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Saudi needs SR350b investment in water and electricity sectors

JEDDAH — Saudi Arabia will need nearly SR350 billion in investment for water and sewage projects and SR340 billion for electricity projects during the next 20 years, according to Water and Electricity Minister Abdullah Al Hussayen.

He said that the water and electricity sectors in the Kingdom were growing at the rate of seven percent. The Supreme Economic Council, (SEC), chaired by Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz, has approved four IWPPs (Shuaiba-3, Shuqaiq-2, Ras Al-Zour, and Jubail-3), at a total cost of nearly SR30 billion, which would be carried out by the private sector on a build, operate and transfer (BOT) basis.

The private sector will contribute 60 per cent of the cost while the state-owned Public Investment Fund (PIF) will have 32 per cent stake and Saudi Electricity Company (SEC) eight per cent. Al Hussayen said that Shuaiba-3, located 110 km south of Jeddah on the Red Sea coast, is the Kingdom's first privatised IWPP. It would supply 194 million gallons of water daily as well as 900 megawatts of electricity. Work on the project started on Jan. 21, 2006 and its first unit will begin production on Oct. 13, 2008.

He added that Jeddah's water problem would be solved within two years with the supply of 1.3 million cubic metres of water from desalination plants in Shuaiba on the Red Sea. Shuaiba-3 will supply about 550,000 cubic metres of water to Jeddah when it is ready by the end of next year, and the per capita water share in the city would increase to 350 litres daily.

Al Hussayen said that it is planned to establish a new desal plant in Jeddah with a daily capacity of 200,000 cubic metres. He estimated the amount of recycled water in the city at 350,000 cubic metres daily. "Three treatment plants are being built with a capacity of 240,000 cubic metres of purified water each daily," he added. He recalled that the Kingdom signed a SR9.1-billion contract in November 2005 with a consortium of Saudi and Malaysian companies to set up Shuaiba-3 desalination plant. The combined production capacity of the four projects will reach 492 million gallons daily and 4,500 megawatt of power. "These projects will boost the total desalination capacity of the Kingdom by 80 percent," Al Hussayen said.

Water & Electricity Company (WEC) will sell 100 per cent of the water produced by these plants to the Saline Water Conversion Corp. (SWCC) and 100 per cent of their power supply to the Saudi Electricity Company. A group of local and international banks are financing Shuaiba-3.