Persian Gulf Project Stream Now More than $2 Trillion

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--As the Gulf region countries face the challenges and imperatives of social development and industrial diversification, a steady stream of project forecasts of 12% is being announced. The value of projects in the pipeline, planned and currently being executed now totals more than $2 trillion, according to Citi Mena construction projects tracker.

The Gulf region has seen a 12% year-over-year increase in projects. Saudi Arabia's projects are up 19% year-over-year, and the country maintains its position as the Gulf Cooperation Council's (GCC) largest market with a total of $790 billion in projects.

Projects in Kuwait in 2012 were up 16% to $206 billion, and Qatar saw a 6% increase to $228 billion. Oman was up 6% to $122 billion, but Bahrain slowed to $64 billion.

Running parallel to the overall project boom is the forecast that the Middle East and North African (MENA) countries are expected to invest up to $250 billion in expanding power generation capacity over the next five years to meet growing domestic demand.

Significant energy-related projects as part of the 200 announced and planned ventures that are valued between $100 million and $20 billion will be discussed at Power Gen in Doha, Qatar, in early February.

Arab Petroleum Investment Corporation (Apicorp) reports that the GCC countries, which control 40% of the world's recoverable oil resources, will add nearly half the expected additional power generation capacity in the region.

It estimated that the total capital invested in power generation in MENA during 2013-17 at $147.5 billion to produce 123,900 megawatts of power, with the balance put into water projects.

Apicorp said that the GCC is projected to record the highest power demand growth of about 8.5% in the region in the medium-term.

In the Mashreq region--Egypt, Iraq, Jordan, Lebanon and Syria--growth is forecast at 7.6% and 7.2% in other Arab states. Demand growth in Iran is at 7% and 6.5% in the Maghreb, which covers Algeria, Libya, Mauritania, Morocco and Tunisia.

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