Egypt is close to signing contracts for a 2 GW electricity transmission network that will link Egypt’s electricity grid to Saudi Arabia, Electricity Minister Mohamed Shaker told eXtra News last Wednesday.

Wait a second: This is 1 GW less than was previously expected. Shaker said back in 2018 that the connection would have a 3 GW transmission capacity.

Egypt will fund about 40% of the project, while Saudi Arabia will pay for the remaining 60%, MEED writes. The USD 1.6 bn project is looking to connect both countries’ grids with 900 km of overhead transmission cables. The project is expected to go live in 2023, after being delayed from an original 2021 launch date due to Saudi Arabia’s Neom project.

Eight companies have so far made bids for the construction of the project in a tender that went live earlier this month, MEED reports. Saudi Arabi’s Alfanar has so far submitted the highest bid at USD 624.8 mn, while South Korea's Hyundai Engineering and Construction presented the lowest bid of USD 446.8 mn.

Two consortiums have submitted proposals in early May to design and build four USD 1 bn substations across both countries as part of the project, the business intelligence wire adds. A Chinese-led consortium, as well as a team comprising Hitachi, Orascom and Saudi Services for Electromechanic Works (SSEM) have so far bid for the substations contract. The project was originally supposed to go live last year but was pushed back to 2023 due to Saudi Arabia’s USD 500 bn futuristic city project, Neom. The cable routes extend 25 km across the sea bed.

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IN OTHER ENERGY NEWS-

Egypt and Cyprus have agreed to begin studies that would pave the way for Cypriot gas to be sent to Egypt for re-export, the Cypriot press reported on Thursday. A meeting between the Egyptian Oil Ministry and the Cyprus Hydrocarbons Company discussed ways to improve the design of the pipeline that would run from Cyprus’ Aphrodite gas field to the Damietta and Idku LNG plants. Officials from both countries have reportedly been in “extensive discussions” over the pipeline project since early this month. Two more meetings will take place before the end of the year.

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Misr Methanol will within days sign a land use contract to build a new USD 2.5 bn methanol plant with the General Authority for the Suez Canal Economic Zone (SCZone), SCZone Vice President Mohamed Shabaan said on the sidelines of last week’s Port Said Investment Forum, according to Al Borsa. The plant, which will be established on the plot in the SCZone’s Ain Sokhna site, aims to produce 1 mn tonnes of methanol and 400k tons of ammonia annually, a portion of which will be exported.

This is the first project to be established by Misr Methanol and Petrochemicals, a state-owned petrochemicals company formed by the Oil Ministry in August and jointly owned by Abu Qir Fertilizers, Helwan Fertilizers, and Al Ahly Capital Holding. An Oil Ministry statement at the time of the company’s founding said that around USD 1.6 bn would be invested in the plant’s first phase. Misr Methanol will compete for market share with the Canadian-Egyptian firm Methanex, which for a decade has been Egypt’s only methanol producer.