District Energy - 2010 Third Quarter

Industry
News
Middle East Industry News

Drake & Scull Awarded
UAE Contracts

Drake & Scull Water and Power LLC, a subsidiary of Drake & Scull International, has been awarded a contract to build the entire utilities infrastructure for the residential compound located in Khalifa A City, Abu Dhabi. Earlier this year, the company was awarded a 118 million dirham ($32 million) district cooling contract at the same compound, including a chiller plant with 20,000 tons of refrigeration capacity and two thermal storage tanks. This latest contract win marked the eighth for Drake & Scull International this year, bringing the total value of projects awarded to the company in first quarter 2010 to 1 billion dirhams ($272.3 million).

The Pearl-Qatar, a freehold zone, is the first development where Qatar Cool is providing its services directly to end users; previously, the company dealt solely with property developers.

Perma-Pipe Saudi Arabia will feature the company’s Xtru-Therm automated spray polyurethane insulation and several jacketing systems including polyethylene, metal and fiber-reinforced polymer. The plant will also be equipped to custom-manufacture pipe spools and a complete range of preinsulated fittings.

Tabreed Sells Stake in
Jordanian Unit

Tabreed has sold its 50 percent stake in its Jordanian subsidiary, Tabreed Jordan. The Abu Dhabi-based Tabreed announced in March that it would turn to Abu Dhabi for support after it posted a $305 million loss for 2009. The company said in a statement it had completed the sale of Tabreed Jordan on March 17. The financial terms of the sale were not disclosed.

Empower Starts Bay Square
Phase 3

Emirates Central Cooling Systems Corp. (Empower) announced in early May that it had begun work on the third phase of the 70,000-refrigeration-tonne district cooling network that will serve Bay Square within Business Bay in Dubai. Bay Square is a new business, retail and residential development designed to be a creative business hot spot offering more than 1. 6 million sq ft of office space.

Empower earlier announced completion of the first two phases of its Business Bay project, which include a 50,000-referigeration-tonne district cooling plant serving the Business Bay Executive Towers and the Towers Area overlooking Sheikh Zayed Road.

Qatar Cool Opens Customer
Service Office

Qatar Cool has opened its first customer service office at The Pearl-Qatar. The company, which is the sole supplier of district cooling to The Pearl-Qatar project, will eventually have the world’s largest district cooling plant at the site, providing 130,000 tons of refrigeration when fully operational.

The new customer service office is located in Parcel 1 inside the Porto Arabia Commercial Bank branch, where customers are able to meet Qatar Cool customer service representatives fluent in Arabic and English and to make payments conveniently.

Perma-Pipe Announces
New Plant

Perma-Pipe Inc. announced in May that the board of directors of its parent company, MFRI Inc., had approved establishment of an additional insulated pipe manufacturing plant in the Gulf region. To be located in Dammam, Saudi Arabia, the new plant will be developed and operated by Perma-Pipe subsidiary Perma-Pipe Middle East in tandem with its existing plant in the United Arab Emirates.

A site for the new Perma-Pipe Saudi Arabia has been leased in Dammam Industrial Area; plant engineering and design is currently in progress. Expected to be fully operational in 2011, the new manufacturing facility will serve the special requirements of the oil and gas industry as well as the rapidly growing district cooling market in the Kingdom of Saudi Arabia.

Construction Picks Up
as Economies Regain
Confidence

A May 5 Gulf News article reported that the first four months of 2010 saw a clear uptick in construction contracts being awarded in the real estate and oil and gas sectors, especially in the United Arab Emirates and Saudi Arabia. As an example of this recent activity, the article pointed to Saudi Tabreed Cooling Co.’s recent signing of a 1. 84 billion Saudi riyal ($490.6 million) deal with Saudi Aramco to build a central district cooling unit. The project, financed by Banque Saudi Fransi, will be implemented on a build-own-operate basis.

As an economic advisor to a prominent multinational bank told Gulf News, “Confidence is seeping back in to the Gulf economies after good news from the U.S. and Europe.” Deepak Tolani, vice president at Al Mal Capital, commented, “We are noticing more projects being awarded. We also see banks slowly returning to financing projects. Governments are leading the way, and the corporate environment is coming back with its own contribution.”

SNC-Lavalin Wins Saudi
Arabian Project

SNC-Lavalin Construction has been awarded an engineering, procurement and construction contract by Saudi Tabreed for district cooling facilities in Dhahran in the Eastern Province of the Kingdom of Saudi Arabia. The value of the contract is CA$105 million ($101.9 million).