Gulf Construction Online - Key progress made on Oxagon’s power projects

Saudi Focus

Oxagon ... the industrial hub at Neom.

Key progress made on Oxagon’s power projects

01 July 2023

India's top engineering and construction firm Larsen & Toubro (L&T) has announced that one of its key units – Power Transmission and Distribution (T&D) – has achieved major milestones on the $2.8-billion power elements and grid packages for setting up the world’s largest green hydrogen plant in Neom, the $500-billion futuristic city on Saudi Arabia’s northwest coast.

The project is being developed by Neom Green Hydrogen Company (NGHC), a joint venture between Saudi utility project developer Acwa Power, global industrial gases leader Air Products and Neom.

NGHC is setting up the mega plant to produce green hydrogen at-scale for global export in the form of green ammonia at a total investment of $8.4 billion.

Supported by 23 local, regional, and international banking and financial institutions, the project has now achieved full financial close, and construction is moving forward.

A few quarters back, L&T said it had received the nod to establish the renewable energy generation, storage and grid infrastructure, from Air Products, the system integrating EPC contractor and exclusive off-taker of green ammonia to be produced from the project.

The value of the packages awarded to L&T aggregates to $2.779 billion. Since then, significant progress has been achieved in various activities including surveys, design and engineering, establishment of temporary facilities and procurement of long lead items, it stated.

Under these contracts, T&D business will engineer, procure, and construct a 2.2 GWac PV solar plant, 1.65 GW wind generation balance of the facility as well as a 400 MWh Battery Energy Storage System at Oxagon, Neom’s hub for advanced and clean industries with industrial innovation at its core.

It will also construct three 380 kV switching stations in addition to setting up 306 km of 380 kV overhead lines and underground cables required for the kingdom’s grid network, said the Indian construction giant. The scope also includes the energy power monitoring system (EPMS) for the complete network, it added.

Meanwhile, Grid Solutions, an integral part of the GE Vernova portfolio of energy businesses, said it has been awarded a contract by L&T to supply 380 kV T155 gas-insulated substations (GIS) for the hydrogen plant.

Also in the power sector, Louis Berger Services said its joint venture with KFB Holding Group/Exap Contracting, has secured a power generation contract for the construction of the floating industrial zone Oxagon at Neom.

A member of leading engineering consulting firm WSP, Louis Berger Services is a specialist in turnkey power projects, infrastructure operations, maintenance, logistics and ground support services.

Under this deal, as the engineering, procurement and construction (EPC) contractor, the Louis Berger Services joint venture - LBPKSA - will design, supply, and install a containerised diesel power plant for the Saudi Arabian Trading & Construction Company (Satco).

Because the power plant will operate on prime power applications, the system will be able to reliably supply 24/7 power operation to Oxagon’s developers and residents who are building the city. Oxagon will be a 7-km-wide floating city, making it the largest floating structure in the world.

The diesel power plant for Oxagon marks LBPKSA’s third power generation contract to support the visionary NEOM region.

As per the contract, the joint venture firm has provided green power solutions to Satco and the Al Tamimi Group to help build two residential camps (NEOM Construction Village 2) within the futuristic city that will house 30,000 people, it stated.

For Satco, the Louis Berger JV had engineered, supplied, installed and tested/commissioned a hybrid power plant that integrates solar photovoltaic (PV) power technology, including an automatic robotic cleaning system with conventional power and battery energy storage.

The hybrid power system will reduce carbon dioxide (CO2) emissions by 6,491.7 tonnes per year and cut diesel fuel consumption by 2,801,100 liters per year, it stated.

Louis Berger Services said its joint venture has begun a power generation contract using Cummins generator technology to help support construction of the housing camp at Oxagon.

LBPKSA designed, built, installed, and tested/commissioned a solar PV powerplant for the Al Tamimi Group that features its own robotic cleaning system, in integration with the existing conventional power plant. The solar PV technology will reduce CO2 emissions by 8,093 tons per year and decrease diesel fuel consumption by 3,492,300 liters per year.

Among other developments, Hitachi Energy, a global leader in sustainable energy solutions, has secured a major contract from Enowa and the Saudi Electricity Company (SEC) to design, develop and commission one of the world's first 3 GW, 525 kilovolt (kV) HVDC Light transmission systems in Neom.

The ground-breaking deal inked with Enowa, the energy and water company of Neom, and SEC will see Hitachi Energy design and develop the first phase of the visionary Neom region transmission system, together with its consortium partner Saudi Services for Electro Mechanical Works (SSEM).

This system will help connect Oxagon - home to advanced and clean industries with industrial innovation at its core within the Saudi futuristic city – to the Yanbu area, over a distance of more than 650 km in western Saudi Arabia, it added.

Hitachi Energy's project scope includes the design, engineering, procurement of HVDC technology and commissioning of the HVDC Light converter stations.

SSEM, a leading Saudi engineering, procurement, and construction (EPC) company specialised in power projects, will design and supply the AC equipment and handle the construction and installation. The converter stations will convert power from AC to DC and back to AC for integration into the receiving grid.

Neom is designed to be a blueprint for sustainable urban living, utilising 100 percent clean energy from renewable sources such as solar, wind, and green hydrogen. To achieve this goal, Hitachi Energy will supply three high-voltage direct current (HVDC) transmission systems with a total power capacity of up to 9 gigawatts (GW) to Enowa.

Additionally, Hitachi Energy and Enowa have signed an agreement for two HVDC projects, each with a capacity of up to 3 GW. These projects will be part of a scalable and modular regional network design that aims to seamlessly integrate future renewables and energy storage technologies into the Neom Energy System.

The collaboration will also explore opportunities to develop local competencies in the Kingdom, including the sustainable assembly of HVDC Light components, it added.