Nuclear remains an option for Riyadh and Washington
10 November 2023
Commentary
Jennifer Aguinaldo
Energy & technology editor
Saudi Arabia has extended by two months the last day for companies to submit their proposals for a contract to build the kingdom's first large-scale nuclear power plant facility in Duwaiheen, close to its border with Qatar.
Duwaiheen Nuclear Energy Company now expects to receive bids from three to four potential bidders by the end of December.
Related read: Mena pushes for nuclear future
The extension could be interpreted as the kingdom being in no hurry to procure the nuclear power plant, which has been in the planning stages for nearly a decade. The development of renewable energy sources has accelerated sharply during those years.
Solar photovoltaic plants with a capacity of over 6,000MW are under construction under the kingdom's national renewable energy programme, which the Energy Ministry and Saudi sovereign vehicle, the Public Investment Fund (PIF), are spearheading.
A further 7,800MW of solar PV plants are also about to begin construction.
In addition, the principal buyer, Saudi Power Procurement Company (SPPC), is due to award the contracts for the first thermal power independent power projects (IPPs) to be procured in the kingdom since 2016. The Taiba 1 and 2 and Qassim 1 and 2 IPPs will have a combined generation capacity of 7,200MW.
Completing these projects could take one to three years – significantly shorter than the gestation period of up to 10 years for a large-scale nuclear power plant.
While the kingdom may not be rushing to procure the nuclear power plant, it remains firmly on the table, particularly at the negotiations between Riyadh and Washington.
A month before the Hamas incursion into Israel, it was reported that senior Palestinian officials were in Riyadh for talks with senior Saudi and US officials.
It is understood that Riyadh is using its nuclear power plant project, along with its plan to enrich uranium sources as part of its industrial strategy, as a bargaining chip with the US government. The White House is pushing for the normalisation of relations between Israel and Saudi Arabia and opposed to uranium enrichment.
Unlike some of its smaller neighbours, Riyadh has never officially recognised Israel as an independent state.
According to a BBC report in early September, the Palestinians were negotiating for hundreds of millions of dollars and more control of land in the occupied West Bank in the event of a three-way deal between Israel, Saudi Arabia and the US.
On 14 October, it was reported that Saudi Arabia suspended the talks on potentially normalising ties with Israel.
Karen Young, a senior research scholar at the Centre on Global Energy Policy at Columbia University in the US, says there is still "tremendous opening in Washington towards Saudi requests and its ability to be a point of cooperation and facilitation for US foreign policy objectives in the region".
Young suggests that the opportunity has only increased since 7 October. Although events have clearly complicated Saudi Arabia's stance in navigating its domestic and regional pro-Palestinian, anti-Hamas perception.
While Riyadh's official narrative maintains that its nuclear strategy, including mining uranium, is purely industrial and will be carried out transparently, it is almost impossible to divest the project's geopolitical significance from its role in the kingdom's broader industrial and energy diversification programme.
This was only fuelled by Saudi Arabia's Crown Prince Mohammed bin Salman telling Fox News this year that the kingdom was concerned about any country getting a nuclear weapon and that if Iran successfully developed a weapon, Saudi Arabia would also have to acquire one.
The crown prince's statement has been taken to suggest that military options remain a factor in its civilian nuclear power programme.
From a pure project perspective, however, industry experts agree that the unfolding events in Gaza are unlikely to lead to the Duwaiheen nuclear power project being awarded any sooner.
The expectation is that the 31 December deadline may be extended further.
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