GCCIA and QDF Sign Landmark Financing Agreement for Oman Direct Interconnection Project

Environment

GCCIA and QDF Sign Landmark Financing Agreement for Oman Direct Interconnection Project

Strengthening Regional Energy Integration and Sustainability

The Gulf Cooperation Council Interconnection Authority (GCCIA) and the Qatar Development Fund (QDF) have signed a landmark financing agreement to support the Oman Direct Interconnection Project, a transformative initiative that will strengthen energy integration across the GCC region.

Under the patronage of H.E. Engineer Salim Al Aufi, Minister of Energy and Minerals of Oman, the signing ceremony was attended by H.E. Mohsin Al Hadhrami, Undersecretary of the Ministry of Energy and Minerals and Chairman of the GCCIA, and H.E. Sheikh Mubarak bin Fahad Al Thani, Ambassador of Qatar to Oman. The agreement was officially signed by H.E. Eng. Ahmed Ali Al-Ebrahim, CEO of the GCCIA, and H.E. Fahad Hamad Al Sulaiti, Director General of QDF, during a special event in Muscat.

Key Highlights of the Oman Direct Interconnection Project

The project will construct two 400 kV overhead transmission lines spanning 530 kilometers, connecting the GCCIA’s Al Sila station in the UAE to the new Ibri station in Oman. Additional infrastructure includes:

Two 400 kV substations in Ibri and Al Baynunah, equipped with advanced control, protection, and communication systems.
A dynamic compensator station to enhance grid stability and transmission capacity.
A total transmission capacity of 1,700 MW, with a net transfer capacity of 1,200 MW.

A Strategic Step Toward Gulf Energy Integration

The interconnection project is a critical step toward the seamless integration of Gulf power grids, aligning with global energy infrastructure advancements and sustainability goals.

H.E. Engineer Salim Al Aufi, Minister of Energy and Minerals, emphasized the project's strategic role in strengthening regional energy security, reliability, and sustainability. He praised GCCIA’s leadership in interconnecting Gulf electricity networks and highlighted the Qatar Development Fund’s crucial support in financing sustainable energy initiatives.

H.E. Mohsin Al Hadhrami, Chairman of the GCCIA, stated that the project builds on the GCC's long-term vision of enhancing cross-border electricity trade and ensuring uninterrupted power supply. He noted that the GCCIA network has successfully prevented over 2,800 power outages since its inception in 2009.

Economic and Environmental Benefits

The Oman Direct Interconnection Project will generate significant economic and environmental benefits for Oman and the broader GCC region, including:

✔ Reduced need for new power plants, unlocking additional electricity generation capacity.
✔ Lower operational costs through improved efficiency and energy exchange.
✔ Enhanced grid stability, minimizing disruptions and blackouts.
✔ Reduction in carbon emissions, supporting global climate goals and sustainable energy practices.

Looking to the Future: Expanding Regional Energy Trade

H.E. Eng. Ahmed Al-Ebrahim, CEO of the GCCIA, confirmed that construction will commence in the second half of 2025, with completion scheduled for the first half of 2027. He emphasized that the project will:

🔹 Prepare the GCC power network for future energy demands and grid expansion.
🔹 Support renewable energy integration, including solar and wind power.
🔹 Facilitate electricity trade between the GCC and Iraq, unlocking new energy market opportunities.

The financing agreement further strengthens the partnership between GCCIA and QDF, building on successful initiatives like the South Iraq connection project. Three additional major power projects are currently in progress, connecting Kuwait, the UAE, and Oman, with a total investment exceeding $1 billion USD.

QDF’s Commitment to Regional Economic Growth

H.E. Fahad Hamad Al Sulaiti, General Manager of the Qatar Development Fund, underscored the importance of energy as a catalyst for economic growth and stability in the Arab world. He reiterated QDF’s dedication to financing strategic infrastructure projects that promote sustainable development and regional cooperation.

Conclusion

The Oman Direct Interconnection Project marks a historic milestone in GCC energy collaboration, paving the way for a more resilient, efficient, and sustainable regional power grid. With enhanced energy security, economic benefits, and environmental advantages, this project solidifies the GCC's leadership in power infrastructure and cross-border electricity trade.