Kuwait Fund For Arab Economic Development To Provide Second Loan Of $570 Million For Gulf Electricity Interconnection Expansion Project

Representational image. Credit: Canva

The Gulf Electricity Interconnection Expansion Project, overseen by the Gulf Cooperation Council Interconnection Authority (GCCIA), represents a collaborative effort among Gulf and regional stakeholders to address rising electricity demands in Gulf states and Iraq.


This initiative promises significant technical and economic advantages. It will enhance the capacity, efficiency, and reliability of the electrical network for GCCIA-member nations, ensuring a consistent supply of electrical energy. Additionally, Gulf countries will have the opportunity to commercially benefit from surplus production capacity.


Kuwait stands to gain the most from this project, with an expected increase in its electricity network capacity by around 2,500 megawatts. This boost will improve Kuwait’s electrical network’s operational efficiency.


Southern Iraq will also benefit from the project, receiving an additional electrical capacity of 500 megawatts. This will help meet some of the region’s energy demand and enhance the network’s performance and stability.

The project, known as GEIEP, involves the establishment of a primary linking station in Kuwait’s Al-Wafrah station. It includes the construction of double overhead lines connecting to Saudi Arabia’s Al-Fadhili station, followed by a double overhead line conversion to the Al-Zour area in Kuwait. Overhead lines will also be constructed from the Al-Wafrah area to the Sabah Al-Ahmad (3) and Sabah Al-Ahmad (4) stations to connect with Kuwait’s network. Additionally, a network of 400-kilovolt overhead lines will connect to Iraq’s Al-Faw station, linking it with the global network.

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Mr Guillaume Jahan, CEO of Vinci Energies, the implementing company, explained that the project encompasses the construction of the Al-Wafrah station in Kuwait and the extension of overhead transmission lines with a 400-kilovolt, two-circuit capacity to connect the new station to Saudi Arabia.

Overall, the Interconnection project will enhance the Electrical Interconnection Authority’s electrical transmission network capacity, while the extended lines to Iraq will improve connectivity with Kuwait.

This project is viewed as a significant milestone in the Electricity Interconnection Authority’s efforts to establish a flexible electrical interconnection network that ensures energy security and economic benefits for all member states.

Furthermore, the project aligns with sustainable development goals such as promoting health, well-being, quality education, clean and affordable energy, decent work, economic growth, innovation, and infrastructure development. It also contributes to the sustainability of cities and local communities while fostering partnerships.

The estimated project cost is approximately USD 570 million (about KD 172.8 million), with an expected economic return of about 14.4%. The Kuwait Fund for Arab Economic Development signed a loan agreement worth KD 35 million (about USD 115 million) in March 2022 to support project financing. A second loan from the Kuwait Fund for this project is also being considered. The Al-Wafrah station project is anticipated to be completed by December 2024.

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