Korea Midland Power Seeks New Growth in Middle Eastern Sunshine... Expanding Overseas Renewable Energy Operations

Targeting the Middle East with the Ibri 3 Project in Oman

Expanding Solar and BESS Business Foundations

Overseas Expansion Focused on the Middle East

Leveraging Construction and O&M Experience

Aerial view of Ibri 3 solar power plant in Oman. Korea Midland Power Co.

Korea Midland Power Co. is expanding the reach of its overseas renewable energy business, particularly focusing on the Middle East. The company is moving beyond domestic power generation to broaden its operations into solar, wind, and battery energy storage systems (BESS), seeking new growth opportunities abroad.

According to Korea Midland Power on September 18, the company is positioning the Middle East as a key hub for its overseas renewable energy business and diversifying its business portfolio. The most representative project is the Ibri 3 solar power project in Oman. Leveraging experience gained in the construction and operation of both domestic and international power plants, Korea Midland Power is participating in local solar projects, strengthening its foothold in the Middle Eastern renewable energy market.

The Ibri 3 project involves building a 500MW solar power plant and a 100MWh BESS in Ibri, Al Dhahirah Governorate, Oman. This is Oman’s first utility-scale project combining solar power generation and large-scale energy storage facilities. Korea Midland Power is participating as part of a consortium with Masdar, a renewable energy company based in the United Arab Emirates (UAE), Oman Alkadra Partners, and OQ Alternative Energy.

The total project cost stands at approximately 300 million US dollars. The consortium signed a Power Purchase Agreement (PPA) with Oman Power and Water Procurement Company (Nama PWP) in September last year and achieved financial close in January this year. Natixis, a French financial institution, and First Abu Dhabi Bank (FAB) are providing a significant portion of the construction financing.

Once the plant begins operations, it is expected to generate enough electricity to supply approximately 33,000 households and reduce annual carbon dioxide emissions by about 505,000 tons. The Omani government is also designating this project as one of its flagship initiatives for national energy transition. Oman has set a target to increase the share of renewable energy in its electricity generation mix to 30 percent by 2030 as part of its Vision 2040 plan.

The Middle East is a market where large-scale solar projects are being promoted in succession, thanks to abundant sunlight and vast available land. Oil-producing countries are expanding their investments in renewable energy in order to reduce dependency on oil and gas and diversify their industrial structures. As a result, global energy companies such as Masdar, ACWA Power, and TotalEnergies are fiercely competing for new projects. In fact, in the bidding process for Ibri 3, companies from Korea, the UAE, Saudi Arabia, China, France, and Japan all participated in the competition.

Korea Midland Power’s overseas business strategy is shifting accordingly. Whereas independent power production (IPP) projects based on fossil fuels once played a major role in its overseas operations, the company is now expanding to zero-carbon power sources including solar, wind, and BESS. This shift reflects efforts to respond to the global carbon neutrality movement and, at the same time, to secure new long-term revenue streams through overseas business.

In particular, BESS is becoming increasingly important in the expansion of renewable energy. By storing the electricity generated from solar and wind plants—which fluctuate with weather conditions—and supplying it during periods of peak demand, BESS helps address output variability. Domestically, Korea Midland Power is also pursuing a BESS project with 96MW generation capacity and 576MWh storage in Haenam, Jeollanam-do. The company is investing approximately 150 billion won to build and operate the facility over the next 15 years. These experiences in constructing and operating BESS in Korea are expected to serve as a foundation for linking such expertise to its overseas renewable energy projects.

Due to the long-term nature of power projects, from construction through operation, securing overseas projects can provide a sustainable source of revenue over the mid- to long-term. For Korea Midland Power, this not only means responding to changes in the domestic power market but also securing new business foundations abroad.

However, there are a number of challenges that must be addressed in overseas renewable energy projects. Factors such as geopolitical uncertainty in the Middle East, the prices of key equipment like solar modules, exchange rate fluctuations, and changes in interest rates can all affect project costs and profitability. Large-scale projects are time-consuming, from development and financing to construction and operation; thus, risk management after project acquisition, in addition to securing contracts, plays a critical role in ensuring success.

Korea Midland Power aims to ensure the smooth progress of overseas projects such as Ibri 3 while continuing to expand its business areas into solar, wind, and BESS. By combining its existing expertise in power plant construction and operation with capabilities in renewables and storage systems, the company plans to foster its overseas eco-friendly energy business as a new growth axis.

This content was produced with the assistance of AI translation services.