Middle East business intelligence service MEED has reported that South Korea’s Hyundai E&C has offered a low bid of $446.8m for the contract to build a 900km overhead transmission network linking the national electricity grids of Saudi Arabia and Egypt.

Hyundai E&C’s offer is around 0.5% lower than the second-lowest bid of $449.4m, which was submitted by the Saudi Arabia-based National Contracting Company.

MEED understands the bids were submitted on 9 September and opened the same day. Other bidders and their prices include Alfanar (Saudi Arabia) for $624.8m, the National Petroleum Construction Company (UAE) for $522.2m and Larsen & Toubro (India) for $501.7m.

The scheme comprises a 500kV transmission line extending 900km and passing through Saudi Arabia’s Medina and Tabuk regions then on to the Gulf of Aqaba. The overhead transmission line network is split into three lots extending 227.79km (Medina), 336.04km (Tabuk) and 335.96km (Gulf of Aqaba).

The transmission network is part of a $1.6bn scheme to interconnect the two countries’ national electricity grids.

A major new report from MEED looks at how the global shift away from fossil fuels is reshaping energy policy in the Middle East and North Africa, and its impact on business and project investment.

Another tender has been raised for the contract to implement several substations as part of the project. Two consortiums have submitted a proposal in early May to design and build four substations, with an estimated budget of $1bn, to be located in both countries.

MEED reported a Chinese-led consortium and a team comprising Japan’s Hitachi, Egypt’s Orascom and Saudi Arabia’s Saudi Services for Electromechanic Works submitted a bid for the estimated $1bn contract.

Egypt is expected to fund about 40% of the total interconnection project, with Saudi Arabia scheduled to pay for the remaining total. The project aims for the daily exchange of 3GW of electricity at peak times.

Discussions for an energy exchange infrastructure between the two countries began in 2010, with initial negotiations agreed upon four years later.

In March 2015, Islamic Development Bank signed an agreement with Egypt’s International Cooperation Ministry for a $200m loan to help finance the power link. The Arab Fund for Economic & Social Development and the Kuwait Fund for Arab Economic Development have also agreed to provide additional funding.