Components and solutions

Kuwait

TOGY talks to Herbert Klausner, CEO of Siemens Kuwait. The company has been active in Kuwait since 1959 and provides solutions and services related to all areas of infrastructure and the oil and gas industry.

Siemens has been working in the Kuwaiti market since the 1950s. In the power market, Siemens’ services cover power stations, high- and medium-voltage substations, power station and substation services, and digitalisation. In August 2016 the company provided power to high-voltage substations at the Mina Al Ahmadi and Mina Abdullah refineries. The work is part of Kuwait National Petroleum Company’s Clean Fuel Project.

• On challenges with power generation: “During the summertime, running such power stations is a very delicate and challenging task because of high temperatures. The temperature greatly decreases the efficiency of such engines. This is why we are using the best engines here, in particular the 2000E, which is a very robust machine that can burn almost everything. We also have more sophisticated engines available, such as the 4000F, which we are also using for new projects here.”

• On efficiency: “Siemens is investing heavily in new technologies, especially when it comes to power generation equipment. Our combined-cycle efficiency is more than 61%, which is exceptional. Using the right equipment with high efficiency also means reducing the consumption of oil and gas and securing resources that can be put to better use for other purposes. We will bring further ideas on saving natural resources here to Kuwait. ”

Besides touching on these topics, TOGY talked at length to Herbert Klausner about about his company’s activities in Kuwait, challenges facing the power generation sector and the importance diversifying in an industry mired in low oil prices. Most TOGY interviews are published exclusively on our business intelligence platform TOGYiN, but you can find the full interview with Herbert Klausner underneath.

Can you describe some challenges for the power generation sector in Kuwait?
Power consumption is steadily increasing in Kuwait. It is important that the country is coping with its increased demand. In the winter, consumption in Kuwait is roughly 6 GW. In June, consumption is 15 GW. You can imagine the challenge the Ministry of Electricity has in order to cope with this difference.
Additionally, during the summertime, running such power stations is a very delicate and challenging task because of high temperatures. The temperature greatly decreases the efficiency of such engines. This is why we are using the best engines here, in particular the 2000E, which is a very robust machine that can burn almost everything. We also have more sophisticated engines available, such as the 4000F, which we are also using for new projects here.

How can Siemens support the country’s strategy of reducing its reliance on oil income?
The most important strategy will be to diversify the existing GDP portfolio, which is heavily dependent on oil income. It is necessary to develop the country into an attractive place for foreign investments and focus on non-oil revenues.
Siemens is investing heavily in new technologies, especially when it comes to power generation equipment. Our combined-cycle efficiency is more than 61%, which is exceptional. Using the right equipment with high efficiency also means reducing the consumption of oil and gas and securing resources that can be put to better use for other purposes. We will bring further ideas on saving natural resources here to Kuwait.

What have been Siemens’ main activities in Kuwait?
Siemens Kuwait is a closed shareholding company. Over the last few decades, Siemens has brought in the latest technology in Kuwait that the company is manufacturing worldwide.
Our parent company has also made a lot of acquisitions in the past decades. One of the most recent ones was Dresser-Rand, a huge US company in the oil and gas business, which provides solutions for compressors and smaller industrial steam turbines.
Out of the 15 GW power generation available here in Kuwait, 3 GW is produced from our technology. This is one area where we are very strong because we are using very environment-friendly power generation. Our efficiency is high and emissions are very low, which contributes to environmental protection in Kuwait.

Can you give us an overview of the main projects Siemens Kuwait has been involved in?
We’ve been heavily involved in the Az Zour South combined-cycle project, which is 1.5-GW power station. We have eight gas turbines installed there. We also did a conversion of this power station in 2007 when we started this project.
Additionally, generating energy was one of the important projects that we did for Kuwait, converting our own self-built open-cycle gas turbine plant into a combined-cycle plant. Doing that has brought another 560 MW on board the grid.
The Ministry of Electricity and Water has the overall responsibility in distributing power, from its generation to the consumer. This is something that we have been very strongly involved in, and are still involved in. We have built more than 130 high- and medium-voltage substations here in Kuwait, and we have long-term contracts with the government to provide services.
We have our own expertise here in the country, which means that we are not only building substations and gas power plants, but we are here for the long term. In the long term, providing our expertise in the service business is a very crucial part of Siemens’ portfolio. Technology also changes over the years. It’s improving, and we are offering the complete services.
Siemens also provides the latest technology in healthcare equipment to existing hospitals here. Siemens is looking forward to other opportunities because there are a lot of projects coming up, especially in healthcare. We have all the technology that the new hospitals will need in our portfolio. Siemens provides this to Kuwait.
We are not only strong in healthcare and power generation, transmission and distribution, but also in oil and gas. If you talk about drives, if you talk about frequency converters, if you talk about any solutions and technology vital to key infrastructure, Siemens is there.

What will be the biggest area of growth for Siemens in the next five years?
We will continue to do what we’ve done in past years. Power generation and power distribution are the biggest, most important features in our portfolio that Siemens will look at in the future. Of course, we are also focused on investments upstream and downstream in the country.
Generally speaking, our portfolio is very broad. We try to address all of it in the market if it fits, and if it makes economic sense. It is not only about components; we sell solutions as well. The market, especially in oil and gas, is asking for solutions and Siemens is ready to sell ones that have been successful in other fields.

How will Siemens face future challenges, given the low oil price?
Siemens has a long history in Kuwait, and it is definitely not easy to continue down this successful path. We can do it. The oil price is quite low, and a lot of investments that were planned and were put on the agenda may not materialise, but we have to deal with these challenges.
The country and the companies operating here will have to spend money more wisely in the future and focus on important investments. Therefore, we as contractors and companies active here in Kuwait also have to sharpen our pencils and look into very cost-efficient offers that we can make to the government.
This is what we have always been looking for: the best quality for the best price in the market with the latest technology. We have been successful at this in the past, and this is what we will continue to do in the future.

For more information on Siemens in Kuwait, such as its work on the USD 12-billion Clean Fuel Project, see our business intelligence platform, TOGYiN.
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