SYRIA - Syria's 1st IPP.

The new capacity by 2003 will include a 600 MW IPP, the first private power venture in Syria called Syrian Power Investment Co. (SPIC). Incorporated under Belgian law in 1994, SPIC is a joint venture between the Syrian-owned Sarakbi Group (headed by US-based Bourhan Sarakbi), and Tractebel of Belgium. The IPP is to be located at Bardeh, 150 km north of Damascus, and the plant is to be a build-operate-own-transfer (BOOT) venture. The government confirmed its support for the project in December 1997, but negotiations about the tariff have since been dragging on between the PEE and SPIC. Delays were caused by a hardening of PEE's position in early 1999 following extremely low tariffs which Egypt secured from its three IPPs. A Sarakbi executive in mid-1999 was quoted as saying: "The eventual price will be higher than in Egypt because of the extra costs in Syria, particularly on the financing".

The rapid rise in generating capacity in recent years followed high demand growth which sparked off a period of power cuts in the early 1990s. This led President Assad to declare in September 1993 that every citizen had the right to a secure power supply. Until 1994 power cuts used to last several hours a day. The situation was so bad that supplies in war-ravaged Lebanon and Iraq were better than in Syria. After the government made upgrading this sector a priority, Electricite de France - under a 2-month EU-financed contract in 1994 - did a study to improve PEE's operations.

Financing for new power plants was done mainly by Japan's Overseas Economic Co-operation Fund (OECF), the Kuwait Fund for Arab Economic Development (KFAED), the Saudi Development Fund (SDF) and the Kuwait-based Arab Fund for Social and Economic Development (AFESD).

Capacity expansions on an emergency basis were carried out in the mid-1990s. Eight 125 MW gas turbines were added in various parts of the country during that period. These were installed by FiatAvio of Italy as part of contracts worth more than $300m awarded in 1994 and financed by KFAED. Of these turbines, three units operating since mid-1998 generate 384 MW at Zaizoun, near Idlib in the north-west, fuelled by gas from Palmyra fields delivered through a 120 km pipeline. The plant was financed by AFESD. A 375 MW gas-fired plant built by FiatAvio at Nasiriyah, 40 km north-east of Damascus, started up in 1997 and was financed by KFAED.

Mitsubishi Heavy Industries (MHI), as part of a Japanese consortium including Mitsubishi Electric  and Fuji Electric, has had a big role in the Syrian power sector. In December 1995 a 600 MW combined-cycle (CC) plant built by MHI began operating at Jandar, south of Homs. Financed by a $410m OECF loan, it has four 100 MW gas turbines and two 100 MW steam turbines. MHI began building a 1,000 MW steam plant at Aleppo in 1996 with a $530m loan from SDF, and the first three 200 MW units started up in early 2000 - the other two units will be completed in 2001. MHI has also built for Syrian Petroleum Co. the 600 MW Al Zara gas-based power station near Homs, with a $440m OECF loan. Its first 200 MW unit began operating in late 1999. The final 200 MW unit is to start up by end-2000. The plant has a pressure reduction and metering system for the gas intake facility. MHI had implemented the expansion of the Banias power plant in 1986, under a $296m Japanese loan; and this now has a 680 MW capacity with a dual usesystem for fuel oil and gas.

Two hydro-power plants are being built, one on the Euphrates to consist of six 105 MW units being built of Sichuan Machinery & Equipment of China and financed by KFAED, and one at Al Thawra dam to have three 25 MW units. They will be completed by late 2000 or early 2001.

Rehabilitation and conversion projects include work at the 630 MW Mhardeh power plant, on the Mediterranean north-west of Hama, and at the 680 MW Banias plant. Lahmeyer International of Germany is the consultant for the Mhardeh plant. Enel, the Italian power utility, has been involved in the upgrading of Banias. Also to be upgraded are the 400 MW Tishreen gas-fired plant in Damascus (built in the 1980s by the Soviets) which will be expanded by a CC unit of 250 MW before 2002, and the 375 MW Nasiriyah station which will be expanded by a CC unit of 250 MW. Bidding for both were invited in early 2000.

Apart from these, the PEE has the following gas-fired plants: a 450 MW station at Suwaidiyah, a 120 MW plant in Der Ez Zor, a 90 MW plant in Al Thayyem, and a 60 MW plant at Qattinah. The PEE has nine 100 MW hydro-power plants at the Euphrates Dam which, together, have been operating at 200 MW due to low water levels in Lake Assad and technical problems.

Another important development in this sector is the planned link-up of the Syrian power grid to those of Turkey, Iraq, Jordan and Egypt, under an agreement signed in Damascus in August 1996, being financed by AFESD. The link to Jordan has entailed a 400 kV transmission line from Jandar to the Amman North substation done recently by KEC International of India under. a $45m contract signed in Nov. 1997. Jordan is already linked to Egypt's network, which means Syria's and Egypt's grids are connected. The link from Damascus to the Turkish border is being built by a consortium of Galkon of Turkey and SAG of Germany.