GE wins $1 billion Saudi power plant contract

GE has been awarded a contract worth almost US$1bn (Dh3.7bn) to design and build gas turbines for a new power plant at Waad Al Shamal in northern Saudi Arabia. The combined cycle power plant is being built for Saudi Electricity Company and will support the development of the $7.5bn phosphate mining complex under construction for […]

GE has been awarded a contract worth almost US$1bn (Dh3.7bn) to design and build gas turbines for a new power plant at Waad Al Shamal in northern Saudi Arabia.

The combined cycle power plant is being built for Saudi Electricity Company and will support the development of the $7.5bn phosphate mining complex under construction for a joint venture between Saudi Arabian Mining Company, Maaden, The Mosaic Company and Saudi Basic Industries. Once complete, the complex will be one of the biggest integrated phosphate fertiliser production sites in the world.

GE said its 48-month contract involves the delivery of the power plant, including four heavy duty gas turbines and one steam turbine. It will produce 1,390 megawatts, which is enough to power more than 500,000 Saudi homes.

Most of the turbines will be manufactured in GE’s plant at Greenville in South Carolina in the US, but one will be assembled at GE’s new technology centre at Damman in Saudi Arabia’s Eastern Province. GE’s Middle East and North Africa president and chief executive of gas power systems, Mohammed Mohaisen, said: “Waad Al Shamal brings significant value to the Kingdom by strengthening the northern grid and through its potential to energise the local industrial sector. By installing a gas turbine that is fully assembled at GE’s centre in Dammam, we are delivering on our commitment to provide stronger localisation support to our partners.”

Ziyad Al Shiha, the chief executive of Saudi Electricity Company, said: “We continue to strengthen the Kingdom’s power infrastructure to meet the growing demand for electricity and to accelerate all-round growth.”

Last week, Saudi Arabia announced that transport and infrastructure spending in 2016 will be cut by 63 per cent as the kingdom responds to continued lower oil prices. Funding for projects has dropped to 23 billion Saudi riyals – down from 63 billion riyals in 2015.

In October, BMI Research had predicted that growth in the kingdom’s power generating capacity would slow as projects are delayed or cancelled. Growth in power generating capacity will peak at about 6.3 per cent this year as new projects come on line, but will fall to just over 5 per cent next year and 4 per cent in 2018, the company said.

“Certain projects – such as the Fadhili gas project – which are crucial to the Saudi energy sector will be realised but others will not,” BMI Research said.

mfahy@thenational.ae

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Source: Business

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