As a Middle Eastern country without hydrocarbon reserves, Jordan stands out. Not only must it import all of its oil and gas, it also imports a significant amount of electricity to ensure that demand is met.

However, Jordan has considerable uranium deposits, which the government is keen to exploit. It wants the country to become a net power exporter within the next 20 years by developing a nuclear power programme.

In January 2008, Amman founded the Jordan Atomic Energy Commission (JAEC). Now in its third year, JAEC has already achieved much towards making Jordan’s nuclear power ambitions a reality.

Yet with consumption forecast to expand threefold by 2030, meeting domestic demand alone will be challenging. Whether it will also manage to facilitate the selling of power to Jordan’s neighbours within the next two decades is another matter.

Fuel mix in Jordan

Jordan currently generates almost 3GW of electricity using a combination of diesel, gas, hydropower, wind and biogas. Steam generation and gas-fired power plants represent the largest portion of the energy mix, accounting for more than 80 per cent of total power generation.

We are not in a race to develop nuclear power. If it takes a few months more than we anticipated, it is alright

Ned Xoubi, Jordan Atomic Energy Commission

The country’s fuel use has changed over time in favour of natural gas and away from heavy fuel and diesel. Between 2006 and 2009, the use of heavy oil to generate electricity decreased by about 50 per cent, while gas usage increased by roughly 50 per cent. The use of diesel declined by 18 per cent.

Jordan generates most of the electricity it uses, with the remainder imported from Egypt and Syria. The amount imported from both countries has declined over time. In 2006, it received 472GWh from Egypt and 42GWh from Syria, and by 2009 this had fallen to 363GWh and 20GWh respectively.

Nevertheless, electricity imports still cost the country JD552m ($779m) a year according to local utility National Electric Power Company (Nepco). And with electricity demand set to rise from about 2.4GW in 2010 to 7.1GW by 2030, the financial strain on the state will only grow.

Jordan has been successful in establishing a private power sector, which has helped to share some of the burden, and it is currently tendering its third independent power project. But access to fuel for these is a major issue, with additional supplies from Egypt difficult to secure. Blessed with uranium deposits, nuclear power is an obvious solution to Amman’s energy problems.

The most challenging issue for nuclear power in Jordan isn’t the supply chain, it’s the personnel issue

Ned Xoubi, Jordan Atomic Energy Commission

From the outset, JAEC has approached its task at a “slow and steady” pace, fully aware of the sensitivities surrounding nuclear power in the Middle East. The government of Jordan has signed cooperation agreements with a host of countries, including Turkey, Spain, Argentina, Canada, China, France, Russia, South Korea and the UK. It has also signed memorandums of understanding – a precursor to a cooperation agreement – with Japan and the US.

Research reactor in Jordan

Amman is developing a 5MW test facility to build up the country’s experience in atomic energy. In December 2009, a team of Korea Atomic Energy Research Institute and Daewoo Engineering & Construction was selected to develop the research reactor. The South Korean partnership was selected over competing bids from Russia’s Atomstroyexport, Argentina’s Invap and China National Nuclear Corporation. Of the $130m project costs, export credit agency Korea Export-Import Bank has committed $70m as a loan.

Jordan Center for Nuclear Research has completed the basic design for the project and is now working on detailed designs and procurement strategy. It is also working with the Jordan Nuclear Regulatory Commission and Korea Institute of Nuclear Safety on the licensing and regulatory frameworks needed for the nuclear programme.

The research reactor is scheduled to start operating in March 2015 at Jordan University of Science & Technology (JUST) campus in Ramtha.

With the test facility making progress, JAEC is also moving ahead with plans to develop a 2GW nuclear power project. Amman awarded a feasibility study contract for the project to Australia’s WorleyParsons in early November 2009. The company is carrying out pre-construction work and advising JAEC on the choice of technology.

Three teams have been preselected for the contract to build the nuclear power plant. They are France’s Areva with Japan’s Mitsubishi, Russia’s Atomstroyexport and Atomic Energy of Canada Limited. A South Korean team was initially in the tender, but it was excluded following an evaluation of the technical aspects of the bid.

The site for the project was moved at the end of 2010 from Aqaba to Kerbaht al-Samra. Despite the change, the project remains on schedule and a developer is due to be selected before the end of 2011, according to JAEC.

The chosen developer will take an equity stake in the project, the size of which is still under negotiation, along with the bid prices. The power plant is planned to be operational by 2020.

Jordan is not the only country in the Middle East developing a civilian nuclear energy programme to overcome a regional shortage of gas. But its domestic reserves of uranium gives it a distinct advantage over the other states looking to diversify their energy mix.

Preliminary estimates have confirmed the presence of natural uranium in large quantities in central Jordan. Up to 65,000 tonnes exist in the form of surface sediment, in addition to about 100,000 tonnes in phosphate.

JAEC signed an agreement with Areva to explore central Jordan for uranium deposits in September 2008. It also signed an agreement with Australia’s Rio Tinto in February 2009 for uranium exploration in the south and east of the country. Areva’s report on reserve estimates and a feasibility study has yet to be presented and is now overdue. But initial studies said its concession area could produce 2,000 tonnes a year of uranium from 2012 – more than enough to satisfy Jordan’s needs.

Technical challenge for nuclear energy project

Amman is still a long way from being able to act on information about its uranium reserves. Processing uranium for the purpose of nuclear energy is technically complex and it will also need to overcome significant regulatory hurdles.

In addition, Jordan will face many of the same challenges as the other countries in the Middle East that are looking to develop nuclear power capacity. Technical issues, such as siting, can largely be overcome. The Vienna-based International Atomic Energy Agency has a comprehensive set of guidelines for countries to follow and there are many international examples to refer to. That said, the environmental aspects specific to the region have yet to be explored.

One of the greatest hurdles is likely to be financing. The construction phase of a nuclear power project is highly capital-intensive.

This is less of an issue for wealthy governments in Abu Dhabi and Riyadh, but providing upfront capital for nuclear power projects in cash-strapped Jordan will be more problematic. International developers and investors have shown their confidence in the country’s power sector through its independent power plant programme, but it is unclear whether this will extend to projects of a much larger size, such as the nuclear scheme.

Abu Dhabi is providing government guarantees to the developer consortium on its first nuclear power plant, thereby buoying confidence. Amman will not be able to do the same.

And while Jordan has secured a head start in the race to develop nuclear generation capacity, other countries in the region are forging ahead at a fast pace. Saudi Arabia, Kuwait, Bahrain and Egypt, among others, have also revealed ambitious nuclear power plans.

Saudi Arabia, in particular, is likely to dominate the region in terms of atomic energy with several projects likely to be launched to the market. Beyond the Middle East, the situation is the same – declining oil and gas reserves and escalating fossil fuel prices have led to a nuclear renaissance.

With only a handful of nuclear power contractors in the world, the supply chain could quickly become congested. Consequently, governments will need to compete to secure the contractors, technology providers and scientists required to execute their nuclear energy programmes.

Developers will have constrained balance sheets and therefore could struggle to make equity commitments for multiple nuclear projects. Those governments that are able to support private-sector commitments or pay upfront will be granted preference. Without the ability to do so, Jordan could be left behind.

But JAEC says it will not be drawn into a race to acquire nuclear power. “We made it clear from the start that we are not in a race to develop nuclear power,” says Ned Xoubi, JAEC nuclear fuel cycle commissioner and project director. “If it takes a few months more than we anticipated, it is alright. It’s better to do that than make mistakes that you later regret.”

Resource pool for nuclear energy schemes

Xoubi says the limited pool of nuclear specialists will be the main obstacle to Amman’s nuclear ambitions. “The most challenging issue for nuclear power in Jordan isn’t the supply chain,” he says. “It’s the personnel issue. From technical experts to safety and legal experts, there is a shortage of people for such projects.”

Jordan has taken steps to address the human resources challenge. In 2007, a nuclear engineering department was set up at JUST and its first 20 students will graduate this year. But much more will need to be done to build up the required skills base.

While many governments in the Middle East have unveiled plans to develop nuclear power, it is Jordan that stands to gain the most from it. Atomic energy would enable Amman to cut its fuel import costs and eliminate the need to buy-in electricity, which combined equate to nearly 25 per cent of the national budget.

Developing nuclear power would also mark the country out as a regional pioneer in the technology and feed into its long-term uranium enrichment aspirations.

Becoming a net exporter of electricity and potentially of uranium for the region’s nuclear power facilities would be transformational for Amman, long held back by its lack of oil and gas reserves. Jordan may well be on the cusp of reversing its economic fortunes – so long as it takes the right steps.