Sary-Arka Gas Transmission Pipeline - Project: Review and analysis, Preparation Study

Project ID: 73498

Project title and assignment: Sary-Arka Gas Transmission Pipeline - Project: Review and analysis, Preparation Study

Contract description: The main purpose of this assignment is to carry out a detailed review and analysis of the Sary-Akra Gas Transmission Pipeline Project and prepare a study at a level sufficient for the Bank and possible other financing institutions to make a decision regarding the finance of the Project (the Assignment) The study will cover all technical, market and financial aspects of the Project and will propose a viable Project Implementation Plan (PIP), including a Procurement Plan in line with the Bank’s procurement rules.

The main objectives are to:

· Perform the gas demand forecast analysis and identify the additional gas distribution infrastructure that will be necessary to be implemented in parallel with the Project; and

· Prepare a Bankable Project Study, including a detailed profitability analysis.

Provided services:

· Perform a detailed technical review and analysis of the Project within the environment and infrastructure where the new pipeline will be built;

· Perform an analysis of the gas demand forecast and of the necessary additional gas infrastructure that will be needed to be built in parallel with the Project in order to bring the gas to the final consumers; and

· Prepare a project profitability analysis for the gas transmission pipeline project based on the updated investment cost, the two gas demand scenarios and reasonable assumptions regarding tariffs.

Scope of Work:

Task A: Detailed Project Review

· Review, analyse and opine on the existing project documentation and plans, including technical and economic studies, data and assumptions;

· Review the feasibility study (TEO), the basic design and environmental impact analyses performed on behalf of KTG and confirm appropriateness and if needed propose improvements that will ensure the project will be implemented in line with prudent industry standards and international best practices and will be eligible for financing by EBRD and possible other MDBs;

· Review, analyse and if needed propose improvements on the technical characteristics and technologies that will be used for the Project, including pipeline routing, size, compressor stations, SCADA and auxiliary systems and operational modes and parameters. Special focus will be given to improved energy efficiency technologies in the compressor stations and the monitoring and control of fugitive emissions;

· Review, advise and if needed propose improvements on the appropriateness of investment cost estimates, time-schedules and project implementation plans (PIP).
Task B: Analysis of gas demand and necessary additional infrastructure

This will be an analysis of the gas demand forecast and of the necessary additional gas infrastructure that will be needed to be built in parallel with the Project in order to bring the gas to the final consumers. The Consultant will:

· Review and analyse the present maximum potential of gas demand at 100% fuel switch to gas from other fuels per consumer category (domestic, commercial, industrial and CHP) of the regions where the new pipeline will go through, including Astana, Kyzylorda, Zhezkazgan and Karaganda;

· Develop two scenarios of gas penetration to the energy market of these regions, one pessimistic and one optimistic, with the related gas volumes per consumer category and a long term time horizon based on current economic development forecasts of the country and the regions;

· Develop plans and investment cost estimations for the necessary additional gas infrastructure in gas distribution networks and connections to large consumers that will be needed to be constructed in parallel with the transmission pipeline in order to deliver gas to the final consumers;

· Develop detailed estimations of the expected carbon emissions reductions that will be realised from the fuel switch from higher carbon intensive fuels to gas for both scenarios of gas penetration in the energy market of the affected cities and regions.
Task C: Preparation of Bankable Project Study

Based on the updated investment cost, the two gas demand scenarios and reasonable assumptions regarding tariffs, the Consultant will carry out a project profitability analysis for the gas transmission pipeline project. To this end, the Consultant will carry out the following activities.

· Prepare a Project basic technical analysis with main technical specifications and breakdown of investment cost estimation within an accuracy of +/- 15%;

· Perform a detailed cash-flow profitability analysis with clear assumptions and appropriate sensitivity analyses taking into account current energy prices levels and appropriate environmental externalities, especially for the expected reductions of the GHG emissions and the reduction of local pollutants that will be the result of the fuel switch to gas;

· Propose a Project Implementation Plan (PIP), including a procurement plan in line with the Bank’s procurement requirements and rules.

Duration: 5 months