQatar
