Political condition:
The government of Saudi is one of the most highlighted and monarch ruled nation in the world, named after the most influential family in the region Al-Saud family. The country operates its governmental issues through the council by appointed ministers and the consultative council. The King of Saudi Arabia carries the responsibility for being the head of state and the head of government. The law structure and the jurisdiction practices are followed according to the established rules and values from the native religion Islam. Due to the monarch characteristic of the country, no political parties exist in the country to challenge the throne of the King. Building political parties, labor unions and other associations is banned in the country with the royal family members of the ruling Al-Sauds command the major governmental positions such as in ministries. The singularly operating pressure group named Ansar Al Marah practices their plans for women rights with several other gas producing companies and religious groups. Except for several extremist threats, the country boasts a peaceful and stable place. (Mongbay.com), (BBC Saudi Arab Country Profile, 2010) and (Federal Research Division, 2004)
Economic Condition
The country is enriched with this natural resource and has 20% of the world's total oil reserves. This major asset of the country was discovered by USA in 1930 and commercialized production started after World War II.
According to the latest stats available, the oil production and oil exports amount around 10.78 million barrel/day (2008) and 8.728 million barrel/day (2007) respectively, maintaining its position as being the largest producer and exporter of oil. The total reserves are accumulated to be about 266.7 billion barrels, according to the latest research in 2009. The oil exports strengthen their GDP significantly which is last reported to be $600.4 billion with a growth rate of 6% and GDP per capita as $20,300. The recent inflation rate on consumer price is reported to be 5% and central bank discount rate is 2.5%. Their exports exceed imports amounting at a total of $180.5 billion and imports being of $86.61 billion. They are facing a budget surplus caused by their revenues which are evaluated to be $167.7 billion and expenditures are $164.3 billion. They developed their industry on various categories including "crude oil production, petroleum refining, petrochemicals, ammonia, industrial gases, sodium hydroxide, cement, fertilizer, plastics, metals, commercial ship repair, commercial aircraft repair, and construction." (Mongbay.com) and (Background Note: Saudi Arabia, 2010)
Social Variables
Saudi Arab's nationality is known to be Saudi(s) or Saudi Arabian and Arabic is the national language. Muslims make a rather notable 100 % of the population with the ethnic split comprising of 90% Arabians and 10% of Afro-Asian community. The workforce is comprised of various proportions of Egyptians, Jordanians, Pakistanis, Bahrainis, Yemenis and Indians. Education has seen crucial boost since 1970 and an impressive increase have been seen in female student segment (Federal Research Division, 2004). The cultural atmosphere has a reserved and conservative perspective with strict implementation of Islamic laws. Both the genders have been prohibited to work together and go to any public events. (Background Note: Saudi Arabia, 2010)
Energy Sector:
Saudi Arab produces a huge amount of electricity hourly; 179.1 billion kw/h and from this total amount the consumed is 165.1kmw/h. This level of production of electricity enables them to be self-sufficient in the sector and do not import any. Saudi Arab has invested around $79 billion in their private sector to develop it and has received remarkable response. The major source for electricity production is the "fossil fuel" the source abundantly available in the country, with 100% as its proportion in the other forms of electricity being produced. The continuous stream of investments is an indicator for future progress.
Currently the projects being undertaken include;
Petrochemical Projects amounting at US$90 billion, US$90 billion worth of Power Generation projects, Water Desalination Plans: US$88 billion and Natural Gas-Related Projects with the total investment of US$50 billion. This current scenario presents a very lucrative standing g of Saudi Arab in the electricity and energy sector to pursue developing and nation-prospering initiatives.
IPP Policies:
As of now Saudi Arab has a singular body, vertically integrated producing electricity for the entire country, the Saudi Electric Company (SEC). SEC owns most of the power generation, transmission and distribution plants. In addition to that, numerous other Independent Power Products and Independent Water Power Products are also operating. But they also supply electricity to SEC for specified loads. Some other corporate and large entity consumers produce their individual electricity to feed their respective loads. Electricity and Co-Generation Regulation Authority (ECRA), another Saudi Government owned body, produces electricity on Licenses. It recently developed a restructuring plan for the electricity sector of the government owned bodies to invite private investors and IPPs to set up their operations. (ERRA, 2008)
The supreme Economic Council of Saudi Arab passed the resolution in July 2002 which allows the private sector to participate in the development of Independent water and power plants. Their main objective is to attract the private investment for the energy generation projects. The government policies are welcoming the independent power plant units in the state.
Investment opportunities in Energy Sector:
Saudi Arab has been exploring various investment opportunities in the energy and energy-related sectors. These include:
• Crude Oil Refining
• Petrochemicals
• Power and Water
(Mongbay.com) and (Background Note: Saudi Arabia, 2010)
Saudi Arabia has had three power stations before its recent addition, the Shuaibah Power Plant. Shuaibah is Saudi Arabia's largest independent water and power project (IWPP) and world's third largest water desalination plant. Its commercial operation started March this year, 2010. The two major companies, Siemens Energy and Doosan Heavy Industry and Construction Company Ltd., with a few smaller ones collaborated in a consortium for the manufacturing and operations of the plant for the Shuaibah Water and Electricity Company (Press Release, 2010). Other developers like Hyundai Heavy Industries Co. Ltd. And Alstom Power (English.Hhi.Co.Kr), a Belgium based company (WWP-Business opportunitiesin Africa and the Middle East, 2001), has also contracted with the SWEC to work on various units of the plant. Arabian Bemco Contracting Co. Ltd. is another industrial developer firm which has worked in Saudi Arabia's Ryadh power plant (Arabianbemco.com).
All these companies present Descon with a significant competition for entering in Saudi market with the most threat from Doosan which has been making HRSGs since 1990 and have acquired remarkable experience. Furthermore, Doosan has 30% world's market share in HRSGs category (Doosan Newsletter no. 146, 2006).
SEC announced its decision to invest SR 21 billion in 3 new IPPs with a plan to build a capacity for 5,200 MW by year 2015. But it has been foreseen that attracting bids has become a challenge as the suppliers and developers are loaded with numerous projects. This presents a great opportunity for Descon to initiate contracts and transactions to gain entrance in upcoming projects. (Saudi Arabia - Lack of Equipment for Power Plants, 2007)
SEC invites private sector investors to invest in IWPP and IPP initiatives with 60% equity and the rest owned by the SEC and private investment funds (PIF). The estimated increase in the current consumption demand for electricity and power would increase drastically with needs to build more or extend the existing power plants in Saudi Arabia (Langdon D., 2008). Saudi Arabia's Ministry of Electricity and Water is aiming $80 billion investment in power projects in upcoming 10 years (Arabic Knowledge@Wharton, 2010). This adds to the potential in Saudi market for Descon.
The Saudi gas rates are highly subsidized which restricts many investors to gamble on their investment and the authorities are reluctant to restructure the system.
UAE
Political Conditions:
The UAE is a "constitutional federation" of 7 absolute monarch states, namely Abu Dhabi, Ajman, Fujairah, Sharjah, Dubai,Ras al-khaimah and Umm al-Qaiwain which came into existence on the an agreed upon consolidation between these emirates. With this unique settlement, the emirates live upon an enviable stable nation. The political and governmental ruling system is of federal, presidential and elective monarchy. Each emirate practices its extensive autonomy and the pool of revenues generated by all the seven states is then stored, evaluated and distributed from UAE central budget. A Federal Supreme Council has been established with the heads of all the seven emirates which decide upon the president and the vice president according to their dynastic positions and their authority in a system of tribal agreement. They promote liberal laws in the nation unlike other Monarch states such as Saudi Arab. The legal system of UAE is designed around two angles, Sharia and Civil Courts. Currently Sheikh Khalifa bin Zayed Al Nahyan, Ruler of Abu Dhabi is the President and Vice-President and Prime Minister is Sheikh Mohammed bin Rashid Al Maktoum, Ruler of Dubai.
(UAE Government, UAEinteract.com), (Helen Zielger and Associates)
Economic Conditions:
Ranked seven amongst the top oil reserves holder by Oil and Gas Journal January 2009, with 97.8 billion barrels UAE enjoys a prosperous position in the world and is a significant member of OPEC. Its natural gas reserves amount to 214 trillion cubic feet leveling it at sixth with respect to gas reserves. GDP for UAE stands at $270 billion with an 8.5% growth rate. It is 52nd among the top ranked GDP Purchase Power Parity with $200.4 billion and GDP per capita at $41,800. Service sector contributes about 50.2% in the GDP where 78% of labor is concentrated. Their exports outweigh the imports with exports at $174 billion and imports of $ 141 billion. Crude oil owns 45% of the total UAE exports. According to the latest available facts, the inflation is 1.5%. The budget revenues and expenses are reported to be $ 54.05 billion and 54.68 billion respectively. (The World Factbook, 2010)
Power Sector:
The UAE economy is growing consistently with increasing the electricity requirement and demand for the Emirates. According to the statistics available from 2007, electricity production of the Emirates is 71.54 billion kWh with their approximate consumption at 65.98 billion kWh. The business monitor international (BMI) projected 5.77% regional power to be accounted for by UAE. The downfall UAE energy sector seemed to be facing has another dimension that is of potential to grow.
The UAE government plans to 50% expand the existing 10 gigawatt of existing installed capacity in coming years. The investment of $8 billion needs to be done in the following 6-8 years in account of improving the energy sector for the Emirates. Dubai Electricity and Water Authority's initiative to install 1.3 GW power plant and desalination system will fulfill a certain amount of the need. (Background Note: United Arab Emirates)
Power Generation:
Thermal power generation will be the most frequently used way to produce electricity and many power plants will be fueled with natural gas, thus increasing the gas demand and requirement. The increase is supported by these figures; 57.6 twh to 83.1 twh and it represents 97.7% of total power generation by 2011. The oil fueled power plants will decrease and the growth in oil usage will grow steadily. Coal usage and hydro electricity has also been under scrutiny in UAE. But coal is considered a dead lead as the resource is not sufficiently available, whereas, hydroelectricity has a great potential. BMI forecast presents the cost of power generation to be US$ 3.1 billion to US$ 3.9 billion between 2007 and 2011. (Background Note: United Arab Emirates)
Investment Opportunities in Power Plants:
Taweelah A1 Power and Desalination Plant in Abu Dhabi, a CCGT (Combined cycle gas turbine) plant, was commissioned in 2003 and was completed in 2006. The authorities are further planned the expansion of the project in 2009 in order to meet the increasing needs of the country. The plan was installed with HRSGs and some older equipment was also replaced with the latest HRSGs in proceeding years. Ruwais Cogeneration and Desalination Plant owned by Abu Dhabi's is another plant completed in 2000 with almost the same suppliers as the Tawelah's.
ABB Switzerland, DEKOMTE , International Energy Resources, KE-Burgmann , Rotring Engineering ,Young & Franklin are the featured suppliers for equipment.
Production of six new power plant projects has been revealed by the Sharjah Electricity and Water Authority (SEWA) to overcome power shortages in summer, reported by Khaleej Times. "Two 3kv-capacity plants in Al Majjaz and Abu Shagara will operate starting 
June 1 while plants in Al Mirgab, Al Nouf, Al Mahatta and the Khaled sea port will begin operation from August."( Sharjah sets up 6 power plants, 2009)
"A contract to build Dh7 billion, 500-megawatt hydrogen power plant will be awarded this year, with construction starting in the fourth quarter of 2011 and completion expected by 2014. Will be build around 250 km west of Abu Dhabi" (UAE Interact, 2010)
On 2 July 2003, International Power (IP) declared its financing of upcoming acquisition and expansion of the Umm Al Nar power and water desalination plant as part of Abu Dhabi's power and water privatizing. The consortium by IP included Tokyo Electric Power Company (TEPCO) and Mitsui acquiring a 40% equity interest in the project from the Abu Dhabi Water and Electricity Authority (ADWEA) to form a new joint venture, the Arabian Power Company (APC). The remaining 60% of APC is owned by a holding company, itself wholly owned by ADWEA. (Umm Al Nar Desalination Plant, Abu Dhabi, United Arab Emirates)
Abu Dhabi Water and Electricity Authority (Adwea) is communicating its intention to finance a 1,600 MW power plant at Shuweihat 3 with financial assistance from banks. The plant has received 14 bids as yet, Adwea Director of Privatisation Abdullah Al Nuaimi said.
Adwea reported of acquiring around US$2.1 billion for the Shweihat 3 plant (UAE Interact, 2010)
Dubai's government utility initiated its efforts to order its first private power plant. Dubai Electricity and Water Authority (Dewa) is planning with advisors upon construction and development of its IPP, Hassyan power plant. The IWPP model will be implemented in Dubai for the first time because its power and water sector had been under UAE, Government owned. Dewa Chief Executive Saeed Mohammed Al Tayer said, they tendered for the project thrice and were unable to get sufficient bids. This time DEWA plans to introduce a bond in 2010's second quarter for the capital raising purpose. (The Peninsula, 2010)
All these projects presents various areas as opportunity for Descon to transact with UAE power plants, in both the production and expansion of the plants.
Kuwait
Political Conditions:
Kuwait is a "constitutional hereditary emirate" with no political parties to challenge instead the throne is transferred to the hereditary heir. Amir and Prime Minister are the head of state and head of government respectively. The council of ministries, the cabinet, is appointed by the approval of Amir and Prime Minister. The constitution for the country was approved and promulgated in 1962, a year after its independence. Executive branch elections have never occurred as the Amir is hereditary. Elections for National Assembly and Municipal Council were held in 2009. (Background Note: Kuwait, 2010) and (The World Factbook, 2010)
The law is implemented through civil courts and in personal matters the Sharia. The country is supported by strict law enforcement and the civilians feel secure under this system. The government owned regulations make it impossible for any prospective privatization. The technological advancement has been incredible yet under the government's Ministry of energy and power.
Economical Conditions:
Geographically small but a wealthy country, Kuwait is one of the countries with high revenues earned by remarkable exports of crude oil and low direct investment and opportune economic conditions in the Middle East. According to 2009's available data of figures, GDP (PPP) is $148.7 billion, GDP per capita (PPP) $55,800 , inflation rate 9% and central bank discount rate 3.75% with a remarkable growth of 9% and less than 1% foreign direct investment of its GDP. The oil reserves of 140 billion barrels account for 9% of worlds total oil reserves.(Background Note: Kuwait, 2010) and (The World Factbook, 2010)
Power Sector:
Since 1999 Kuwait has raised its electricity generation capacity from 6,898 MW to 9,300 MW in 2005. (APS Review Downstream Trends, 2005). The BMI forecasted that by 2013 Kuwait would produce 4.2% of the entire Middle Eastern electricity. The report shows an increase 1,566TWh by 2013 in the generation capacity. Below is the statement by BMI:
"MEA thermal power generation in 2008 is estimated by BMI at 1,135TWh, accounting for 94.6% of the total electricity supplied in the region. Our forecast for 2013 is 1,460TWh, implying 38.3% growth that reduces slightly the market share of thermal generation to 93.2%"
The potential in the power generation is evident with projects like at Al-Zour South and Al-Zour north. According to a projected figure, electricity generation capacity will see a hike of 63.5%, during 2008-2018. (APS Review Downstream Trends, 2005).
Government Policies:
The country faces a barrier from the government for prospective projects as privatization is not allowed and the government can only oversee certain dealings and productions. But, government itself is active to perform the most to support the energy generation subject with its self-owned power plants.
Investment opportunities:
There lies a significant opportunity for the Kuwaiti Government to explore the prosperity through investment pools by private investors and deregulate the energy sector to enhance the operations. The current system is working notably well, but the the opportunity still lies there unperturbed. It should also be given a chance.
HPI LLC turbine control and monitoring services in collaboration with Alghanim International and S&W Energy solutions, built two important power plants for Kuwait, Shwaikh power plant and Subiya Peak Power Plant (HPI-LLC.Com). Alghanim transacted with GE to acquire turbines for the Shwaikh Power Plant (Press Release, 2007). The Subiya Power Plant is undergoing the process of privatization as announced by the government of Kuwait (A Saleh and agencies, 2010).
Kuwait entered into a contract with General Electric, US, and Hyundai Heavy Industries, South Korea, to build its new power plant in nearly two decades. The plant is expected to be operational in 2011 with an estimated cost of US $2.66 billion. Kuwait further plans to double its power generation and has plans underway to be followed (Arab Times, 2009), (Chris Clinton, 2009).
Kuwait successfully implanted its Az Zour Power Plant with the expert services and equipments from Siemens AG in 2004.
Descon can experiment in Kuwaiti market through the Subiya expansion plans and wait for future projects.
Turkey
Political conditions:
Turkey has had its share of fights between the military and the Islamists with the military taking its grounds. It has been through the fundamental Islamic rule, the Kurdish minority group, the debate between the secular elite and the traditional Muslims to the current modern secular system with parliamentary representatives of multi party system. (Government), (Wikipedia)
Economic Conditions:
The economy of Turkey has several elements generating revenue for the country including commerce and agriculture, which still has 25% of labor of the country. Services sector has grown to an outstanding 64.7% of the total GDP. It has been growing the private sector to develop the country in competition to the rest of the world and a huge potential exists there. Latest GDP has been accounted at $608 billion in 2009 along with the GDP per capita $11,200 in 2009, lowered from 12,100 in 2008. In 2009, the inflation rate was given to be 6.5%.
The country's exports amount to $111.1 billion (2009 est.) with a mix of textiles and apparel, industrial machinery, iron and steel, electronics, petroleum products, and motor vehicles. Chief export partners for Turkey are Germany, UK, UAE, Italy, France and Russia. The imports exceed the export at $134.2 billion (2009 est.). the product and services that turkey imports are petroleum, machinery, motor vehicles, electronics, iron, steel, plastics precious metals and the Major partners are Germany, U.S., Italy, France, Russia, Italy, Japan, Netherlands, U.K.
(The World Factbook), (Background Notes: Turkey)
Power Sector:
The energy requirements for the country are greater than the average rate of GNP. Though the installed capacity for the electricity generation has been increased up to40, 000 MW in 2008, it still has the prospects to be looked into the sector. 68% of the energy is being generated by fossil fuels and the rest 32% is from hydro, geothermal and wind. The official figures reported a decrease in demand but later after the projections were reevaluated, they showed a 4.5% increase. Turkey invited private investors to invest in electricity distribution companies and next it will be entering into privatizing contracts for generation of energy.
In 2004, Turkey reported its electricity generating capacity to be of 35.6 Gig watts (GW) presenting an increase of 36% from year 2000. It generated 143 billion kilowatt-hours (Bkwh) of electricity in 2004 and the consumption was reported to be 133 Bkwh.
Investment opportunities:
Turkey has a number of thermal power plants operating in the country with nuclear and CCGT power plants as well.
"The 1,400MW CCGT Bursa plant was built by a consortium led by Mitsubishi Corporation that included the Itochu Corporation and ENKA, a Turkish-based conglomerate." [1] It is the largest turnkey project in Turkey and was completed in 2001. The plant is equipped with HRSGs and gas and steam turbine generators. (Bursa CCGT Power Plant, Turkey)
The original Akkuyu Nuclear Power Plant announced in 1999 got cancelled in 2000. The project was reopened and the first unit was supposed to be operational in 2006. The government now plans to extend the project into 3 units and build it by 2015 with additional capacity. ( Akkuyu Nuclear Power Plant, Turkey)
Morocco
Political Conditions:
The country located in the North-west corner of Africa with a constitutional monarchy system. An amendment of the 1992 legislature was implemented to formulate bicameral legislature. Morocco is regionally distributed in 3 categories: the fertile northern coastal plain, the rich plateaus and lowlands between the Atlas Mountains. At east side of Morocco the desert of Sahara spreads out which is undecided as of yet if the sandy terrain is a part of Morocco. (The World Factbook, 2010)
Economic Conditions:
Since the economic policies by the King Mohammed VI are being implemented and practiced, the economy has stabilized with inflation decreased and enhanced activities in financial sector. Before that the country practiced privatizing but was unable to acquire the most out of it. According to latest numbers, Morocco is ranked the 5th in the African countries in terms of GDP PPP. Its diversified operations across the country in setting up industries has lent significantly to their economy.
GDP (Purchasing power parity) is given to be $ 146.7 billion (2009). GDP is reported as $ 90.78 billion (2009). GDP per capita is $ 4600 (2009). Revenues for 2009 are recorded as $ 22.9 billion and expenses had been $ 23.86 billion with an impressive inflation rate of 2 % (2009). (The World Factbook, 2010)
Power Structure:
As projected in a 2008 estimate, electricity production in Morocco was 19.78 Bkwh, whereas, the consumption was reported to be 20.78 Bkwh and the country has to import 3.429 Bkwh of electricity. l'Office National de l'Electricité (ONE) generates distributes and transmit the electricity to the entire country. No private companies are present in the energy sector.
Investment Opportunity:
A significant opportunity exists in Morocco as they are dependent upon the imports while the demand is increasing by 7%. The market for wind power and hydropower generation is open to be explored.
The Jorf Lasfar Coal-Fired Power Plant was expanded with two additional coal-fired units and satisfies 65% of the base- load energy requirements of the nation and one third of the electricity supply. The $1.5 billion plant is the largest unique IPP in Africa or the Middle East.
"Younes Kamal Maamar, General Manager of Office National de l'Etlectricite (ONE), Morocco's primary utility company, signed the $189 million project financing agreement in Jeddah following approval of the project last month by the IDB Executive Board, reported Saudi state news agency SPA" [2] . ONE is already operating 6 plants and this one is a mover towards gas-fired plants (Arabianbusiness.com). ABB made most of the equipment and presents a huge competition for Descon if see its presence in UAE's plants and here as well.
ONE signed another contract with a Finnish company named Wartsila to increase its existing plant's production capacity, Central Gas Turbine in Dakhla (Magharebia, 2008). Another opening is presented here for Descon to offer its equipment.
Bahrain
Introduction and Political conditions:
The country gained independence in 1971. Bahrain is a small country located in a very interesting position among Persian Gulf countries. This centralized setting requires it to participate in a subtle balancing responsibility to stabilize in foreign affairs among its larger neighbors. Bahrain's oil reserves are at a low and taking this into account the country has averted its activities in petroleum and refining of crude material. It has developed itself in to an international banking center. King HAMAD bin Isa al-Khalifa, implemented economic and political reforms to make a coalition with the Shia community, in 1999. This motivated Shia political societies to come forward and participate in parliamentary and municipal elections held in 2006.
Economic Conditions:
Bahrain boasts of a notably rich economy with diversified portfolio of operations. The communication and transportation channels have been developed with finesse of a nourished country. This makes it a very lucrative place for various multi-nationals to take stance in the Persian Gulf. Then Free Trade Agreement adding to the country's standing in the market has strengthened the base for corporate business. It's again an oil dependent country with 60% of its export revenues coming from petroleum and refining and it takes 11% of the GDP. GDP (PPP) is reported to be $27.99 billion in a 2009 estimate. $19.59 billion as GDP and $38,400being the GDP per capita, the country is sufficiently stable.
(The World Factbook, 2010)
Power Structure:
The country is producing sufficiently around 10.25 Bkwh with the nation's consumption at about 10.1bkwh. The Ministry of Electricity and Water has the duty to provide for the electricity needs of the country. As reported in 2003, "Bahrain had an estimated electric generating capacity of 1.4 (GW), and produced 7.3 (bkwh). Installed capacity is barely able to meet current consumption, with the country's population growth and economic development leading to rapid power demand increases."(Langdon D, 2008)
Bahrain's first IPP, gas-fired plant was planned to be commercialized in 2006. Before that, government owned the operations of the electricity sector. The country is working on improving the infrastructure of generating, transmitting and distributing electricity across the country.
Investment Opportunity:
Seeing the trend towards IPPs, the opportunity needs to be examined as the government has now started operating towards the restructuring.
(Langdon D, 2008)
Alstom has been given the modernization contract of the Rifaa II plant to replace the old equipment with the newer one (Rifaa II Plant Upgrade).
Al-Hidd I and II are two, government owned power plants with ABB (Asea Brown Boveri) and Alstom being the respective equipment and turbine supplier. Al-Ezzel is Bahrain's first IPP, built under the equipments of Sadelmi, Siemens and Doosan providing HRSGs and came operational in 2007 (Gas Turbine and Combined-Cycle Power Plants in Bahrain, 2007).
The $1.7 billion contract to build a power and desalination plant in Bahrain was awarded to
Hyundai Heavy Industries Co., South Korea with the production capacity of 1245 MW (Dylan Bowman, 2008).
These upcoming projects can be used as entry by Descon.
Lebanon
Political Conditions:
Lebanon has been in a crucial state of national imbalance and social instability. But their resolve to have and rule their country made it possible for a besieged country like it to successfully elect a democratic leader. Their legal system is a combination of Napoleonic code, canon law, civil law and Ottoman law. The Lebanese republic organizes elections for the political parties to contest for the heading positions. Due to the existence of Palestinian refugees, several military groups operate in the territory.
Economic Conditions:
Lebanon promotes free market concept with a grip upon "laissez-faire commercial tradition"(The World Factbook, 2010). Foreign investment has been appreciated but due to several drawbacks in the economy such as, "red tape, corruption, arbitrary licensing decisions, high taxes, tariffs, and fees, archaic legislation, and weak intellectual property rights"(The World Factbook, 2010) the investors are hesitant to participate. Banking and tourism has been polished as service sectors and the country's economy has shifted towards a service economy. The GDP (PPP), GDP (exchange rate) and GDP par capita is reported to be, $53.68 billion (2009 est.), $33.04 billion (2009 est.) and $13,000(2009 est.) respectively.
(The World Factbook, 2010)
Power Structure:
The country produces 9.03 Bkwh (2007 est.) of electricity while the consumption is 8.42 Bkwh (2007 est.). It still has to import the electricity amounting 972 Mkwh (2007 est.)
Electricité du Liban (EDL) is a public institution with an industrial and commercial vocation. EDL owns 7 out of 10 power stations in the Lebanon, directly or indirectly. The power plants are comprised of 3 hydraulic and 7 hydraulic plants operating with most of them operating since late 90s.(EDL.com)
Lebanon planned to build in Zahle an IPP and its first wind-powered plant in the Bekaa Valley, according to the Daily Star. The plant will be developed by the Zahle Electricity Company, while Lebanon Wind Power will build the wind-powered facility (Lebanon Power plants, 2007).
AES Ironwood is a CCGT Power Plant with AES Corporation through its subsidiary AES Ironwood, Inc. being the owner of the plant. Siemens Westinghouse's acquired HRSGs from Hanjung for the plant (AES Ironwood CCGT Power Plant).
Investment Opportunity:
Though the country is inviting the investors, the economical situation is not very promising considering the drawbacks mentioned above. Still, the projects do present a certain level of attractiveness for Descon.
Algeria
Introduction and Political Conditions:
The country is located in a rather interesting part of earth, a North-African country, alongside the Mediterranean Sea and 80% of its area being a part of Sahara desert. Al the while touching the Atlas Mountains as well. People's Democratic Republic of Algeria is a socialist community, with laws entrenched from Islamic law and the French law. The political situation of the country is not very promising. The imbalances have been numerous and it faced civil war lately.
Economic Conditions:
Oil and gas being the major revenue generating resources of the country, the economy seems ironically feasible if compared to the political stance of the country.
Oil exports accumulate up to 30% of the GDP and 95 % of the Algeria's exports. It is ranked as 8th largest country with respect to gas reserves and 14th in the top oil reserves. The country has successfully attained foreign investment in their energy sector, thus, their resources have gotten them record foreign exchange reserves. Diversifying the economy is the current interest of the government by inviting investors in sectors other than energy. The various economical figures are reported as follows:
GDP ( purchasing power parity ) is $224.7 billion ( 2007 ) , GDP ( official exchange rate ) is $ 131.6 billion ( 2007 ), GDP real growth rate is 4.6% ( 2007 ) and GDP per capita is $6500 (2007).
(The World Factbook. 2010)
Power Structure:
26.9 Bkwh of electricity was generated by Algeria in 2003 by its traditionally usual thermal sources. These fuel resources are composed of 99% natural gas with a small amount of electricity being generated as hydroelectricity. According to the data available of 2003, Algeria produced 6.84 GW of power through installed generating capacity. The consumption of electricity is amounted at 24.9 Bkwh of electricity and the country exported its energy's excess supply to Morocco and Tunisia. The market for energy in Algeria is ripe in terms of production and an increase in demand is also foreseen in coming years.
Electricity production is done under a state-owned organization named Sonelgaz. It also controls the transmission and distribution in Algeria. Sonelgaz was privatized in 2002 to revoke its monopoly in the power sector. Still the government owns the almost all the shares of the privatized firm. (Langdon D., 2007)
Alstom provided turbines and HRSGs for Algeria's two major power plants; Skidda CCGT Power Plant and F'Kirina Power Plant. Sonelgaz S.p.A. gave the F'Kirina project to Alstom to build the plan (Transmission and Distribution World, 2003) and SNC Lavalin Constructors International Inc. was awarded the responsibilities of Skidda (Skikda CCGT Power Plant). First wind-powered energy plant is planned to be built in 2010 (Brunei Fourth Hour, 2010).
Investment Opportunity:
As Algeria has lowered the tariffs for its exports and the import licenses have been removed, the coast for trade is pretty clear and flourishing. Restrictions are there for religiously questionable products and a prohibition was announced of genetically modified organisms.
Yemen
Political Conditions:
The current government is said to be a semi-presidential government, it still is more of an autocratic government with very little freedom for the citizens. The government acts no restrictions on the power and has been ruling the country for last 15 years. No policy has been seen from the government to promote foreign entry. Moreover, the lowly security situation of the country also restricts the investors. The government did stabilize but the citizens negate to accept. Government took steps to invite investors for the energy sector viewing it as an opportunity to expand. As stated by the country manager of World Bank Robert Hindle, macroeconomic conditions are rather promising. It's just the security situation that refrain investors. The local rebels and supposed terrorists concern these investors as it would threaten their workforce as well as operations.
Economic Conditions:
Located in the Arabian Peninsula with a GDP of 3%, Yemen least developed. Wars raged by the rebels have caused a critical unrest in the nation. For energy services, the country relies on the government owned suppliers. The private sector investments have been encouraged to set up IPPs, and increase the capacity. The increasing demand for electricity has pushed the government to increase investment in power plants and focus on producing and providing electricity instead of exporting out the raw materials. The Electricity and Water Ministry in Yemen has acquired 1300 MW plant into the total electricity production capacity of the country with the aid from Saudi Fund for development.
Investment opportunities:
Yemen's 80% of the energy generated is state-owned by PEC, under the Ministry of Electricity and Water. The rest is produced by small, off-grid suppliers and privately-owned generators in rural areas. Siemens made a contract with Yemen in 2005 to build a gas-fired power plant costing $160 million. The plant was expected to be operational in 2008. A gas-fired power plant was also planned to be built at Safar. Arab Fund for Economic and Social Development, the Saudi Development Fund, and the government will provide the capital. Wartsila finished the Mukalla power project in 1998. "The project included the construction of a 40-MW diesel-fired plant, six substations, and the laying of 62 miles of transmission lines. The Finnish firm Wartsila recently completed the Aden power project. The Al Hiswa plant is currently under consideration for expansion."
International Development Foundation (IDF) approved Yemen a $33 million loan for the "Sanaa Emergency Power Project. Kuwait-based, Arab Fund for Economic & Social Development (AFESD) and the Saudi Fund for Development (SFD) supported financiallythe first phase of the Marib power plant project. (Langdon D., 2008).
The country presents a huge unexplored market for the investors. Risk taking investors might like to take the bet on and invest.
