Dubai offers gas to Northern Emirates

Dubai is ready to export gas to the Northern Emirates in case of emergency, a top official from the Dubai Water and Electricity Authority told Emirates Business.

Saeed Mohammed Al Tayer, Dewa Managing Director and Chief Executive Officer said the emirate always keeps 15 per cent of its capacity as reserves, which it could use to help its sister emirates in times of urgent need.

"Dubai can afford to help Northern Emirates in winter because there is surplus gas during the season. In the summer, if the demand is not as high as expected then I think it will be easy for Dewa to export during this time as well," he said.

"It is very difficult to say how much we can export but we can give surplus at any time for emergency. But not for long term," he said, adding that Dewa last year saw 1,200MW of reserves.

The Northern Emirates, which comprise Ras Al Khaimah, Ajman and Fujairah – have been experiencing a power squeeze due to a gas shortage. A number of developers in Ajman for example have resorted to private power generation to fuel up developments. These emirates nonetheless are trying to rise to the challenge of meeting energy needs by planning to increase electricity generation capacity and diversifying sources of power and fuel.

RAK has long relied on electricity from the grid operated by the UAE's Federal Electric and Water Authority (Fewa), but is increasingly looking to develop its own generating capacity as the demand placed on the authority's network rises.

Part of the emirate's efforts to overcome the energy shortage includes Ras Al Khaimah Minerals and Metals Investments, an arm of the Ras Al Khaimah Investment Authority. While buying into metals mines in Asia and Africa, RMMI is also investing in coal production.

Similarly, Ajman is also looking at coal for its future energy security. Last year, the emirate signed a Dh7.3bn deal with Malaysian power company MMC to build the Gulf's first coal plant, which is likely to come online in 2012.

The one gigawatt plant should provide sufficient capacity both to meet Ajman's current demand and create a cushion for future growth. However, the lignite feedstock will need to be sourced from several thousand miles away – most likely South Africa – an ironic situation given the abundance of natural gas in the region.

Meanwhile, the Federal National Council recently gave approval for private companies to generate power and desalinate water under the supervision of Fewa.

This, according to Oxford Business Group, may ease short-term bottlenecks.

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