GCC grid contracts signed

18 November 2005 – ABB and Areva yesterday signed large contracts with the GCC Grid Interconnection Authority contracts for work on the project to link the power grids of six countries in the Gulf region.

ABB has won a $220m substation order while Areva T&D signed two contracts totalling $233.5m, to build the Middle East’s first high-voltage direct current (HVDC) station and a fully integrated grid automation solution.

The Gulf Grid is the biggest power transmission project to be announced anywhere in the world in 2005. “This order confirms both our market leadership and the quality of our technologies. We are proud to be contributing our cutting-edge substation technology to this project, boosting transmission capacity and improving the reliability of power grids in the Gulf,” said Peter Smits, head of ABB’s Power Technologies division.

It is ABB’s largest single order so far in 2005, and one of the largest
substation orders ever won by the company.

Under the first Areva T & D contract the company will deliver a back-to-back 1800 MW HVDC converter station. The station will convert the frequency between Saudi Arabia’s 380 kV 60 Hz transmission grid and the 400 kV 50 Hz backbone power network connecting Kuwait, Bahrain and Qatar. The station will enable the transmission of power between the two systems and will consist of three 600 MW converters including thyristor valves, 375 MVA converter transformers as well as 380 kV and 400 kV circuit breakers.

Under the second contract, Areva T & D will also design and build the GCC grid’s entire automation solution, simplifying and optimizing the integration between the different automation systems. It will construct a new control centre equipped with a SCADA and Energy Management System based on its e-terraplatformsoftware. The centre will guarantee the efficiency and safety of the power grid and will enable the recording and billing of energy transactions between the different countries.

Areva T & D will also develop a telecommunications infrastructure spread across approximately 800 km that will relay key substation information to the control centre via a fibre-optic high-speed network and backup digital power line carriers (PLC 5000).

The contracts are part of the first phase of a billion dollar project to develop a transmission grid interconnecting the Gulf Cooperation Council (GCC): Bahrain, Saudi Arabia, the United Arab Emirates, Qatar, Kuwait and Oman. The future electricity network will enable these nations to share their electricity reserves, improve the quality of power distribution to users and ensure a constant supply of electricity at all times. According to GCCIA the payback period for the investment of about $1 bn is less than four years.

The GCC Interconnection Authority (GCCIA), a joint stock company subscribed to by the member states, will sign the agreement in Dammam with 13 international companies. GCCIA has an authorized share capital of $1,100m (BD415m), divided into 1.1m shares of $1,000 (BD378) each.

The value of shares held by each country is: UAE $169.4m, Bahrain $99m, Saudi Arabia $347.6m, Oman $61.6m, Qatar $128.7m and Kuwait $293.7m.