In October, the UAE cabinet amended existing legislation to allow private investment in the northern emirates’ power and water sectors.
But whether Dewa’s independent water and power project (IWPP) can go ahead depends entirely on the availability of feedstock.
Both Dubai and the northern emirates have made it clear the onus will be on developers to source feedstock for IWPPs.
But with growing concern over the availability of gas feedstock, this is no small task. Dewa itself was thought to have been considering using oil to fuel its PStation at Hassyan, although the authority has now confirmed that it will use gas feedstock.
Others in the region are also feeling the pressure. Under a 2006 royal decree, all of Saudi Arabia’s future coastal power plants will be oil-fired. In Bahrain, it is still unclear whether the Addur IWWP will be dual-fired by both gas and oil or purely gas-fired.
The UAE also needs to decide whether it will prioritise the use of gas for power generation or industry.
Gas from Qatar, via the Dolphin pipeline, is unlikely to resolve the problem. It may simply replace existing Abu Dhabi National Oil Company supplies, which have been earmarked for oil-field reinjection.
Dolphin phase 2 could bring in an additional 1.2 billion cubic feet a day of gas, but for now this is only a distant possibility. Qatar’s moratorium on new production from its north field means the UAE will not see any more gas for some time.
After years of developing plans on the basis of abundant supplies of cleaner, more efficient gas feedstock, it is clear that the region currently lacks the gas to keep pace with development. Governments are faced with little alternative but to go back to oil.