Next step in Qatar's $15 billion infrastructure spending

A $1.6 billion package for electricity and water is just a sign of things to come.

The Qatar General Electricity and Water Corporation, or Kahramaa as it is known locally, held a press conference at the InterContinental hotel in Doha last week to outline its four-year plan to carry out major infrastructure projects in the electricity and water sector, with a total expenditure set at $1.6 billion for 2005-2009.

Vice-chairman Essa Shaheen Al Ghanem, announced that 55 new electricity stations and several projects to develop water distribution networks are to be undertaken by 2009. This will also involve an increase in the capacity of existing electricity sub-stations by 60%, he added.

The electricity sector accounts for the lion's share of the plan with a $1.1 billion budget of which $675 million has been allocated to ongoing projects and $432 million for projects under study. Meanwhile, the water sector picks up $424 million of which $310 million is for projects currently in progress, including the 88-kilometre Ras Laffan B water pipeline to areas such as Bani Hajjar, Gharafa, Duhail and the Salwa industrial zone.

But local contractors are preparing for much larger orders in Qatar this autumn. The Qatar Government is committed to a huge escalation of investment over the next few years with upwards of $100 billion in expenditure: $75 billion for oil and gas projects, $15 billion for infrastructure and $10 billion for tourism, leisure and cultural projects.

For such a tiny place this is an enormous scale of investment, bigger per capita even than what is going on in the UAE. Indeed, many Dubai businesses and banks are now looking at expansion into Qatar to take advantage of this massive flow of new projects; $1.6 billion for water and electricity is just a drop in this particular ocean.