CAIRO // Fifty-five years after Egypt first announced its plan to build a nuclear power plant, energy authorities said this month they expect to launch an international tender for the project by the end of this year.
If everything goes according to plan, Egyptian authorities say, they will complete the country's first nuclear power plant by 2019 in the Al Dabaa region on the Mediterranean coast. The facility is expected to cost about US$4 billion (Dh14.7bn), not including operating costs and interest payments.
But even if the delays in building what was to have been the Arab world's first nuclear power plant have seemed interminable, the usual suspects - the established nuclear powers and international non-proliferation organisations - are not to blame.
After all, it was the US president Richard Nixon who offered to help Egypt build eight nuclear reactors in 1974, several years before Egypt became the first Arab country to make peace with Israel, and US companies have always been among the top bidders for past nuclear technology tenders.
And it was Yukiya Amano, the head of the International Atomic Energy Agency (IAEA), who announced in June that he was "happy" to work with Egypt on its plan to develop four nuclear reactors by 2025.
Instead, it has been domestic political concerns that have dogged the project's progress since the former president Gamal Abdel Nasser established the country's Atomic Energy Commission in 1955.
Egypt's disastrous loss in its 1967 war with Israel, followed by the Chernobyl nuclear meltdown in 1986, sapped the country's appetite for what seemed an increasingly unpredictable and potentially disastrous energy technology. The discovery in the 1990s of natural gas - a form of fuel that still meets 80 per cent to 90 per cent of Egypt's energy needs - made "going nuclear" seem too costly by comparison.
Lately, increasing demands for energy have all but silenced concerns over cost and safety that for years slowed Egypt's nuclear plans. Now, Egypt joins a number of Middle Eastern nations - indeed, countries throughout the world - in a kind of nuclear renaissance for which energy experts and nuclear industry executives have been waiting.
"We don't have any other forms" of energy, said Mounir Megahed, who retired in April as the vice chairman of Egypt's nuclear power plants authority. "We have very small reserves of oil and our natural gas reserves will probably be completed within 30 years or so. And we have no coal."
While Egypt was never an energy juggernaut on the same order as the UAE, it once claimed generous amounts of oil and natural gas. In the past decade, those resources have been depleted even as Egypt's population expands and its economy industrialises, taxing what few resources the country has left.
Yassin Ibrahim, the executive chairman of Egypt's nuclear power plants authority, estimates the country will run out of natural gas within 20 to 40 years. The country's oil resources may expire even sooner, perhaps within 15 years, he said.
The dwindling resources could have a devastating effect on Egypt's economy, but atomic energy proponents say switching to nuclear dovetails nicely with other energy goals.
Egypt's government has set a target date of 2020 for the country to derive 20 per cent of its energy from renewable sources. Those sources will include the existing High Aswan Dam, a significant source of hydro-power, as well as several wind and solar projects. Mr Ibrahim said he expects Egypt to harness 7,000 megawatts of electricity per year from wind power alone by 2020.
"I personally consider burning oil in the 21st century as a crime. We are now mature enough to maximise our energy mix," said Ibrahim al Oseiry, a former IAEA official and an energy and nuclear affairs consultant in Egypt's ministry of energy and electricity. "Before, for example, we used wood to get energy. Now no one is using wood. Then they started to use coal and then they started to use oil. Now, in the 21st century, it is a crime to burn oil when we have other energy resources."
On the other side of the environmental argument for nuclear power is the demand for fresh water. Egypt's growing population, as well as the rising needs of upstream nations such as Sudan and Ethiopia, have made desalination an increasingly attractive alternative source of fresh water.
The energy-intensive process of reverse osmosis is particularly well-suited to the clean and reliably constant excess energy produced by nuclear power plants. Egypt hopes to have four nuclear-powered desalination plants in operation by 2025, Mr Ibrahim said.
But before Egypt attempts to increase its energy capacity through nuclear technology, it must first focus on the ability of its own engineers and technicians to maintain and operate the plants.
That may be difficult for a country where some 40 per cent of the population is illiterate. Most Egyptians appear to know little or nothing about nuclear energy. But unlike energy consumers in the West, many Egyptians seem blissfully unaware of the technology's potential risks.
"It's not a bad thing. We are not a backward country, so we should catch up with our times," said Mohammed Ahmed, 56, a grocery store employee in the middle-class Cairo suburb of Agouza.
Mr Ahmed admitted, however, that he was unfamiliar with the concept of nuclear energy and had never heard of the 1986 Chernobyl accident. Scientists and "people with big brains" are better situated to ponder such decisions, Mr Ahmed said. "Egyptian people are average people. Average people think about their livings and their food, not their energy."
As it stands, said Mr Ibrahim, Egypt does not have enough native expertise to operate several nuclear facilities. Until it does, Egypt will hire foreign experts while waiting for Egyptian engineers to learn on the job.
"Here in Egypt we have limited energy resources but we have a lot of human resources. It's our plan to operate our nuclear power plant after training these people and qualifying them according to international norms," Mr Ibrahim said. "The key element is human resources. Without knowledgeable human resources, you cannot do anything. If you do have them, only then can you succeed."
mbradley@thenational.ae
Graphic on nuclear aspirations in the region
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The Gandhi Murder
- 71 - Years since the death of MK Gandhi, also christened India's Father of the Nation
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At a glance
Global events: Much of the UK’s economic woes were blamed on “increased global uncertainty”, which can be interpreted as the economic impact of the Ukraine war and the uncertainty over Donald Trump’s tariffs.
Growth forecasts: Cut for 2025 from 2 per cent to 1 per cent. The OBR watchdog also estimated inflation will average 3.2 per cent this year
Welfare: Universal credit health element cut by 50 per cent and frozen for new claimants, building on cuts to the disability and incapacity bill set out earlier this month
Spending cuts: Overall day-to day-spending across government cut by £6.1bn in 2029-30
Tax evasion: Steps to crack down on tax evasion to raise “£6.5bn per year” for the public purse
Defence: New high-tech weaponry, upgrading HM Naval Base in Portsmouth
Housing: Housebuilding to reach its highest in 40 years, with planning reforms helping generate an extra £3.4bn for public finances
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
How to join and use Abu Dhabi’s public libraries
• There are six libraries in Abu Dhabi emirate run by the Department of Culture and Tourism, including one in Al Ain and Al Dhafra.
• Libraries are free to visit and visitors can consult books, use online resources and study there. Most are open from 8am to 8pm on weekdays, closed on Fridays and have variable hours on Saturdays, except for Qasr Al Watan which is open from 10am to 8pm every day.
• In order to borrow books, visitors must join the service by providing a passport photograph, Emirates ID and a refundable deposit of Dh400. Members can borrow five books for three weeks, all of which are renewable up to two times online.
• If users do not wish to pay the fee, they can still use the library’s electronic resources for free by simply registering on the website. Once registered, a username and password is provided, allowing remote access.
• For more information visit the library network's website.
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Rating: 4/5
