The Worldfolio sits down with H.E. Eng. Hala Adel Zawati, Jordan’s Minister of Energy and Mineral Resources, to discuss the National Energy Strategy, efforts to develop upstream, downstream and renewable energy capacities, and the Ministry’s Rare Earth Elements Project.
What are the main pillars of the updated National Energy Strategy, and how will it influence Jordan’s energy sector?
We are currently working with the participation of all stakeholders from both the public and private sectors to prepare Jordan’s National Energy Strategy for 2030, with a vision for 2050 in mind. This Strategy is built on four main pillars: energy security, increasing energy independence, reducing cost, and diversifying energy resources. When we talk about energy security, it is important to talk about local energy resources. We have been and will continue to work towards increasing locally generated energy. Today, around 10% of electricity in Jordan is generated from renewables and we expect this figure to double by 2020. To do so, we are reinforcing our grid and developing our Green Corridor project. This will allow us to accommodate more green energy. With the completion of this project, the grid will be able to take 1,200MW of additional renewable energy. We also plan to establish an Eastern Corridor to utilize more renewable energy, particularly solar from the northeast part of Jordan. In addition to grid expansion and reinforcement projects, Regional Grid Connection initiatives are being undertaken with Iraq and Saudi Arabia in order to stabilize the grids and exchange electricity. Another aspect of addressing energy independence and increasing security is energy storage. We have announced a call for proposals for a storage project that already has proposals from 10 reputable companies that we are assessing. Soon, we hope to announce the winning proposal. We have also been working on the pre-feasibility for pump storage. This is about storing the extra electricity generated during the day from renewables, or during times of low electricity demand, excess energy is used to pump water to an upper reservoir. Then during periods of high electrical demand, the stored water is released through turbines to produce electric power (the so-called hydropower generation). We have already allocated three dams in Jordan for this and are currently doing a full feasibility study on one of these dams. We will soon announce for direct proposals for this project. Beyond electricity, for the past two years, we have been diversifying our gas imports. In mid-2018, we were fully dependent on LNG via the port in Aqaba, today we have started to diversify our resources with Egyptian gas. On marketing and downstream oil products, Jordan currently has three oil marketing companies: Manaseer, Total and Jordan Petroleum Products Marketing Company Ltd (JoPetrol); however, we have announced our intention to license two more companies to increase the number of competitors and create greater security for the sector.
Another very important and strategic project in the Oil Sector is the Iraqi Oil Pipeline. This project will allow the export of Iraqi crude oil via Gulf of Aqaba and also will enhance the security of energy supply through providing Jordan of its need of crude oil. The agreement will give Jordan priority to get 150,000 barrels per day (bpd), while the pipeline capacity will be 1 million bpd.
How are the oil and gas exploration activities progressing in the Kingdom?
Within oil and gas exploration, we are intensifying our efforts in three main areas: upgrade and develop Risha Gas Field to improve gas production. Today, we are producing around 10 million cubic feet (mcf) of gas per day with hopes to double that by YE2019. But even 20mcf is not that much if we compare it to Jordan’s current consumption of more than 330mcf of gas per day. Oil and Gas Explorations: we have identified six areas in Jordan where we believe there could be oil: Jafr, the North Highlands, West Safawi, Rum, Petra, and the Dead Sea. We have announced these areas as open exploration blocks, and two of them have been taken by one of the companies for further studies. The door is still open for direct oil and gas exploration proposals for the remaining four blocks. The third area is oil shale, we have four oil companies working in Jordan, including Shell, which is experimenting its unique in situ conversion process. There are three other companies working in surface retort exploration.
In addition to licensing two additional oil marketing companies, what are the newest updates in Jordan’s downstream oil industry?
When we talk about downstream, it is important to mention Jordan Petroleum Refinery Company (JPRC). The refinery is operating on a commercial basis today and is looking at its fourth expansion, for which it seeks to raise funds. This expansion is an important strategic project for Jordan; it will allow the refinery to improve its products, most of which go to the local market. Moreover, the refinery has started to export some of its products, so the upgrade and expansion is also important for Jordan to be able to export more value-added petroleum products. We hope JPRC is able to secure the financing it seeks and start work on the anticipated expansion.
What are the ministry’s key activities and priorities in terms of mining?
Mineral resources are extremely important to Jordan, and perhaps we have not given them enough attention. Over a year ago, the Ministry started to develop the Rare Earth Elements Project. It aims at studying several rare elements that are present in Jordan to determine the location, size, and commercial viability of these deposits. Initial results showed that many of these rare earth elements are commercially viable. Accordingly, we are working now on preparing some investment packages for these elements. We are also interested in downstream industries that will add value to exported products. We continue to export phosphate and potash and continue working with downstream industries. We are also today exploring the availability of copper and gold hoping that the studies will convert to mining opportunities.
Are there any other areas within energy and mining that the ministry is focusing on during 2019?
The energy sector is extremely important to all other sectors. Energy is a cross-sectorial issue and today our highest priority is to bring costs down to enable economic growth and allow Jordanian products and services to be more competitive. This is one of the most important pillars in our strategy. Other areas the ministry is focusing on are :
This year we have also launched a new initiative to install solar systems to generate electricity for poor families benefiting from the national Energy Fund. There are 100,000 families, we intend to supply 7,000 families per year and hope to increase the funding to allow for more.