A major interconnection project linking six Gulf states has got underway with the award of a $220 million contract from the Gulf Cooperation Council Interconnection Authority (GCCIA).

The project will be carried out in three phases with phase one linking the transmission systems of Saudi Arabia, Bahrain, Qatar and Kuwait requiring about 850 km of high-voltage transmission line and an underwater cable between the east coast of Saudi Arabia and Bahrain.

The new contract has gone to Swiss-Swedish conglomerate ABB for the delivery of six turnkey 400 kV gas-insulated substations, including gas-insulated switchgear, circuit breakers, transformers and shunt reactors.

ABB will be responsible for design and manufacturing of the equipment, system engineering, installation, commissioning and civil works. Work will start immediately and is due to be completed by January 2009.

The contract is ABB’s largest single order for 2005 and one of the largest substation orders ever won by the company.

Phase two of the massive Gulf Grid project will link the United Arab Emirates with Oman, and all states will be linked up in the final phase.

The power grid project, first announced in January, is expected to help GCC member states to trade electricity, utilise surplus capacity and improve reliability. The project will see the creation of the region’s first cross-border grid with the first phase providing Saudi Arabia and Kuwait with quotas of 1,200 MW each, Qatar with 750 MW and Bahrain with 600 MW.

According to GCCIA, the payback period for the investment of about $1 billion is less than four years