Hamarawein IPP coal project

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Hamarawein IPP coal project is a proposed 6,600-megawatt (MW) coal-fired power station near Hamarawein Port, Egypt.

Location

The map below shows Hamarawein Port, the approximate location where the project would be built, about 150 kilometers south of Gouna. Hamarawein port is currently used for phosphate exports. Project plans came after the government overturned its ban on coal imports for industry and power generation in April 2014.

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Background

In the wake of Egypt's 2011 revolution, persistent energy shortages and blackouts prompted Egypt’s government to consider overturning a long-standing ban on coal imports. In 2014, Egypt’s cabinet voted to allow coal imports for industrial use. The law was amended again in 2015 to allow coal-fired power plants.

In November 2016, the Ministry of Electricity said it will receive offers from five companies to establish a 6,000 MW coal-fueled power plant in Hamrawein by March 2017: Shanghai Electric, Dongfang Electric, General Electric, Mitsubishi-Hitachi, and Doosan. The companies had reportedly signed memorandums of understanding with the ministry in the past two years. In January 2017 the Egyptian Electricity Holding Company (EEHC) said it had received offers for a 6,000 MW coal plant from Shanghai Electric, Dongfang Electric, Mitsubishi-Hitachi, Sewedy-Marubeni coalition, Sumitomo, and the coalition of Apec-Orascom.

In January 2017 the Ministry of Energy informed the cabinet that the time frame for adding capacity in Hamarawein was being pushed back until the 2022-2027 economic plan. According to sources within the Ministry of Energy, Egypt currently has 4,000 MW of excess power, and that figure will rise to 8,000 MW with the completion of new plants in the New Administrative Capital, Borollos, and Beni Suef.

On May 1, 2017, the Ministry of Electricity said it had received three offers from unnamed American, Chinese, and Japanese companies for a plant of 6,000 MW costing US$10 billion. The Belgian consultancy office Tractebel was designated by the Ministry of Energy to evaluate the proposals.

In February 2018, it was reported that Shanghai Electric (SEC), Dong Fang (DFC) and Hassan Allam Construction (HAC) submitted the lowest bid of US$4.4bn with a Levelised Cost of Electricity (LCOE) of US$5.4c/kWh. The second lowest bid was submitted by GE (US$5.8bn) with a LCOE of US$7c/kWh and a consortium of Mitsubishi Hitachi Power System (MHPS), Orascom Construction (OC) and El Sewedy (PSP) submitted a US$7bn bid with a LCOE of US$4.5c/kWh. The bids are being evaluated. The project was described as a supercritical coal-fired power plant project scheduled to come onstream in 2023-2024.

In June 2018 Egyptian Electricity Holding Company announced that a consortium of China's Shanghai Electric and Dongfang Electric Cooperation, along with Egypt's Hassan Allam Construction, won the tender to build the project, with the lowest bid of US$4.4 billion. An MoU was signed in September 2018 for a 6 x 1100 MW coal plant.

In August 2018, it was reported the final contracts for the Hamrawein coal plant was expected to be signed in September 2018 during President Abdel Fatah al-Sisi’s visit to Beijing, China. The deal was signed on September 2, 2018 at the China-Egypt Business Forum in the Egyptian Embassy in Beijing. The Chinese Development Bank (CDB) has made an offer to fund the establishment of the coal-fired power station for US$3.7 billion.

In July 2019, Egypt’s Ministry of Electricity and Renewable Energy said it was set to hold a community consultation session to assess the environmental and social impacts of the proposed plant. According to Construction Review, "The land allocated for the implementation of the clean-coal plant has already been prepared, and all studies completed. In addition, all licenses and approvals required for the project have been issued. The community consultation session is therefore considered as the only step remaining before the actual work of the project commences."

Coal power in the strategic plan FY2018/2019 to 2029/2030

The long-term strategic plan that begins in FY 2018/2019 and ends in FY 2029/2030 includes US$135.258 billion for electric power, including US$38.6 billion for coal power. This includes:

• FY2019/2020: US$3.365 billion for coal out of US$10 billion total. In 2018/2019 $1.833 billion is budgeted for wind farms, US$229 million for solar PV, and US$3.662 for solar thermal power plants.
• FY 2021/2022: US$7.529 billion for coal power plants, US$484 billion for solar PV, and US$2.972 billion for solar thermal out of a total of US$12.781 billion.

Overall, during the period, 16,800 MW will be added from coal, 4,800 MW from nuclear, 4,650 MW from natural gas and oil, 9,350 from wind, 6,950 MW from solar thermal, and 9,020 from solar PV. The total capacity increase in the period is 51,738 MW.

Early bids

Shanghai Electric and Dongfang

On January 21, 2016, China's Shanghai Electric and Egyptian Electricity Holding Company entered into a conditional EPC (engineering, procurement, construction) contracting agreement for construction of the Hamrawien coal-fired power plant. Phase I contains four 660MW coal-fired power generation units and phase II contains two 1000MW coal-fired power generation units, or 4,640 MW total. Phase I is estimated at US$2.5 billion.

On 21 January 2016, China's Dongfang Electric Corporation entered into an EPC contract for an ultra-supercritical plant at Hamarawein with Egyptian Electricity Holding Company. The total installed capacity of the project would be 3,960MW, developed in two phases of 3×660MW each.

In January 2017 the Ministry of Electricity received offers from Shanghai Electric and Dongfang for a 6000 MW coal plant.

Apec-Orascom

In November 2014 Orascom Construction announced plans to commence studies to construct and develop a 2,000 to 3,000 MW coal-fired power plant in cooperation with UAE-based International Petroleum Investment Company (IPIC). The total value of the project has been placed at approximately US$2.5 billion to $3 billion, and Orascom said the plant would "utilize clean-coal technology that complies with EU standards for emission control." The estimated timeframe of the project is four years. Orascom Construction and IPIC aim to build the project near to Hamarawein port on the Red Sea coast. Orascom Construction is a cement and engineering firm owned by Egypt’s richest man, Nassef Sawiris.

In March 2015 Orascom said the plant may be 3,000-4,000MW, and that a plant of around 1,800-2,000MW could be built as part of a first phase. The company expects to achieve financial close for the first phase of the US$5 billion power plant it is building with IPIC by the end of Q1 2016.

In January 2017 the Ministry of Electricity received an offer from Orascom and Apec Coal of Australia for a 6000 MW coal plant.

Sewedy-Marubeni coalition

In January 2017 the Ministry of Electricity received an offer from Sewedy and Marubeni for a coal plant at Hamarawein. Marubeni described its role as the engineering, procurement, and construction (EPC) contractor for the plant, rather than the owner. Marubeni's response to question from the Business & Human Rights Resource Centre stated that the plant would use ultra-supercritical combustion technology.

Financing

In January 2016, it was reported the plant would be funded by the Industrial and Commercial Bank of China (ICBC), the Export and Import Bank of China (EXIM), and the Chinese Development Bank (CDB). The Egyptian Electricity Holding Company (EEHC) will repay the Chinese loans over 15 years with an allowance for facilitated payment.

In February 2017 the Industrial and Commercial Bank of China (ICBC) announced that it was to invest US$20 billion in Egypt over the next decade, including funding of a phosphate complex and a coal-fired power plant near Hamarawein port.

In June 2017, it was reported that nine banks have pledged to invest about US$1.5 billion of $10 billion total project cost. The banks are the Commercial International Bank (CIB), QNB Al-Ahli, the Arab African International Bank (AAIB), AlexBank, Ahli United Bank, Export Development Bank of Egypt (EDBE), Egyptian Gulf Bank, Societe Arab Internationale de Banque (SAIB), and Emirates NBD Egypt.

In March 2019, it was reported the Chinese Development Bank (CDB) had made an offer to fund the establishment of the power station for US$3.7 billion.

Project Details

• Sponsor: Egyptian Electricity Holding Company
• Developer: Shanghai Electric, Dongfang Electric Cooperation, Hassan Allam Construction
• Location: Hamarawein, North of El-Quseir City, Egypt
• Coordinates: 26.25, 34.2 (approximate)
• Status: Pre-permit development
• Gross capacity: 6,600 MW (Units 1-6: 1,100 MW)
• Type: Ultra-supercritical
• Start date:
• Coal Type:
• Coal Source:
• Source of financing: Chinese Development Bank

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