meed-logo

line1 line2 line3
SIGN IN / REGISTER

Events in January will shape Saudi market in 2024

1 February 2024

 

Register for MEED's guest programme 

January was a pivotal month for Saudi Arabia with a series of significant events that will shape how the market performs in 2024.

The month started well with major project deals signed that boosted confidence further after the market recorded its best-ever total value of contracts awarded. That optimism was tempered later in the month as fresh concerns over the outlook for project spending emerged after a high-profile corruption case and a government directive instructing Saudi Aramco to halt its plans to increase the kingdom’s oil production capacity.

Oil decision

In a statement on 30 January, Aramco said it had received a directive from the energy ministry to maintain its maximum sustainable capacity (MSC) at 12 million barrels a day (b/d). The state energy giant had previously been set a target of achieving an oil output spare capacity of 13 million b/d by 2027.

While some have interpreted the decision as a political move aimed at propping up the global oil price, others say it has been made to reduce capital expenditure commitments so Aramco can make larger dividend payments to its shareholders. The government holds a 90% share of the company, the PIF owns an 8% stake, and the remaining 2% of the shares are listed on the Saudi Stock Exchange (Tadawul).

Building boom

For construction, the largest contract award in January was the $4.7bn deal signed by Italy’s WeBuild to deliver three dams at the Trojena mountain resort in Neom that will host the 2029 Asian Winter Games. Other major deals included the SR1.8bn deal signed by Dubai-based Alec for constructing the Ilmi Centre at Misk, and the local MBL being selected for the contract to build the opera house at Jeddah Central.

Meanwhile at Al Ula, the kingdom’s Oversight & Anti-Corruption Authority (Nazaha) has suspended the CEO of the Royal Commission for Al Ula Governorate on the grounds of corruption and money-laundering charges. The charges against the executive, Amr Bin Saleh Abdul Rahman Al Madani, relate to his activities both before and during his role at the Royal Commission, involving the awards of contracts to a company named National Talents Company (TalentS).

Economic forecasts

These developments came amid a backdrop of mixed economic data. In mid-January, the Washington-based IMF revised the expected real GDP growth figure for Saudi Arabia in 2024 to 2.7%, down from the projection of 4% that it made three months earlier in October. The downgraded forecast reflects Saudi Arabia’s deepening oil production cuts.

Saudi Arabia’s additional voluntary cuts are by far the deepest by Opec+, with Riyadh agreeing to cut its oil production by a further 1 million barrels a day (b/d) through to the end of Q1 2024 – a cut double the size of the voluntary 500,000 b/d reduction by Russia – the next largest – for the same period.

Despite Western sanctions, Russia has also overtaken Saudi Arabia as China’s biggest source of oil imports in 2023. According to Chinese customs data released on 22 January, China – the largest oil importer in the world – purchased a record 107.2 million tonnes of crude oil from Russia last year, about 25% more than in 2022. Falling by 1.8%, China imported about 86 million tonnes of oil from Saudi Arabia.

A more positive indicator for Saudi Arabia is FDI. The kingdom’s foreign direct investment (FDI) inflows increased by 29.1% in the third quarter of 2023 compared to the previous three months, according to the Saudi Central Bank.

FDI inflows reached SR7.99bn ($2.13bn), rising from SR6.2bn recorded in the previous quarter. The announcement follows last year’s amendment of the country’s FDI calculation methodology by the government in Riyadh, showing that inflows doubled from 2015 to 2022.

Debt deals

As the economic outlook cools, Riyadh has tapped the debt markets. At the start of January, the Finance Ministry said it expects to borrow $23bn in 2024. The financing will be used to finance the deficit in the state budget and to pay existing debt that matures. The ministry added that by the end of 2024, it expects the kingdom’s total debt portfolio to reach SR1.115tn, which is about 29 per cent of GDP. That announcement was quickly followed by the issuance of $12bn of bonds under Saudi Arabia’s Global Medium-Term Note Issuance Programme (GMTN). Later in January, the Public Investment Fund (PIF) completed a $5bn bond issuance.

Both the government and the PIF could receive a cash boost from selling more shares in Saudi Aramco on the Tadawul. On 31 January, Bloomberg reported that the kingdom is working with a group of advisers and is seeking to potentially raise at least $10bn.

These developments are important for the projects sector. According to regional projects tracker MEED Projects, there are contracts valued at $181bn at the tender stage in the kingdom. The prospects for many of these pending deals will be shaped by what happened in January.

https://image.digitalinsightresearch.in/uploads/NewsArticle/11481164/main.gif
Colin Foreman

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Egypt approves plans for 869MW wind power plant

    22 June 2026

    Egypt’s Cabinet has approved plans for French renewable energy developer Voltalia to develop an 869MW wind power project.

    The scheme will be built on land allocated by the New & Renewable Energy Authority (NREA), according to a statement posted by the Cabinet following its most recent weekly meeting.

    Voltalia will make an initial investment of $53m and has committed to achieving commercial operations by December 2028.

    Voltalia already operates the 32MW Ra solar plant at the Benban solar complex in Aswan and is expanding its renewable energy portfolio in Egypt.

    Previously, in 2024, it signed a framework agreement with Egypt’s Taqa Arabia to develop a green hydrogen and renewable power cluster near the Ain Sokhna port in the Suez Canal Economic Zone.

    The green hydrogen development is planned in two phases, each centred on a 500MW electrolyser powered by more than 1.3GW of renewable generation capacity. The project, still in its early stages, is expected to produce up to 350,000 tonnes of green ammonia a year.

    Voltalia’s partnership with Taqa Arabia also includes plans for a 3.2GW hybrid wind and solar project to repower the existing 545MW Zafarana wind farm in Suez Governorate. The Cabinet statement did not indicate whether the newly approved 869MW wind project forms part of that proposal.

    Meanwhile, the developer won another contract, earlier this year, to develop a 132MW solar power project in Tunisia’s Gabes region.

    The project, known as Wadi, marked Voltalia’s third major solar award in the country after the Sagdoud and Menzel Habib projects awarded in 2024.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17376730/main.jpg
    Mark Dowdall
  • Local firm signs Jeddah drainage contracts

    22 June 2026

    Local contractor Alkhorayef Water & Power Technologies (AWPT) has announced it has signed two contracts with Jeddah Municipality to operate and maintain stormwater and surface water drainage networks across the city.

    The contracts have a combined value of SR202.06m ($53.9m), and each will run for five years.

    The first contract, valued at SR108.46m ($28.9m), covers the operation and cleaning of stormwater and surface water networks in the South and Al-Malisa sub-municipalities.

    The second contract, worth SR93.59m ($25m), covers similar services for the Airport Sub-Municipality.

    In March, MEED reported that the firm had won a long-term contract to carry out work in the airport’s sub-municipality area. The agreement was signed on 16 June.

    Elsewhere, construction has yet to begin on phases one and two of the King Abdullah Road-Falasteen Road tunnel project, each valued at about $175m.

    According to sources, Jeddah Municipality selected Saudi contractor Thrustboring Construction Company to build the large-diameter stormwater drainage tunnels in 2025. However, an official agreement has yet to be signed.

    The municipality was also previously planning to rehabilitate the existing Al-Zahra pumping station. Prequalification for the project began in 2020; however, it is understood that the main contact tender was cancelled last year.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17376097/main.jpg
    Mark Dowdall
  • Saudi firm signs Uzbekistan water treatment PPP

    22 June 2026

    Saudi-listed Miahona has signed a public-private partnership agreement to enhance, operate and maintain Uzbekistan’s Zomin water treatment plant in the country’s Jizzakh region.

    The agreement was signed on 18 June with Uzsuvtaminot, the country’s state-owned water utility, the developer said in a filing with the Saudi stock exchange.

    Miahona will carry out enhancement works and 25 years of operation and maintenance services for the existing plant, which has a design treatment capacity of 50,000 cubic metres a day

    The contract marks the company’s entry into Uzbekistan’s water sector. According to the disclosure, it will enter into force once a project-related governmental decree is issued in accordance with Uzbekistan’s applicable legislation.

    The contract is estimated at $105m (SR395m), with a final value to be confirmed following the issuance of the governmental decree.

    MEED reported earlier this month that Uzbekistan had stepped up its engagement with Middle Eastern investors, including holding talks with Saudi Arabia’s Acwa and Vision Invest on renewable energy, water management, waste recycling, digital infrastructure and urban utility projects.

    The government also recently held discussions with a UAE delegation led by Suhail Mohamed Al-Mazrouei, minister of energy and infrastructure and chairman of Etihad Water & Electricity’s Board of Directors.

    At the Tashkent International Investment Forum, it signed a €197m financing package with Germany’s KfW Development Bank to support drinking water supply and wastewater projects in the Surkhandarya and Fergana regions.

    The projects will cover Termez and several district centres in Surkhandarya region, as well as Kokand and Margilan in Fergana region.

    This includes “the construction and reconstruction of hundreds of kilometres of drinking water and wastewater networks, pumping stations and modern wastewater treatment facilities”, deputy prime minister Jamshid Khodjaev said.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17375811/main.jpg
    Mark Dowdall
  • Qiddiya seeks contractors for indoor arena project

    22 June 2026

     

    Register for MEED’s 14-day trial access 

    Saudi Arabian gigaproject developer Qiddiya Investment Company (QIC) has invited contractors to prequalify for a contract to build an indoor sports arena within its Qiddiya entertainment city project.

    The invitation was issued on 21 May, with a submission deadline of 28 June.

    The multipurpose arena is designed to International Olympic Committee standards.

    It will be located in District 18, in the Uptown South area of Qiddiya.

    Once completed, the indoor arena will be capable of hosting a wide range of sports, cultural and entertainment events.

    The arena will feature numerous sports courts for basketball, handball, futsal, volleyball, tennis, boxing and gymnastics.

    It will have a seating capacity of 18,000 spectators.

    The project is scheduled for completion by 2030.

    QIC’s other major projects include an e-sports arena, the National Tennis Centre, Prince Mohammed Bin Salman Stadium, a motorsports track, a racecourse, the Dragon Ball and Six Flags theme parks, and Aquarabia.

    QIC opened the Six Flags theme park to the public in December last year.

    The park covers 320,000 square metres and features 28 rides and attractions, including 10 thrill rides and 18 aimed at families and young children.

    The Qiddiya project is a key part of Riyadh’s strategy to boost leisure tourism in the kingdom.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17375504/main.jpg
    Yasir Iqbal
  • Egypt signs gas deal with Harbour Energy

    22 June 2026

    Egypt’s Ministry of Petroleum & Mineral Resources has signed a new agreement with London-headquartered Harbour Energy.

    Under the scope of the agreement, Harbour Energy will drill two new exploration wells and carry out maintenance work for one of the existing wells within the Dsouq-1 development contract.

    Harbour Energy committed an initial $6m investment and a $1m signing bonus for the Dsouq concession. Total investment could rise to $18m if commercial discoveries are made.

    The signing was witnessed by Egypt’s Minister of Petroleum, Karim Badawi.

    He said that his ministry is continuing to implement a package of investment measures and incentives aimed at encouraging partners to increase investments and intensify exploration, development and production activities.

    The agreement was signed by Syed Saleem, a member of the executive branch of the state-owned Egyptian Natural Gas Holding Company (EGAS), and Samah Sabry, the executive director of Harbour Energy for the Middle East and North Africa region.

    Harbour Energy drilled two new wells in Egypt during the fiscal year 2025/2026, resulting in the addition of reserves estimated at 35 billion cubic feet of gas.

    The company aims to drill three new exploration wells during the fiscal year 2026/2027.

    Egypt is currently pushing to boost the production of both oil and gas in its territory.

    Earlier this month, Egypt’s Ministry of Petroleum & Mineral Resources announced that it had fully settled all outstanding arrears owed to oil and gas companies.

    Two years ago, in June 2024, the country owed approximately $6.1bn to partners in the oil and gas sector.

    READ THE JUNE 2026 MEED BUSINESS REVIEW – click here to view PDF

    GCC looks beyond the Strait; Iraq’s reform window narrows as fiscal assumptions shatter; MEED Top 100 companies.

    Distributed to senior decision-makers in the region and around the world, the June 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17374536/main4731.jpg
    Wil Crisp