New Compressor and Turbine Manufacture Plant Enlarges Siemens' Saudi Footprint

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Having already established a large footprint over the years in Saudi Arabia's energy sector, Siemens AG (NYSE:SI) (Munich, Germany) is now moving to deepen and broaden its presence in the country. At the beginning of May it took a major step forward with a groundbreaking ceremony for a manufacturing plant for gas turbines and compressors. The plant is scheduled for completion in late 2013.

The power equipment manufactured at the plant will be supplied to the local Saudi market, which is seeing a strong growth in demand. Siemens and its local partner, E.A. Juffail &Brothers (EAJB), will jointly invest what has been reported to be "a three-digit million U.S. dollar figure" in the facility, which will be constructed on a 220,000-square-meter site in Dammam in the eastern region. The project also will serve as a knowledge transfer hub for Siemens technology to support the Saudi industrialization drive, creating jobs for young Saudis.

The new site is designed to meet all requirements for sustainability and resource efficiency. The project is aiming for the "new construction" category of the international Leadership in Energy and Environmental Design (LEED) Gold Certification. It will score highly in water and energy efficiency, with water-saving fittings and highly efficient air-conditioning systems. Energy consumption is scheduled to be at least 20% lower than that used by a comparable building.

Last week, it was announced that Siemens had been awarded two contracts, together worth about $266 million, by the state-controlled utility Saudi Electric Company (SEC).

The first contract covers the supply of five gas turbines, which will generate 388 megawatts (MW) of power for the Rafha, Qurayyat and Arar areas. The second contract is a turnkey project for the construction of the Al Kharj substation; it covers the supply of all key components, plus construction. The project will enhance the reliability and security of the power supply, which is under pressure from growing demand in the region.

Siemens has operated in Saudi Arabia for more than 80 years with its partner EAJB. The company claims that its technology currently transmits and distributes 33% of power used in the country, already a large footprint.

For related information, see February 6, 2013, article - Saudis Tag $134 Billion for 49% Power Addition through 2019.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.