A Loan Agreement was signed today in Kuwait Fund Headquarters between Gulf Cooperation Council Interconnection Authority) GCCIA (and Kuwait Fund for Arab Economic Development, whereby The Kuwait Fund will provide a Loan in the amount of 35 Million Kuwaiti Dinars (equivalent to about USD115.5 Million), to participate in the financing of the Development of the Gulf Cooperative Council Electricity Interconnection System and Connecting with the South of Iraq Network Project.

            The Loan Agreement was signed on behalf of the Gulf Cooperative Council Interconnection Authority (GCCIA), by His Excellency Ahmed Bin Ali Al Ibrahim, CEO of GCCIA, while the Loan Agreements was signed on behalf of the Kuwait Fund for Arab Economic Development, by Mr. Marwan A. Th. AL-Ghanem, Director General of the Kuwait Fund, In the presence of His Excellency Dr. Nayef Falah M. Al-Hajraf, Secretary General of the Cooperation Council for the Arab States of the Gulf.

 

            The Project will have significant technical and economic benefits.  It will increase the capacity and efficiency of the electricity networks of the member States of the Authority.  The State of Kuwait will be one of the largest beneficiaries of the project.   The capacity supporting the electricity grid in Kuwait will increased by approximately 2,500 megawatts.  This will increase the supply and operational efficiency of the Kuwaiti electricity grid.  The project will also have benefits for the network in southern Iraq, where it will be equipped with a reliable electricity capacity of 500 megawatts.

 

            The Project aims to meet part of the electricity demand for and improve the performance and stability of the electricity grid in Iraqi and it will also contribute to reinforcing the internal GCC-Interconnection Network and increase their reliability to ensure the sustainability of electricity at all times.

            The Project will also contribute to the achievement of a number of sustainable development goals, including, the third (Good Health and well-being), the fourth (Quality Education), the seventh (Affordable and clean energy), the eighth  (Decent work and  economic growth), the ninth (Industry innovation and infrastructure), the eleventh (Sustainable cities and communities) and the seventeenth (Partnership for the goals).

           

            The project consists of the construction of a new connecting plant with the Gulf connecting system in Al-Wafra city of the State of Kuwait on an area of about 62,000 square meters and the extension of 500 kV dual-circle transmission from the Al-Wafra station to Al-Faw city station in southern Iraq with a length of about 295 kilometers.  The project also includes the supply and installation of cutters, electrical reactions and measurement and control systems for the construction and expansion of conversion stations in the cities of Al-Wafra, Al-Fathaili and Al-Faw.  The project also includes the addition of new electrical installations to strengthen the network connected to Al-Wafra station to enable it to absorb electrical capacity of approximately 2,500 MW as well as to strengthen the grid in southern Iraq associated with Al-Faw station to enable it to absorb an electrical capacity of at least 500 MW. The Project will also consist of consultancy services for the preparation of environmental and social studies and supervision of implementation. 

The Kuwait Fund Loan referred to represents the first loan provided by the Fund to the Interconnection Authority GCCIA, for the Gulf electrical interconnection system and connecting with the southern Iraq network. The Fund also intends to provide a second loan to finance the project under the terms to be agreed in the second Loan Agreement.