The Qatar Electricity and Water Company (QEWC), in collaboration with the Qatar General Electricity and Water Corporation (KAHRAMAA), announced plans for a new electricity generation project to boost the country’s power supply.
The project will see the construction of peak power units in the Ras Abu Fontas area, with a production capacity of 500 megawatts (MW), subject to a 5% variance.
The project is intended to meet the growing electricity demand of the State of Qatar, as the country continues to expand its infrastructure and industrial base.
According to a statement issued by QEWC, the company is currently in the process of evaluating technical and commercial offers for the project, which is expected to enter the final stages soon.
A comprehensive proposal is set to be presented to KAHRAMAA, Qatar’s state-owned electricity and water management authority, in the coming period.
The selection of a main contractor for the project is anticipated to follow the completion of this evaluation process.
The Ras Abu Fontas power plant project comes at a crucial time for Qatar, as the country experiences an ongoing increase in electricity consumption. With a population nearing three million and growing industrial activities, especially related to the liquefied natural gas (LNG) sector, reliable and scalable energy sources are critical for the nation’s economic resilience.
The new power generation capacity will provide essential peak-load support, which is required during periods of high electricity demand.
While the timeline for construction and completion is yet to be finalised, the project represents a strategic effort by Qatar to ensure energy security and stability.
Peak-load units are typically designed to operate during high-demand periods, offering additional electricity supply when the base-load power stations are operating at full capacity.
The announcement of this power project follows QEWC’s August release of its financial results for the first half of 2024, which revealed a challenging year for the company. QEWC reported a 12% drop in net profit, with earnings declining to QR 680 million in the first six months of 2024, compared to QR 769 million during the same period in 2023. The earnings per share also fell from QR 0.70 to QR 0.62 during the same period.
Revenues, on the other hand, saw a modest increase, with the company reporting QR 1,431 million for the first half of 2024, up from QR 1,379 million in the first half of 2023. However, operating profits dipped to QR 616 million, down from QR 642 million in the previous year.
The decline in profitability has been attributed to a variety of factors, including rising operational costs and maintenance expenses, which have weighed on the company’s bottom line. Despite the financial headwinds, QEWC remains a key player in Qatar’s energy landscape, contributing to the nation’s power and water security.
In September, QEWC held an extraordinary general assembly, during which shareholders approved a 25% interim cash dividend. This came amid efforts to strengthen the company’s financial position and reward shareholders in the face of declining profits. The dividend eligibility date was set for September 8, 2024, following the conclusion of the extraordinary general assembly meeting.
At the same meeting, QEWC shareholders also approved amendments to the company’s Articles of Association, granting the board of directors the authority to distribute interim dividends during the year, provided the company has sufficient distributable profits.
These changes align with guidelines set by the Qatar Financial Markets Authority and the provisions of the Commercial Companies Law.
QEWC has also taken steps toward restructuring its business operations. As of July 2024, the company assumed full management responsibility for Nebras Power, a subsidiary focusing on power projects outside of Qatar, through a services agreement. The reorganization is an important strategic shift for QEWC, as it consolidates its commercial, administrative, and technical activities under one umbrella, positioning itself for further expansion both domestically and internationally.
“This restructuring will allow us to optimise resources, harmonise our internal processes, and better position the company for future growth,” said QEWC Managing Director and CEO Mohammed Nasser Al Hajri at the time.
Under the guidance of HE Saad bin Sherida Al Kaabi, Minister of State for Energy Affairs and Chairman of QEWC, the company says it is committed to its long-term strategy of supporting the national electricity and water sectors.
QEWC’s leadership has placed a strong focus on enhancing efficiency and exploring new opportunities for growth, both within Qatar and in international markets.
