Kahramaa aiming to power ahead

Kahramaa is set to spend $3.5 billion this year, with around $2.1 billion of this, almost two thirds of the entire budget, going towards electricity infrastructure and electricity network development projects. Meanwhile, $357.3 million has been set aside for water infrastructure and network development projects.

Stepping up the funding

The remainder of the budget, just over $1 billion, will go towards operational costs and the acquisition of electricity and water from private generation companies. But possibly the most revealing statistic of all is that Kahramaa's entire budget for the current fiscal year is nearly five times as much as was deemed sufficient in 2003.

Just last week, according to The Peninsula, the firm, prior to its budget statement, declared that more than $2 billion would be put towards capital projects in 2007 as it seeks to expand its electricity network. This sum compares to a paltry $35.7 million in 2003. It is small wonder Ali Al Jomali, Acting Manager, Electricity Network Planning, described the step up as a 'quantum jump'.

Kahramaa has plans to commission no fewer than 31 major projects this year as the corporation looks to extend its electricity network by 113 per cent. The next financial year will see a further increase of 169 per cent and in 2008 alone around 40 new sub-stations should be set up. Meanwhile, the laying of over 2,000 kilometres of cables is well underway.

Trying to meet demand

But part of the answer as to why the firm has had to ratchet up its spending lies in the continually rising demand for power and water. It may be no co-incidence that just a few days before Kahramaa unveiled its biggest ever budget, it also confirmed that 2006 had seen a record 19 per cent spike in energy consumption, while water usage had also seen a 16 per cent increase.

The firm is, of course, committed to making sizeable investments in upgrading its networks as Qatar looks to drive forward its economic growth as its big ticket energy projects come on stream in the next decade, but there is no question the state's burgeoning population has already impacted significantly on power demands.

Delegates to the MEED conference on non-energy projects in Doha last week heard predictions that Qatar's population could reach at least 1.3 million inside the next fifteen years - that would be more than double the UN's estimate of the total population as recently as 2003.

Signed and sealed

With such a dramatic growth rate predicted, Kahramaa hasn't been slow to secure major contracts which will enhance its network. Just last month, Swiss firm ABB won a $450 million deal to boost Qatar's power grid, while in November, Siemens was awarded a $907 million contract to deliver 25 turnkey substations, expand 14 existing substations and modify ten more by February 2009.

But perhaps the most significant contract was secured just before the end of the year when Japan's Marubeni Corporation inked a deal with Qatar Petroleum and the Qatar Water and Electricity Company to set up the Mesaieed Power Company to develop the Mesaieed A-Power Project in Mesaieed Industrial City. The natural gas power plant will be one of the biggest in the GCC region and on completion will have a capacity of 2,000 mega watts - enough to power 600,000 homes.

Last April, Kahramaa's in-house magazine claimed that electricity production capacity in Qatar could reach 6,000 mega watts by 2010 after the completion of the GCC inter-connection. It would seem that Kahramaa is looking to do everything in its power to make that a reality.