Muscat – Gulf Cooperation Council Interconnection Authority (GCCIA) and Qatar Fund for Development (QFD) have signed a landmark financing agreement worth US$100mn to build overhead transmission lines to connect Oman with the GCC network.

The 530km, 400kV transmission line will connect Al Sila Station in the UAE to Ibri Station in Oman, with total capacity of 1,700MW and net transfer capacity of 1,200MW, strengthening regional energy integration and sustainability. The project includes development of two 400kV substations – one in Ibri and another in Al Baynunah.

The signing ceremony took place on Thursday in Muscat under the patronage of H E Salim Nassir al Aufi, Minister of Energy and Minerals.

The agreement paves the way for a transformative direct grid connection project linking the GCCIA network with Oman at a total cost exceeding US$700mn.

The agreement was signed by Ahmed Ali al Ebrahim, CEO of GCCIA, and Fahad Hamad al Sulaiti, Director-General of Qatar Fund for Development.

The project represents a significant step towards seamless integration of Gulf power grids – a strategic priority aimed at enhancing regional energy network connectivity, improving grid reliability and promoting sustainable electricity systems. It aligns with global efforts to develop resilient energy infrastructure and advance sustainable development goals.

It is expected to yield substantial benefits for Oman and the GCC nations. By unlocking additional power generation capacity, it will reduce the need for costly new power plants. Additionally, it will facilitate and enhance electricity exchange between GCC nations and Oman, fostering greater flexibility and resilience within regional power networks.

Operational costs are also expected to decrease significantly, as the interconnected network will lower operating expenses of participating nations, leading to considerable annual financial savings. Furthermore, the project will contribute to reducing carbon emissions, directly supporting global environmental conservation efforts.

Underscoring the strategic importance of the agreement, H E Aufi positioned it as a key component of Gulf energy integration policies. He highlighted the project’s role in bolstering energy security and sustainability, noting its alignment with broader GCC initiatives to develop a reliable and high-performing energy infrastructure.

Mohsen Hamad al Hadrami, Undersecretary in Ministry of Energy and Minerals and Chairman of GCCIA’s Board of Directors, described the electrical interconnection project as a cornerstone of the vital infrastructure initiatives endorsed by GCC leaders.

GCCIA’s Ebrahim informed that construction is scheduled to commence in the second half of 2025, with commissioning planned for the first half of 2027.