meed-logo

line1 line2 line3
SIGN IN / REGISTER

Neom awards Oxagon infrastructure deals

8 November 2024

 

Register for MEED’s 14-day trial access 

Saudi Arabia’s Neom has awarded contracts for the infrastructure development at Oxagon industrial city. 

The gigaproject developer awarded the contracts to local firms including Al-Ayuni Investment & Contracting Company and Saudi Pan Kingdom (Sapac).

MEED understands that the Oxagon Interchanges 4 and 5 contract was awarded to Al-Ayuni.

Neom appointed Sapac as the contractor for Interchange 2 and the Sharma Interchange.

Neom has awarded significant infrastructure development contracts recently.

Earlier this week, MEED reported that Neom had awarded an estimated SR1.8bn ($500m) contract to the joint venture of Turkish contractor Kolin Construction and local firm Saudi Structures Contracting Company for an infrastructure development package at Trojena.

The contract was awarded for package two of the roads and utilities scheme, the scope of which involves infrastructure development works for the fun, gateway and discover clusters in Trojena.

This is the second major contract awarded to the joint venture by Neom for infrastructure works at Trojena. In September, MEED reported that Neom had awarded an estimated SR4bn ($1.1bn) contract to Kolin Construction and Saudi Structures Contracting Company for another infrastructure development package at Trojena.

Firms have also been asked to submit revised offers by 10 November for the contract to build the tunnels that will serve as the railway junction connecting the Spine with the Neom Connector.

Known as the Delta Junction, the project involves 26.5 kilometres (km) of tunnelling work that will be split into two lots, one for the north and the other for the south.

Crown Prince Mohammed Bin Salman Al-Saud launched Oxagon in late 2021. It will include onshore elements as well as floating structures offshore. Construction works on the 48 square-kilometre, eight-sided industrial city have already started.

An expanded Duba port is a critical component of Oxagon and the broader Neom development, as it will allow greater volumes of materials to be imported for the project. With an expected investment value of $500bn, Neom is the largest programme of construction work in the world.

https://image.digitalinsightresearch.in/uploads/NewsArticle/12874507/main.gif
Yasir Iqbal

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

Click here to register
Exclusive from Meed
Related Articles
  • Mitsubishi Power to supply Rumah 1 and Nairiyah 1 turbines

    21 November 2024

    The developer and engineering, procurement and construction (EPC) teams that will develop and build the Rumah 1 and Nairiyah 1 combined-cycle gas turbine (CCGT) schemes in Saudi Arabia are understood to have partnered with Tokyo-headquartered Mitsubishi Power for the gas turbines to power the plants.

    The Rumah 1 and Nairiyah 1 independent power projects (IPPs) will each have a capacity of 1,800MW.

    The principal buyer, Saudi Power Procurement Company (SPPC), previously indicated that the power plants would operate using natural gas combined-cycle technology with a carbon-capture unit readiness provision.

    A consortium comprising Saudi Electricity Company (SEC), Riyadh-based utility developer Acwa Power and South Korea’s Korea Electric Power Corporation (Kepco) won the contract to develop the two CCGT independent power projects (IPP).

    The consortium signed the power-purchase agreements (PPAs) for the two projects with the SPPC on 18 November.

    China’s Sepco 3 and South Korea’s Doosan Enerbility will undertake the EPC contract for the projects, as MEED reported.

    The SEC, Acwa Power and Kepco team offered a levelised electricity cost (LCOE) of $cents 4.5859 a kilowatt-hour (kWh) for Rumah 1, and $cents 4.6114/kWh for Nairiyah 1.

    Acwa Power said that the two IPPs will require a combined investment of approximately SR15bn ($4bn). The IPPs are expected to reach commercial operations in Q2 2008. 

    Rumah 1 is located in the Central Region in Riyadh and is part of the previously planned Riyadh Power Plant 15 (PP15). Nairiyah 1 is located in the Eastern Region.

    SPPC received bids for the contracts for four thermal IPPs – the other two being the similarly configured Rumah 2 and Nairiyah 2 – on 21 August.

    The four power generation facilities will be developed using a build-own-operate (BOO) model over 25 years. 

    SPPC’s transaction advisory team for the Rumah 1 and 2 and Al-Nairiyah 1 and 2 IPP projects comprises US/India-based Synergy Consulting, Germany’s Fichtner and US-headquartered Baker McKenzie. 

    Najm and Mitsubishi Power

    The Rumah and Nairiyah 2 orders will be the second one this year for Mitsubishi Power, which in August confirmed receiving an order from South Korea's Samsung C&T Corporation to provide its M501JAC hydrogen-ready CCGT for the Najim industrial steam and electricity cogeneration plant in Jubail in the Eastern Province of Saudi Arabia.

    The M501JAC gas turbine will enable the new cogeneration plant to generate up to 475MW of power and approximately 452 tonnes an hour of steam.

    Samsung C&T is the engineering, procurement and construction (EPC) contractor for the project, which is being developed by a team comprising Abu Dhabi National Energy Company (Taqa) and Japanese power generation company Jera, the same team that won the contract to develop and operate the Rumah 2 and Nairiyah 2 CCGT contracts.

    Photo credit: Mitsubishi Power (for illustrative purposes only)

    https://image.digitalinsightresearch.in/uploads/NewsArticle/12964755/main.jpg
    Jennifer Aguinaldo
  • Shanghai Electric to build 2GW Al-Sadawi solar project

    21 November 2024

    A developer team that includes Abu Dhabi Future Energy Company (Masdar), South Korea's Korea Electric Power Corporation (Kepco) and China's GD Power Development has tapped a Chinese firm to undertake the engineering, procurement and construction (EPC) contract for a 2GW solar project in Saudi Arabia.

    According to an industry source, Shanghai Electric will undertake the EPC work for the 2,000MW Al-Sadawi solar independent power project (IPP).

    The winning developer consortium signed the power-purchase agreement (PPA) with the principal buyer, Saudi Power Procurement Company (SPPC), for the project on 18 November.

    It offered a levelised cost of electricity of hals 4.847 ($c1.29) a kilowatt-hour (kWh) for the contract to develop the scheme, which is located in the Eastern Province.

    The second-lowest bidder is a team that includes China's SPIC Huanghe Hydropower Development and France's EDF Renewables, which offered to develop the project for $c1.31/kWh.

    SPPC received six proposals from companies for the contracts to develop and operate four solar photovoltaic (PV) IPP projects under the fifth procurement round of the kingdom's National Renewable Energy Programme (NREP) in August.

    According to SPPC, the lowest and second-lowest bidders in the remaining schemes under round five of the NREP are:

    Al-Masaa solar IPP (Hail): 1,000MW

    • L1: SPIC/EDF Renewables (France): $c1.36/kWh
    • L2: AlJomaih Energy & Water (local) / TotalEnergies Renewables (France): $c1.40/kWh

    Al-Hinakiyah 2 solar IPP (Medina): 400MW

    • L1: SPIC/EDF: $c1.51/kWh
    • L2: Masdar/Kepco/Nesma:  $c1.57/kWh

    Rabigh 2 solar IPP (Mecca): 300MW

    • L1: AlJomaih Energy & Water / TotalEnergies Renewables: $c1.78/kWh
    • L2: Masdar/Kepco/Nesma: $c1.89/kWh

    Saudi utility developer Acwa Power is not among the 23 companies that were prequalified to bid for the fifth round of NREP projects.

    US/India-based Synergy Consulting is providing financial advisory services to SPPC for the NREP fifth-round tender. Germany's Fichtner Consulting is providing technical consultancy services.

    The round five solar PV IPPs take the total capacity of publicly tendered renewable energy projects in Saudi Arabia to over 10,300MW. Solar PV IPPs account for 79%, or about 8,100MW, of the total capacity.

    Four wind IPPs, one of which has yet to be awarded, account for the remaining capacity.

    SPPC is procuring 30% of the kingdom's target renewable energy by 2030. Saudi sovereign wealth vehicle the Public Investment Fund (PIF) is procuring the rest through the Price Discovery Scheme. The PIF has appointed Acwa Power, which it partly owns, as principal partner for these projects.

    The Saudi Energy Ministry recently said that the kingdom plans to procure 20,000MW of renewable energy capacity annually, starting this year and until 2030.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/12964642/main.gif
    Jennifer Aguinaldo
  • Chinese firm wins 2.6GW Saudi inverter deals

    21 November 2024

    The engineering, procurement and construction (EPC) contractors implementing two of Saudi Arabia Public Investment Fund's (PIF) cluster-four solar photovoltaic (PV) projects have awarded contracts for the supply of inverters to China's Sineng Electric.

    The Jiangsu-headquartered company secured an order for 1GW of inverters from China Energy Engineering Group Consortium for the Haden solar PV project and 1GW from Indian contracting firm Larsen & Toubro for the Al-Khushaybi solar PV project.

    Sineng will provide its 8.8MW MV turnkey stations, each comprising 2 units of 4.4MW central inverter, a transformer and a ring main unit (RMU) for the solar projects.

    Designed to "withstand extreme temperatures [of] up to 51ºC… and strong sand-laden winds", the 8.8MW MV turnkey stations are expected to deliver consistent and reliable performance throughout the solar PV plants' operational lifespan.

    The PIF awarded the contracts to develop three cluster-four solar PV projects to a consortium led by Saudi utility developer Acwa Power earlier this year.

    The developer consortium, which includes PIF-backed Water & Electricity Holding Company (Badeel) and Saudi Aramco Power Company (Sapco), reached financial close for the three projects, which have a total combined capacity of  5,500MW, in September.

    The solar PV projects and their capacities are:

    • Haden solar PV (Mecca): 2,000MW
    • Muwayh (Mecca): 2,000MW
    • Al-Khushaybi (Qassim): 1,500MW

    The respective project companies that have been formed for the three projects are Buraiq Renewable Energy Company, Moya Renewable Energy Company and Nabah Renewable Energy Company.

    Acwa Power’s effective shareholding in each of the three projects is 35.1%. Badeel owns 34.9% and Sapco, a subsidiary of state majority-owned oil giant Saudi Aramco, owns the remaining shares.

    The project companies signed financing documents amounting to SR9.7bn ($2.6bn), Acwa Power previously announced. The financing duration is 27.3 years.

    The three projects are being procured under the National Renewable Energy Programme's (NREP) Price Discovery Scheme, which is being implemented by the PIF.

    Under this scheme, the projects are directly negotiated with Acwa Power and its selected partners.

    The three new solar PV facilities have a combined value of SR12.3bn ($3.3bn) and are expected to become operational in the first half of 2027.

    The PIF and its partners are currently developing several solar PV projects with a total capacity of 13.6GW, involving over $9bn in investments. These joint projects – including Sudair, Shuaibah 2, Ar Rass 2, Al-Kahfah and Saad 2 – are intended to enable and support the local private sector through domestic supply-chain participation.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/12963512/main.jpg
    Jennifer Aguinaldo
  • Marubeni-led team reaches 1.1GW wind financial close

    21 November 2024

    A developer consortium led by Japan's Marubeni Corporation has reached financial close with a team of lenders for the contracts to develop two wind independent power producer (IPP) projects in Saudi Arabia.

    Marubeni and the local Ajlan & Bros won the contracts to develop the first two wind schemes of the kingdom's National Renewable Energy Programme (NREP) round four, the 600MW Al-Ghat and the 500MW Waad Al-Shamal wind IPPs, in May this year.

    According to an industry source, the following lenders will provide financing for the two projects:

    • Japan Bank for International Cooperation (Jbic)
    • Standard Chartered Bank (UK)
    • Sumitomo Mitsui Trust Bank (Japan)
    • Commercial Bank of Dubai (UAE)

    The consortium agreed to develop and operate the 600MW Al-Ghat wind IPP project with a new world-record-low levelised electricity cost (LCOE) from wind power of $cents 1.56558 a kilowatt-hour (kWh), or about 5.87094 halalas/kWh.

    The 500MW Waad Al-Shamal project has also achieved a second world-record-low tariff for wind power of $cents 1.70187/kWh or 6.38201 halalas/kWh, the energy ministry announced in May.

    The tariff achieved for Al-Ghat is almost 22% lower compared to the LCOE agreed for Saudi Arabia's first wind IPP, the 400MW Dumat Al-Jandal scheme, which a team comprising the UAE's Abu Dhabi Future Energy (Masdar) and France's EDF Renewables won in 2019.

    Marubeni will own 51% while Ajlan will maintain a 49% stake in the project company that will implement the projects.

    The Japanese-local team has appointed Power Construction Corporation of China (Power China) and Sepco 3 to undertake the wind projects' engineering, procurement and construction (EPC) contract.

    MEED previously reported that the same developer team is expected to win the contract to develop and operate the third wind scheme of NREP round four, the 700MW Yanbu wind IPP.

    The contract could be awarded before the year-end, according to a source.

    It is understood that other teams, separately led by local utility developer Acwa Power, France's Engie and EDF Renewables, submitted proposals for the contract to develop the Yanbu wind IPP scheme.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/12959899/main.jpg
    Jennifer Aguinaldo
  • L&T signs $400m Riyadh-Kudmi transmission contract

    20 November 2024

    India-headquartered contracting firm Larsen & Toubro (L&T) has signed a contract with state utility Saudi Electricity Company (SEC) for the construction of a new 500-kilovolt (kV) high-voltage direct current (HVDC) project in Saudi Arabia.

    The contract is valued at SR1.51bn ($400m).

    The project involves constructing a section of the HVDC transmission lines from the Riyadh Power Plant 14 (PP14) in the capital to the southwest coastal region of Kudmi.

    MEED understands that the contract was awarded on a lump-sum turnkey basis.

    The other two sections of the HVDC transmission project, which has a total length of 1,089-kilometres (km), have been awarded to South Korea's Hyundai Engineering & Construction Company and Saudi Services for Electro Mechanic Works (SSEM).

    Earlier this month,  Hyundai E&C announced winning a KRW1tn ($725m) contract as part of the PP14-Kudmi HVDC network project. Hyundai E&C's portion of the total package extends over 369km, and is expected to be completed by January 2027.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/12955076/main.jpg
    Jennifer Aguinaldo