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Global megaprojects – Ireland and Egypt as successful showcases

In 2015, Egypt declared war on power failures, and awarded Siemens its biggest contract of all time. The mission: generate power to serve 40 around million people. A glance back at history shows that Siemens has always been the right partner for fast, reliable completion of such megaprojects.

How megaprojects get built

Ireland – Birth of an idea

When Ireland gained its independence in 1922, most of the country still had no electricity. Apart from a few major cities like Dublin and Cork, the country was “totally untouched, electrically speaking.” The entire capacity of all public electric power plants came to about 27,000 kilowatts (kW). So at that point, economic development in the Irish Free State (now the Republic of Ireland) lagged far behind the other Western European countries. It was high time for a change.

The initial situation looked none too promising. The Free State had hardly any coal deposits of its own. In the search for alternative energy sources, Irish physicist and electrical engineer Thomas McLaughlin – a Siemens employee, who had been with Siemens-Schuckertwerke (SSW) in Berlin since the end of 1922 – realized Ireland had a hitherto almost untapped super-resource: domestic hydroelectric power. More precisely, his idea was to use the River Shannon, some 370 kilometers long, to electrify the entire country and contribute to its economic development. The territory to be supplied had a population of about three million at the time, and at roughly 70,000 square kilometers was about the same size as Bavaria.

Ultimately, a 358-pages project plan from Siemens won the Irish Free State over. A short time later, on August 13, 1925, the “Shannon Agreement” was signed. Siemens-Schuckertwerke would be the general contractor and supply the electrical equipment.

Putting Egypt on the way to energy efficiency

Around 90 years later, Egypt is faced with a similarly daunting task. With about 99.6 percent of the population connected to the grid, Egypt has Africa’s highest level of energy supply. But in 2010, the most heavily populated Arab state faced a severe energy crisis. The main source of trouble was not a shortage of fossil fuels, but economic and regulatory factors. After 2011, political, economic and social uncertainty prevailed, and by the beginning of 2013, the country’s foreign currency reserves had fallen to their lowest level ever, 13 billion US dollars. Consequent financing bottlenecks caused domestic natural gas production to collapse. Egypt had been struggling for years with unpredictable waves of power failures – in a country where the population was growing by an explosive two percent per year, and was thus likely to be consuming more and more electricity.

Time to act. So in 2015 the decision was made to face up to the challenges. Nothing less than then future energy supply of the entire country stood high on the national agenda. A strong partner with extensive experience in megaprojects was needed: Siemens. That June, a contract was signed between Egypt, Siemens and the Egyptian consortium partners Elsewedy and Orascom. It covered the construction and turnkey handover of the three combined-cycle power plants at Burullus, New Capital and Beni Suef with a combined output of 14.4 gigawatt, as well as twelve wind farms, with a projected 600 wind turbines and an installed capacity of two gigawatts - the biggest order in Siemens history to date. 

From vision to reality

A new Ireland

Over the course of the 52-month Irish megaproject, it became increasingly obvious what a massive organizational and technical challenge it posed for all involved.

Factors like the country’s damp climate, troublesome soil conditions and geological formations repeatedly interfered with the progress of the digging work. A further complicating factor was that Ireland had almost no construction industry worth mentioning. Which meant that many of the roughly 3,500 workers – who at the government’s request were mostly recruited domestically – had little experience with civil engineering. Almost all the machinery and materials even had to be shipped from the mainland to Ireland on specially chartered steamers. The construction machinery and equipment alone came to some 30,000 metric tons.

Yet little by little, the big project on the River Shannon arose. The river supplied the entire Irish Free state with electricity by way of a grid designed for 110 kilovolts (kV), 37.5 kV and 10 kV, with a total length of 3400 kilometers and a great many switching points and transformer stations – just as Thomas McLaughlin had envisioned. That success story still lingers in memory not just at Siemens, but among the local population of Ireland today.

The strength of a promise

And Siemens is making history again in 2018. On completion, those three combined-cycle power plants in the Egypt megaproject will be the highest-capacity units in the world. And no wonder – more than 43,500 workers there are laboring on a plant that covers the area of more than 300 soccer fields.

Jointly with Orascom Construction and Elsewedy Electric, Siemens is playing a significant role in ensuring a solid financing of the 6-billion-dollar deal with the Egyptian government.

Meanwhile the construction phase has posed a number of logistical problems. Similarly to Ireland, here one sometimes has to cope with poor soil conditions, a shortage of skilled personnel, and difficulties with transporting materials. Fishing ports are being expanded to provide reliable shipping routes and housing is being built for staff.

Even the weather can sometimes call work to a halt. Instead of the 2,800 foundation piers originally planned, 18,400 had to be sunk to stabilize the boggy ground under the construction site. But none of these difficulties kept the team from completing the project successfully, as Peter Ullrich, Siemens’ overall project leader for the Egyptian megaproject, proudly announced: “Together we’re making the impossible possible – and we’re still on schedule.”

It remains to be seen whether the megaproject on the Nile – like Shannon – will be remembered by the country’s population even 100 years later. For now, it looks like that.

The Egyptian people can count on Siemens. This was true more than 150 years ago, when Siemens first started working in Egypt and it remains our commitment today.
Joe Kaeser, former Siemens CEO

Sham Jaff | Sabine Dittler

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