Project assistance completion report : Hurghada gas turbine refurbishment

The project was a component of the Power Sector Support Project I. The main counterpart agency was the Egyptian Electricity Authority (EEA). The successfully completed project added an additional 85 MW of generating capacity to the EEA generation system (allowing for reduced capacity due to high ambient summer temperatures). Initially, this power was available only to meet the steadily increasing demand from new developments in the Hurghada area; since 1998, the latter has been connected to the Unified Power System (UPS) and now draws its power from the national grid. The six renovated 24 MW gas turbines at Hurghada (five financed by USAID and one by EEA) are currently used only on a standby basis, since they have not yet been connected to the natural gas system, and, using solar energy, are more expensive to run than are turbines that use natural gas. However, EEA has applied for a natural gas connection for this plant. To make this economically feasible, it plans to move an additional 6 turbines to Hurghada and convert all 12 to combined cycle operation. The addition of one or more heat recover steam generators to the system will boost power output by 50% with no additional fuel requirements. The resulting power plant will have an operating output of approximately 300 MW and will be available to the entire country (and for export) through the UPS. The project provided the least-cost solution to the shortage of EEA electrical generating capacity in the Hurghada area. EEA was able to utilize surplus generating equipment from other parts of the country to satisfy growing demand in Hurghada's rapidly developing tourist area at about half the cost of constructing a totally new plant of the same capacity. EEA's participation, through its in-house construction contractor and the use of its own labor and craft workers for the turbine move and refurbishment, resulted in considerable cost savings over the use of offshore contractors. EEA also gained considerable experience, which it will put to use during the next phase of expansion at the Hurghada power plant. In addition, EEA personnel received training in the United States and onsite in the operation of the upgraded plant. Lessons learned are as follows: (1) In future projects, the initial in-situ survey of the turbine units should include partial disassembly to ensure that the list of replacement and repair parts accurately reflects the condition of the units. The expenditure of additional time at this stage will avoid later delays caused by waiting for the delivery of offshore parts and equipment. (2) The process of dismantling and transporting the turbines to their new location needs to be more closely monitored and controlled. Parts removed from the main unit prior to transportation should be tagged and containerized, and remain in the container until required. Some parts were lost in transit and additional costs were incurred in replacing them. (3) EEA's use of its own civil works contractor resulted in considerable cost savings. If used again, however, this model should be implemented under a traditional construction contract package containing commercial terms and conditions, schedules, technical specifications, drawings, and quality control and testing requirements. In the absence of these, K&M, the technical services contractor, had to interpret local engineering and construction practices in order to monitor and accept the work performed. (4) Detailed project scheduling responsibilities were not clearly defined in either the GETSCO or Hydelico contract. Without such schedules, the control and coordination of the overall project is not possible. (Author abstract, modified)