Middle East will import coal for power plants

Times:

They are countries so rich in oil and gas that they would never want for fuel to drive their booming economies and the lavish lifestyles of their rulers.

Now, however, in a role reversal that makes selling sand to Saudi Arabia look like a sensible business transaction, the oil-rich Gulf states are planning to import coal.

An acute shortage of natural gas has led to the city states of the United Arab Emirates seeking alternative fuels to keep the air cool, the lights on and the water running.

Abu Dhabi is working with Suez, the French utility company, on a nuclear power project but coal is emerging as the best quick fix to avert blackouts as the world’s biggest hydrocarbon exporters struggle to cope with high prices for oil and natural gas, infrastructure weakness and a development boom. Some of the world’s biggest oil exporters may soon find themselves reliant on imported fuel from a leading coal exporter, such as South Africa.

As a result, Taqa, Abu Dhabi’s national energy company, plans to take a half share in a proposed £500 million coal-fired power plant, while Dubai Electricity and Water Authority (DEWA) hopes to start work on a clean-coal project this year.

Oman Power and Water Procurement Company indicated in December that a planned 700-megawatt power and water desalination plant may need to be fuelled by coal instead of natural gas.

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The sudden gas shortage has caught the Gulf states by surprise at a time when demand for power and water desalination is increasing annually at double-digit percentage rates. Investment in infrastructure has lagged behind the region’s population expansion and construction boom. Anecdotes abound of apartment complexes left empty because there is not enough capacity in the local electricity grid.

According to Wood Mackenzie, the energy consultancy, the UAE’s demand for gas will double within a decade if power consumption continues to grow. Dubai’s peak power consumption rose by 15 per cent last year, according to DEWA’s statistics.

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Since the US is described as the Saudi Arabia of coal, it appears our fortunes may turn soon. That is if the Democrats will permit the coal to be mined. Bill Clinton set a huge reserve in the west off limits by making it a nature preserve. Democrats are also upset with mining in West Virginia. Now they are blocking coal plants in places like Texas. Go figure.