The Egyptian Electricity Holding Company (EEHC) decided to postpone the signing of contracts with AlNowais Investment Company for the construction of a coal-fired power station in the Oyoun Mousa area.
Sources from the ministry of electricity and renewable energy told Daily News Egypt that the surplus electricity production is the main reason for postponing the signing of the contracts. This is especially since reserves have reached 20,000MW per day and will rise to 22,000MW after the addition of energy from the Gulf of Suez wind farm and solar energy projects in Benban.
In addition, the sources said it is difficult to build a private coal port for the project at Oyoun Mousa because the water there is very shallow, necessitating the construction of the port at a greater depth within the water. Inevitably, this raises the total cost of the station.
Talks with the UAE company, AlNowais, began three years ago. The company officials held more than 50 meetings with officials of the EEHC for electricity to implement a coal-fired power plant at Oyoun Mousa.
The sources pointed out that the studies and paperwork of the project were transferred to EEHC for revision and no new decision was taken since then, noting that the project will not be signed off this year.
“The agreement on the purchase of energy produced from the project was finalized at 4.01 cents per kW/h leaving only the legal aspects of the contract that will be reviewed, but it may take longer,” the source said.
He added that the Belgian consultant, Tractebel, attended all the meetings and discussions, and was briefed on all the technical, financial, and legal aspects of the project after receiving them from the officials at the UAE company.
The sources added that the UAE company is sticking to the project and is waiting for the green light from the government to start working.
Furthermore, the sources also said that the strategy and mix of energy includes the implementation of coal-fired power plants. The EEHC has already taken steps in this context by negotiating with Shanghai Electric to implement a 6,000MW plant in Hamrawein, whose contracts are expected to be completed soon.
A public consultation conference was scheduled to be held in El-Quseer to discuss the Hamrawein coal power plant on Wednesday. However, it was delayed, and another date is yet to be set. No reasons were given for the delay.
The sources pointed out that the EEHC included coal-fired electricity projects in the ministry of electricity and renewable energy’s plan 2022-2027. It may be only a phase of the Hamrawein project.
The sources said that the lack of increased demand for energy will push the EEHC to postpone a number of projects that seek implementation in order to avoid the aggravation of financial burdens.