Saudi Arabia awards two wastewater contracts
27 November 2023
Saudi Arabia's National Water Company (NWC) has awarded two contracts for the construction of sewage networks in Dammam and Hail.
The first contract, worth SR371m ($99m), has been awarded to Alomaier Trading & Contracting. It covers the construction of a sewage network for the King Fahd suburb and the adjacent schemes west of the road in Dammam city.
It also involves the construction of regression lines with diameters up to 700 millimetres (mm) with a total length of 300 kilometres (km), as well as five ejection lines with diameters up to 500mm and a total of 15km, according to data obtained from regional projects tracker MEED Projects.
The second project, located in Hail, covers sewage networks with a conveyor line in the Al-Madayn area in Hail city.
The scope of the second contract includes the supply and installation of glazed pottery pipes with different diameters, from 200mm to 500mm, and the supply and installation works for glass fibre-reinforced plastic (GRP) pipes with diameters of 700-1,000mm with a total length of 84km.
The SR113.6m contract to build the project was awarded to another local firm, Alameryah United Contracting Company.
NWC last week announced that it has earmarked SR102.9bn for the implementation of 1,294 water and wastewater projects across the kingdom.
The company's CEO, Nemer bin Mohammed al-Shebl, said the schemes range from expansion projects for water and wastewater networks to the construction of water and wastewater treatment plants.
The company is also working to promote work on a commercial basis by reducing operating costs and maximising benefits from capital expenditure.
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And, while the values of awarded thermal plant and renewable energy plant contracts achieved parity in 2023, clients awarded thermal power plant contracts with a total value that was 172% higher than all awarded renewable contracts put together last year.
This trend establishes the return of gas as a feedstock for power generation plants across the GCC states, following years where only a handful of deals came through as a result of offtakers and utilities expanding their scope for renewable energy in line with their energy diversification plans.
The energy transition focus and the muted electricity demand growth throughout Covid-19 and shortly after the pandemic has meant that the comeback of thermal power plants has been fraught with challenges.
There is a squeeze on top original equipment manufacturers' capacity, with the top suppliers having clipped their capacity expansion plans in line with the anticipation that demand will fall, rather than rise, as the implementation of energy transition programmes took hold.
The sheer volume of new combined-cycle gas turbine (CCGT) projects in the GCC and nearly everywhere else has also put pressure on engineering, procurement and construction (EPC) contractors, which are now becoming more selective about which projects to bid on to manage project delivery risks.
This has led or is leading to a higher levelised cost of electricity (LCOE), as a diminished number of utility developers and investors that are still interested in bidding for thermal plant projects seek to protect their profit margins from elevated market risks.
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It is also unclear if the demand spike in CCGT, as well as the so-called peaker – or open-cycle gas turbine – plants, is short-lived, as a means to address the intermittency of renewables or replace liquid fuel-fired fleets, as in the case of Saudi Arabia. Or if it is long-lasting, as a permanent solution to achieving security of supply that will have to co-exist with the emerging battery energy storage systems (bess) technology.
Based on MEED Projects data, the existing project pipeline for thermal power plants in the GCC remains robust, with about $10bn under bid, $9.4bn in prequalification, and over $22bn under study and design.
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The continued deployment of renewables with or without bess, and the need to interconnect grids, will dictate to a large extent the pace at which offtakers and utilities in the region continue procuring thermal power plants.
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Iraq and Germany’s Siemens Energy have broken ground on a project to build a new combined-cycle gas turbine (CCGT) plant in Nasiriyah in Iraq’s southern Dhi Qar governorate.
The project is part of a $1.68bn development package that Iraqi Prime Minister Mohammed Shia Al-Sudani recently launched.
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Photo credit: Siemens Energy, for illustrative purposes only
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April 2025: Data drives regional projects
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Includes: Commodity tracker | Construction risk | Brent Spot Price | Construction output
MEED’s May 2025 report on the UAE includes:
> COMMENT: UAE is poised to weather the storm
> GOVERNMENT & ECONOMY: UAE looks to economic longevity
> BANKING: UAE banks dig in for new era
> UPSTREAM: Adnoc in cruise control with oil and gas targets
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> DATABANK: UAE growth prospects head northTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/13754417/main.gif -
UAE growth prospects head north
25 April 2025
MEED’s May 2025 report on the UAE includes:
> COMMENT: UAE is poised to weather the storm
> GOVERNMENT & ECONOMY: UAE looks to economic longevity
> BANKING: UAE banks dig in for new era
> UPSTREAM: Adnoc in cruise control with oil and gas targets
> DOWNSTREAM: Abu Dhabi chemicals sector sees relentless growth
> POWER: AI accelerates UAE power generation projects sector
> CONSTRUCTION: Dubai construction continues to lead region
> TRANSPORT: UAE accelerates its $60bn transport pushhttps://image.digitalinsightresearch.in/uploads/NewsArticle/13754369/main.gif -
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