‘Tis a season for power and cabling firms to expand in the MENA region.
There are incre asing moves toward chasing renewable sources of energy, such as wind and solar power, although the viability of these renewables in the long run has not been proven yet. So perhaps it’s still more realistic to pursue nuclear power and fossil-fuelled power generation at the moment, or at least in the short and medium terms.
Cable drums: There’s a growing requirement for cabling projects to support the region’s electricity substations
And what an opportune time this is for power and cabling companies to expand their operations across the MENA (Middle East and North Africa) region, where everybody seems to be building power plants. That’s just what ETA Star International is doing, with members of the Gulf Co-operation Council (GCC) on its mind particularly, plus Libya and Iraq.
“The power industry in the whole of GCC is increasing due to economic development,” says Mohammad Ali A Fadra, General Manager for Contracts and Business Development at ETA Star International. He stresses that the ideal power plants should be green, but the “nuclear power is still the most viable”, considering that renewable sources have yet to be fully developed.
Any attraction to doing business in the Gulf Arab states is understandable, as the GCC would require 160GW of power for its peak demand by 2020 from 78GW in 2009. This according to Abhay Bhargava, Industry Manager of Energy & Power Systems for the Middle East and South Asia at Frost & Sullivan, who placed the present GCC peak demand at 80GW.
A Dubai-based turnkey basis contractor for cabling, power and cement plants, ETA Star International is, indeed, gleaming brightly to cover more projects across the region. While Saudi Arabia is a top priority, the company, a member of the ETA Ascon Star Group, is busy doing, bidding and/or pre-qualifying to bid for projects in Libya and Iraq. It even has signed a $490-million (Dh1.8bn) deal to build a cement plant in the south-central African country of Angola.
Libya, which in 2006 announced a massive infrastructure development programme, has been requiring a lot of cabling projects to support its electricity substations and the estimated 450,000 housing units it would put up in the next decade. It was also reported to earmark $8 billion for water and sanitation projects, and renovate 2,000 kilometres of roads under its development plan for 2006-2011.
Focusing on the renovation and construction of roads, transportation systems, airports, schools, hospitals and water and sanitation projects, the programme likewise covers ambitious $9-billion railway systems. Take for instance, the 4,800 kilometres of rail network that would link Tunisia and Egypt, and a southern network linking the Libyan cities of Sirte and Sebha which could be extended to Chad and Niger.
In Iraq, ETA Star International is currently bidding for three power plants of between 600MW and 1000MW, Fadra says. The deal for a cement plant in Angola, meanwhile, is one of the single biggest EPC (engineering, procurement and construction) projects awarded to the ETA Ascon Star Group of Companies.
An test van for the heating, ventilating and air-conditioning projects
The second-largest petroleum and diamond producer in sub-Saharan Africa, Angola was a Portuguese overseas territory from the 16th century to 1975. It may now have an increasing need for materials for construction after a 27-year intense civil war that ended in 2002.
According to Rusty Barber, Head of the Iraq programme at the US Institute of Peace, as quoted by USA Today, reconstruction effort in Iraq is starting to show results in US-funded projects, such as sewage treatment, since the Americans invaded the country seven years ago “There has been some significant progress, but there’s a long way to go before Iraq can really be a stable, secure country that’s able to provide for its people’s basic needs,” he stressed, as quoted by USA Today on March 22.
The US had spent $44.6 billion in taxpayer funds to rebuild Iraq, half of which was used to train, equip and support Iraq’s military and police forces. The civil strife that broke in the country during the early years of post-invasion, problems of mismanagement and poor co-ordination among US agencies had slowed reconstruction projects, said Stuart Bowen, Special Inspector General for Iraq Reconstruction.
But he said the $21.3 billion that Washington spent on Iraqi security forces started to pay off this year, as attacks by insurgents on Iraqi and US forces were down 85% from two years earlier. “We have built an Iraqi security force which is capable of maintaining internal security in Iraq,” he said in the same USA Today article.
While such information may help some regional companies in their decision whether to pursue projects in Iraq, they obviously do not require any persuasion in expanding their businesses across the home base, with the special mention perhaps of Saudi Arabia and Qatar.
The Jebel Ali Power Plant, which ETA Star International delivered to Toshiba Plant System & Services Corporation and IHI UAE Co Ltd, in 2007
The ETA Star International, for instance, is putting up an office in Dammam, the capital of Saudi Arabia’s Eastern Province, within three months. “We are expanding there and to the other oil-producing countries,” Fadra says, adding that his company is now trying to be pre-qualified for cable link and substations projects in the biggest Gulf Arab economy. Since 2004, when the company started its foray into the power industry and related sectors, ETA Star International has made its mark in the GCC, particularly the UAE. It has major clients in government agencies, among them the Dubai Electricity & Water Authority (DEWA), Abu Dhabi Water & Electricity Authority (ADWEA), Qatar General Electricity & Water Corporation (KAHRAMAA) and Abu Dhabi Transmission & Despatch Company (TRANSCO), a subsidiary of ADWEA.
From the UAE, ETA Star International spread its business to Qatar, where it has been doing $225.2 million (Dh827m) worth of high-voltage (HV) and extra highvoltage (EHV) cabling projects in different areas across the country since 2008. The projects, which entail civil works, trenches excavation and cables installation, will be completed by end- 2010 or mid-2011, Fadra says.
The company is also trying to get qualified to bid for a cable-link project of 66kV-400kV, he adds, and is now bidding for another $54.5-million (Dh200m) project with KAHRAMAA which would start by next year. With 600 staff members working in its Doha offices that were set up two years ago, ETA Star International is confident that it could handle such projects in Qatar.
At its base in Dubai, the company has $544.5 million (Dh2bn) worth of ongoing projects, which are set for delivery by end-2010 and mid-2011. The amount covers 10 projects of over 200 kilometres of HV cable links between substations.
ETA Star International has recently finished 14 projects with DEWA and two others with ADWEA. With a combined value of $272.3 million (Dh1bn), these projects are now under a two-year warranty period, which covers materials and workmanship. It also has two ongoing projects with ADWEA worth $122.5 million (Dh450m), and is bidding for six other projects.
Mohammad Ali A Fadra
Fadra says his company always looks for ways to benefit its customers and add value to its services by sourcing the best cables needed for certain locations, and adhering to international standards in workmanship and cable testing. He cites the International Electrotechnical Commission (IEC), which is the international standards and conformity assessment body for all fields of electrotechnology, and the Institute of Electrical and Electronics Engineers (IEEE), a technical professional association that fosters innovation through standards development.
Promoting and pursuing sustainable development, or having progress without hurting the environment, is also on top of the company’s agenda. It recently signed a memorandum of understanding with The Energy Research Institute (TERI), of India, to explore areas of co-operation toward this move. The co-operation calls for, among other things, the assessment of buildings to get them accredited by LEED, an internationally recognised green building certification system, and reducing carbon footprint in the UAE.
Doing these things, Fadra says, helps his company arrive at “intelligent decisions” that benefit customers, and makes ETA Star International more attractive to a growing number of clients across borders.
