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Kuwait: a solar thermal market worth entering?

Polaris solar PV net news: Kuwait national renewable energy plans show that solar thermal power will be in Kuwait occupies an important position in the energy mix of the future, but now also started slowly, Kuwait’s solar thermal power development will be able to speed up development?

Kuwait solar thermal project development process is much slower than we expected. The major natural gas importer and Qatar gas and shell signed a gas contract perennial, while also looking at Iran and the United States signed a similar natural gas purchase contracts, which seems to mean that Kuwait has stopped the pace of development of renewable energy.

Some new industries

Kuwait currently has at least three solar thermal projects in the planning and development of projects, including two currently being advanced. Progress fastest Shagaya light when an installed capacity of 50MW thermal power station, in April this year, the project will be implemented by Spain Cobra company and Kuwait UGETCO company EPC share the project. Shagaya 2GW of installed solar thermal power plants by 2030 Planning Shagaya renewable energy park part of the period apart from a 50MW solar-thermal power station will be constructed, but also includes a 10MW solar plant and a 10MW of wind farms, with a total generation capacity of 70MW.

Chart: Kuwait oil-rich

By Shagaya renewable energy park virtual tour software, we can see that after the completion of the Park’s future looks like. May be considering the Kuwait Scientific Research Institute, a research and Development Department is also located in the Park, as well as prepare for future size increase, the whole Park location range is very large.

In fact, Shagaya solar-thermal power project was proposed by the Hewitt Research Institute renewable energy development plan initial planning of third order of the first project, Kuwait Institute of science’s goal is that by 2030 the installed capacity of solar power a renewable energy park to 2000MW. According to MEED reported that the Park will be built to include installed capacity for solar-thermal power 1150MW systems and photovoltaic power generation system of 720MW, is likely to invite tenders in the form of an independent power plant.

In addition, size 280MW Abdaliyah solar will include gas-fired combined cycle power station installed capacity of 60MW of the trough solar thermal power generation systems, currently the project seemed to be advancing. Bidding requirements in the second quarter of this year has been released, tender intent the deadline for application is July 23, 2014. Next step will invite the eligible tenderers and by the end of bidding companies participated in the bidding.

Abdaliyah project with BOT construction model of cooperation from Kuwait for construction engineering corporation, Germany Federal Institute of physics and technology and the Kuwait national water and electricity company, in cooperation regulation. Kuwait national water and electricity company and Kuwait BOT Engineering Corporation signed a 25-year agreement, while Kuwait national water and electricity company has signed a power purchase contract with the plant.

What’s interesting is, Germany the Federal Institute of physics and technology being considered for Al-Abdaliyah the joint development of the two countries before the end of the biggest project the possibility of issuing shares. According to Kuwait Finance Company KFH published reports, will be determined by the selected bidder company was formed, as well as items sold 60% shares in the company will be open to both domestic and foreign investors.

Photothermal EOR era is coming

Also, using solar power steering oil light EOR technology has gradually developed over the past few years. Internationally renowned solar thermal GlassPoint EOR technology providers last March in Kuwait has set up a new company and enter Kuwait photothermal EOR market, while GlassPoint appointment of Kuwait Petroleum Company’s Office AbdulHussainShehab, Vice Chairman of the new company.

Shehab refers to April 2014 OPEC announcement said: “most conducive to the development of solar-thermal where EOR is located in Kuwait Northern stores a lot of heavy oil. In fact we already know this fact, for many years we have been using steam injection to conduct oil exploration. With the recent progress of solar thermal technology, we can use the light and heat to produce steam. ”

From United States, California’s solar thermal developer eSolar company has been looking for opportunities in oil-rich Gulf region. The company’s solar thermal technologies is tower technology, can also be applied to EOR, desalination of sea water and some industrial heat market sector.

ESolar CEOJohnVanScoter told reporters: “We recently came to Kuwait is looking for local partners, and to set up a consortium for the Kuwait future solar-thermal power or solar-thermal project out to bid, we believe that this idea will be at the end of the year or early next year to implement. ”

VanScoter introduction: “our Tower system uses a modular design, construction is very convenient and does not require any concrete foundations or heavy equipment. Solely with hand tools to complete the construction of the project. You can dismantle it and move it to the location you need, and then rebuild, to implement the system of freshmen. With this design, this system will enable investors throughout the operational life of the system, having obtained a higher rate of return on investments. ”

As he says, photothermal EOR applications, solar thermal systems in normal life more often than a longer oil drilling services, then move the solar thermal system to other possibilities of recovery points is necessary. VanScoter said: “it is hard to believe a photothermal EOR project in your solar thermal system needs to run 30 years ago, typically a photothermal EOR project at run time only for the 5-7. ”

Kuwait many of the hot and the Neutral region of Northern flooding annually to burn off a lot of crude oil or natural gas to produce steam, which produce steam to steam can use solar thermal technology alternative and lower cost. For example, the Kuwait oil company’s production base is located in the northern part of the production of oil can be accounted for 24% of the company’s oil output, now they are making a large heavy oil recovery plans, plans to base oil production increased to 43% per cent of oil production in the North. For the planned Kuwait oil company, is expected to cost $ 5.3 billion over the next 5 years.

GlassPoint CEORodMacGregor said: “Kuwait photothermal EOR technology being developed for global solar company providing a large market opportunity using photothermal techniques to produce steam can meet Kuwait most need a steam-driven oil production projects. This will save a lot of precious fossil fuels such as natural gas and make them more economic value in place. ”

The investment environment

Just like most of its neighbours, Kuwait’s solar industry is in its infancy, development also faces great challenges. Also, business logic and the West of the country are also very different. VanScoter which stressed: “in the Kuwait market’s biggest challenge is to find the right partner, how to play the home advantage partner to provide the most valuable help. In Kuwait without a local partner business will be difficult to continue. Secondly, Kuwait many projects must follow special rules and regulations to operate. For example, after 5 years in order to transfer ownership, unlike most other countries, this is not the same. This provision means that cooperation with local enterprises to form a Union is more difficult, because your local partners have 5 years to get his benefits. This system completely changes the way the returns item. ”

Worth noting is that in Kuwait that all foreign companies and consortia must have a local agent to be eligible to participate in project bidding.

In addition, Kuwait local manufacturers also have preferential price advantages, Kuwait allows domestic producers to own when commodity prices can be higher than the comparable prices of foreign 10%. Companies belonging to the Gulf Cooperation Council Member States enjoy similar 5% pricing discount. Unless the pricing more than foreign products under the 10%, there is still no Kuwait local companies can take part in the competition, will consider the company’s products abroad. However, this incentive applies only to Kuwait local companies, the project contractor is not entitled to.

This means that the project developers and contractors are encouraged to use potentially of locally manufactured products, despite Kuwait’s laws in the localization rate of the project has no special requirements.

VanScoter commented: “all in all, I think that Kuwait has relative to other countries more favourable business environment. We in Kuwait saw a lot in the field of power and non-power market opportunity, we look forward to more over the next few years to participate in the commercialization of local diversity projects. ”

Original title: Kuwait: a solar thermal market worth entering?

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