Mena power rides high into 2024
29 December 2023

The Middle East and North Africa (Mena) region’s power generation and transmission sector awarded an estimated $25.3bn-worth of contracts between January and November 2023.
While this pales in comparison to the record high of $37.7bn awarded in 2015, it is up 38 per cent on the previous full year 2022, according to MEED Projects.
Year-on-year, the value of awarded power generation contracts increased by 40 per cent to reach $19bn, outperforming the transmission sub-sector growth by nine percentage points.
Saudi Arabia accounted for 60 per cent of the awarded power contracts in 2023. These include the contracts to develop four independent power projects (IPPs) that use combined-cycle gas turbines (CCGT), the first to be procured since the kingdom awarded the contract to develop the 1,500MW Al-Fadhili IPP to France’s Engie in 2016.
The Taiba 1 and 2 and Qassim 1 and 2 IPP projects each have a generation capacity of 1,800MW and require a combined investment of $7.8bn, of which roughly 80 per cent is accounted for by engineering, procurement and construction (EPC) costs.
The kingdom also awarded an EPC contract for the 1,200MW expansion of a power plant complex in Jubail during the year.
On the renewable energy front, the principal buyer, Saudi Power Procurement Company (SPPC), and the Public Investment Fund awarded some 6.7GW of solar photovoltaic (PV) IPP projects.
The uptick in awards marks a major improvement after a year of tepid renewables project activity in 2022, barring the solar and wind farm projects being developed as part of the large-scale green hydrogen and ammonia project in Neom.
The transmission and distribution sub-sector contributed to Saudi Arabia’s sterling market performance this year, delivering contracts worth over $3.5bn.
The kingdom’s electricity grid is expected to continue to be upgraded to accommodate growing renewable energy capacity and the rise in electricity demand as Vision 2030-related projects enter the execution phase.
The plan to accelerate electricity trade with its GCC neighbours and other countries in the region, such as Egypt and Iraq, is also anticipated to encourage future grid investments.
The award of the $2bn multi-utilities package for the Amaala development project also stood out, not least due to the inclusion of a 700 megawatt-hour battery energy storage system to enable the hotels within the development to be completely off-grid.
Unlike in the previous two years, Kuwait, the UAE and Oman also tendered or awarded substantial power generation contracts in 2023.
Nama Power & Water Procurement Company awarded the contracts to develop the second and third utility-scale solar PV schemes in the sultanate, Manah 1 and 2, each with a capacity of 500MW, in the first half of the year.
In September, Dubai Electricity & Water Authority awarded the contract to develop the sixth phase of the Mohammed bin Rashid solar complex.
Looking forward
The Mena power sector is expected to maintain its momentum into 2024, if the final quarter of 2023 is anything to go by.
Saudi Arabia is likely to continue dominating power project activities, with other states such as the UAE, Oman, Morocco, Egypt, Kuwait and Qatar offering significant opportunities for developers and EPC contractors.
Saudi Arabia’s SPPC has held a market-sounding event for the four solar IPPs under the fifth round of the kingdom’s National Renewable Energy Programme (NREP), while bid evaluation is still under way for the three wind IPPs under the NREP’s round four.
The tender documents are also being prepared for two CCGT projects in Riyadh, PP15 and Al-Khafji, with each expected to have a capacity of 3.6GW.
Qatar and Kuwait are advancing the procurement process for independent water and power producer (IWPP) projects that were held back over the past few years.
Abu Dhabi has initiated the procurement process for its fourth solar PV IPP and first twin battery energy storage facilities.
It will also almost certainly kick off the procurement process for one or two thermal power plants in the months ahead in anticipation of the need to replace expiring gas-fired capacity.
North Africa
The procurement of renewable energy plants, particularly in the North African states, led by Egypt and Morocco, is also expected to ramp up, in part due to their goals to develop green hydrogen hubs and export clean energy to Europe.
“Morocco is definitely going to be a major market from 2024 and onwards, with several IPPs in the planning and study stage,” says a senior partner with a transaction advisory firm.
Expectations also continue to thrive for many thermal projects planned in Libya and solar PV IPPs in Iraq, despite political uncertainties.
For Iraq in particular, the external pressure to rely less on Iranian electricity imports will provide impetus to its solar and CCGT capacity programmes.
The future trend for levelised costs of electricity is likely to remain mixed over the coming months
LCOE trend
The future trend for levelised costs of electricity (LCOEs) – or the pre-agreed, long-term tariffs an offtaker pays utility developers for their plants’ electricity output – is likely to remain mixed over the coming months, according to a region-based expert.
“The LCOEs for CCGTs are likely to remain stable next year, while solar LCOEs could slightly decline, compared with those seen in 2023,” the source tells MEED.
Supply chain constraints for gas turbines remain a concern for future CCGT power plants, given what is understood to be a long lead time for delivery and the production capacity constraints in the EU plants of the leading suppliers such as Germany’s Siemens Energy and the US’ GE.
While this opens opportunities for gas turbine manufacturers based in China, it is foreseeable that there remains a dominant preference for EU-made products across the Mena region, particularly in the GCC states.
The same expert argues, however, that the massive increase in gas turbine demand may be temporary, with demand likely to start petering off sometime after 2024, when clients and utility developers alike will have to consider the impact of these assets, whose concession agreements extend between 25 and 30 years, to their net-zero commitments.
As previously cited, Saudi Arabia will continue to dominate the region’s power sector project activities in the foreseeable future. Its ambition for renewable energy sources to account for half its capacity by 2030 and the Vision 2030-related plans to build off-grid developments such as Neom, the Red Sea and Amaala, as well as its multibillion-dollar industrialisation programme, will drive this.
According to MEED Projects data, Iran, Algeria, Kuwait, the UAE and Qatar are the other key markets for projects in the bidding stage. Morocco, Egypt, Kuwait and the UAE are the most promising markets for projects outside Saudi Arabia in the study, design or prequalification stage.
Overall, the net-zero commitments made by key states such as Saudi Arabia and the UAE, and plans to build green hydrogen valleys from Abu Dhabi to Morocco, in addition to an endemic rise in electricity demand as populations and economies grow, will likely keep the overall power sector buoyant over the coming years, barring any major events, like the Covid-19 pandemic in 2020 or the Russia-Ukraine war in 2022.
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Oman announces $790m industrial investment deals30 October 2026
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Saudi Basic Industries Corporation (Sabic) returned to profitability in the third quarter of the year, reporting adjusted net income of SR840m ($224m) as revenue and earnings improved from the previous quarter.
The Saudi chemicals giant had posted an adjusted net loss of $100m in the second quarter.
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Major ammonia-urea complex
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Greenfield methanol plant
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Saudi Arabia’s NWC awards package 12 of sewage scheme30 October 2026

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Local contractor Al-Yamama has won the contract for package 12 of Saudi Arabia’s long-term operations and maintenance (LTOM) sewage treatment programme, sources close to the project have confirmed to MEED.
It is understood that the contractor offered a levelised tariff of SR0.98 a cubic metre for the project.
The state-owned National Water Company (NWC) is delivering the sewage treatment plant rehabilitation programme in two phases, including up to 19 packages.
Known as the North Western B Cluster, LTOM12 was tendered last year, and bids were submitted in November 2025.
Under the original scope, the contract covers the construction and upgrade of seven sewage treatment plants with a combined capacity of about 162,000 cubic metres a day (cm/d).
In February, MEED exclusively reported that five bidders were awaiting a decision on the award.
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According to a source, NWC opened financial bids for the tender in April.
The contract represents Al-Yamama’s first award under the LTOM programme. However, the contractor has previously worked with NWC on several water infrastructure projects and is continuing construction works on a treatment plant expansion project in Al-Khobar in the Eastern Province.
Packages 10 and 11
On 2 September, NWC announced the formal signing of a $347m contract with a Saudi-Chinese consortium for Northern Cluster Sewage Treatment Plants Package 10 (LTOM10).
LTOM10 was the first contract awarded under the second phase of NWC’s sewage treatment plant rehabilitation programme.
The 15-year contract was signed with a tariff of SR0.69 ($0.18) a cubic metre.
MEED exclusively reported in January that the consortium had won the contract, which has a combined treatment design capacity of more than 337,000 cm/d and covers plants across the Hail, Qassim, Al-Jouf and Northern Borders provinces.
The same consortium led by United Water (China) is also expected to formally sign a contract for LTOM11 in the coming months.
NWC previously awarded $2.7bn-worth of contracts for the first phase of its LTOM programme. This comprises nine packages covering the treatment of 4.6 million cm/d of sewage water for the next 15 years.
Under tender
Two remaining packages in the LTOM programme are currently out for tender. As previously reported by MEED, bidders are preparing to submit offers for package 14, covering the upgrade of six existing sewage treatment plants (STPs), including a capacity expansion of 30,000 cm/d at the Al-Jarodia STP.
Known as the Eastern A Cluster (LTOM14), the project will increase total treatment capacity from about 263,000 cm/d to approximately 293,000 cm/d, with an estimated cost of $180m. NWC tendered the package in April, and the latest bid submission deadline is 30 November.
In the longer term, bids for package 16 of the LTOM programme are due by 3 May 2027. NWC tendered the contract earlier this month, as MEED reported exclusively.
Under the original scope, the project is expected to cover the rehabilitation and upgrade of 14 STPs with a total design capacity of 153,000 cm/d.
According to a source, bidders must first submit a letter of intent by 22 February 2027.
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