Saudi Arabia Signs Contracts Worth $4.2 Billion for Ras Az Zawr Power and Water Desalination Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--Abdullah al Hussayen, Saudi Arabia's Water and Power Minister, has signed contracts totaling $4.2 billion covering the construction of the Ras Az Zawr power and water desalination plant on Saudi Arabia's Gulf coast, following the awarding of contracts in September this year. The plant will operate from waste heat generated at the aluminum complex being built by Saudi Arabian Mining Company (SAU:1211) (Ma'aden) (Riyadh, Saudi Arabia) and Alcoa Incorporated (NYSE:AA) (Pittsburgh, Pennsylvania).

The contracts were signed by the minister on behalf of the government owned Saline Water Conversion Corporation (Riyadh, Saudi Arabia) in his position as chairman of the company.

A group, led by the local Al-Arrab Contracting Company Limited (ACC) (Riyadh, Saudi Arabia) and including China's SEPCO111 Electric Power Construction Corporation (Qingdao, China), will build the power plant, which will have a design capacity of 2,400 megawatts (MW) but will be able to generate 2,750 MW of electricity.

The contract for the power plant is reported to be worth $2.4 billion and the power facility is expected to be completed within 42 months, according to ACC's Executive Vice President, Samer Arafa.

The water desalination plant at the complex will be constructed by a consortium consisting of Korea's Doosan Heavy Industries and Construction Company (SEO:034020) (Gyeongsahngnam, South Korea) and Saudi Archirodon Limited (Jeddah, Saudi Arabia), which is the local arm of the Netherlands-based Archirodon Group NV (Dordrecht, Netherlands).

The desalination plant will produce up to 1.025 million liters of water each day, making it the world's largest desalinization plant when it is completed in 2014. Originally, Doosan indicated the contract for the desalination plant was worth $1.46 billion, but reports place the contract value now at $1.7 billion.

The majority of the desalinated water produced from the complex will be taken by SWCC, while the electricity produced will be shared between the state-controlled Saudi Electricity Company (SAU:5110) (SEC) (Riyadh, Saudi Arabia), which will take 1,050 MW and Ma'aden, which will take 1,350 MW.

Ma'aden and Alcoa are jointly constructing the world's largest fully integrated aluminum complex at Ras Az Zawr, worth an estimated $10.8 billion, and scheduled for completion in 2014.

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