Saudi Arabia looks to future and Vision 2040
5 October 2023
Commentary
Colin Foreman
Editor
Read the October 2023 edition of MEED Business Review
Saudi Arabia has been making newspaper headlines globally.
On the front pages, it has re-established relations with Iran after China-brokered peace talks earlier this year. More recently, it has been invited to join the Brics group of countries. The kingdom is also a critical component of the India-Middle East-Europe Economic Corridor, and the crown prince has told the US’ Fox News that a deal with Israel is getting closer.
On the back pages, investment in golf and football has meant Saudi Arabia is now a leading player in global sport.
The cooling of political tensions and focus on global sports is supporting the already-buoyant projects market. After several years of planning and delays caused by the Covid-19 pandemic, construction project activity may finally surpass its 2013 peak this year.
The focus for both the sector and Saudi policymakers has firmly turned to delivery.
Concerns have lingered that many of the legacy issues that the construction sector has been wrestling with since the 2014 collapse in oil prices are not being dealt with. But that began to change in 2022, when contractors working on the Riyadh Metro scheme struck a deal to complete the project.
The Jeddah Tower project symbolises the challenges of the past 10 years
Now, with the issue of the tender to complete the world’s tallest tower, Saudi Arabia’s construction sector has reached a watershed moment. As the world’s tallest tower, the 1,000-metre-plus-tall Jeddah Tower project symbolises the challenges of the past 10 years more than anything else.
The restart of the project means Saudi’s construction sector can concentrate on the kingdom’s future and delivering Riyadh’s economic ambitions.
While the immediate challenge is delivering projects for Vision 2030, work will not stop there. In the Fox News interview, Prince Mohammed bin Salman al-Saud revealed that he will start to shift his attention to Vision 2040, which he plans to launch in 2027 or 2028.
> AGENDA: Saudi Arabia’s Jeddah Tower reaches for new heights
> SKYSCRAPERS: Top 10 tallest towers in the region
> TALL TOWER PLANS: Saudi seeks to escape economic curse of record-breaking towers
MEED's October 2023 special report on Saudi Arabia includes:
> COMMENT: Riyadh reshapes its global role
> POLITICS: Saudi Arabia looks both east and west
> SPORT: Saudi Arabia’s football vision goes global
> ECONOMY: Riyadh prioritises stability over headline growth
> BANKS: Saudi banks track more modest growth path
> UPSTREAM: Aramco focuses on upstream capacity building
> DOWNSTREAM: Saudi chemical and downstream projects in motion
> POWER: Riyadh rides power projects surge
> WATER: Saudi water projects momentum holds steady
> GIGAPROJECTS: Gigaproject activity enters full swing
> TRANSPORT: Infrastructure projects support Riyadh’s logistics ambitions
> JEDDAH TOWER: Jeddah developer restarts world’s tallest tower
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Exclusive from Meed
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Firms seek to prequalify for Oman waste-to-energy project10 November 2025
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Teams form for Riyadh stadium PPP10 November 2025
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Retal awards $259m Jubail residential construction deal10 November 2025
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Singapore's Sembcorp Utilities and local firm OQ Alternative Energy (OQAE) have won a contract to develop the 125MW Dhofar 2 wind independent power project in Oman.
The contract was awarded by state offtaker Nama Power & Water Procurement Company (Nama PWP) under a 20-year power purchase agreement (PPA).
Under the PPA, Sembcorp and OQAE will form a joint venture to build, own and operate the wind farm, which will supply power to Nama PWP once operational.
The equity split will give Sembcorp 75% and OQAE 25%, a source close to the project told MEED.
Nama PWP said that it will allocate a portion of contracted works for the Dhofar 2 project to Omani small and medium-sized enterprises under its in-country value programme.
The project is expected to begin commercial operations in the third quarter of 2027.
The facility, valued at about OR43m ($112m), will be located on a 12-square-kilometre site in Dhofar Governorate.
The project comprises 20 Windey WD200 turbines, each with a 6.25MW capacity. Each turbine stands 215 metres tall and will be connected to the national grid via a 400kV substation.
The development will provide clean electricity to more than 18,000 homes and will cut carbon dioxide emissions by about 158,000 tonnes a year.
It is also expected to generate about 396,754 megawatt-hours and free up around 76 million cubic metres of natural gas annually.
Sembcorp has over 1.1GW of energy assets in Oman. In September, the firm signed a new 10-year power and water purchase agreement with Nama PWP for its Salalah independent water and power plant.
According to Nama PWP, the offtaker has contracted 26 water and desalination plants, exceeding $11bn in investment, over the past 15 years.
Chief energy transition officer at Nama PWP, Abdullah Bin Rashid Al-Sawafi, said the company "plans to attract a further $5bn over the next five years, mainly in renewable energy and storage technologies".
This includes an extra 9GW of renewable energy capacity by 2030, representing 60% of total contracted capacity.
Oman aims to have 30% of its electricity generation from renewable sources by the same year.
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Construction completed for Shuqaiq 4 desalination plant
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Construction and commissioning works on Saudi Arabia's Shuqaiq 4 desalination plant have been completed, according to Spain's Acciona.
Located on the Red Sea coast, the seawater reverse osmosis facility has a capacity of 400,000 cubic metres a day (cm/d) and will provide potable water to about 3.5 million people.
The main contract for the project was awarded in 2021 by the Saline Water Conversion Corporation to a consortium of Acciona and local partner Al-Rashid Trading & Contracting.
The facility is located adjacent to the operational Shuqaiq 3 independent water project (IWP), a separate project and Saudi Arabia’s second IWP.
The main contract was awarded by Water & Electricity Company – which is now known as Saudi Water Partnership Company (SWPC) – in January 2019 to a team led by Japan’s Marubeni and the local Abdul Latif Jameel.
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Oman’s state offtaker Nama Power & Water Procurement (Nama PWP) has received 18 statements of qualification from international and local companies for the planned waste-to-energy (WTE) project in Barka, South Al-Batinah Governorate.
The project will be Oman’s first large-scale WTE facility, with a generation capacity of 95MW-100MW.
According to Nama PWP, the facility will be developed on a 190,000-square-metre site and is scheduled to reach commercial operation in the fourth quarter of 2030.
US/India-based Synergy Consulting is acting as financial adviser to Nama PWP for the project.
The plant is expected to contribute 757 gigawatt-hours of renewable energy annually and reduce carbon dioxide emissions by about 302,000 tonnes a year.
It will process up to 3,000 tonnes of municipal solid waste a day using grate incineration technology.
The following companies submitted statements of qualifications:
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- Al-Ramooz National (Oman)
- Al-Tasnim Enterprise (Oman)
- Aspec for Contracting & Environmental Consultancy (Oman)
- China Communications Construction (China)
- China Everbright Environment Group (China)
- China Tianying (China)
- Eco Vision (Oman)
- Emirates Waste to Energy (UAE)
- Eternal Industrial Investment (China)
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- Kanadevia Inova (Switzerland)
- Keppel Seghers Engineering Co (Singapore)
- Mohammed Abdulmohsin Al-Kharafi & Sons (Kuwait)
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- Sinoma Energy Conservation (China)
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The clients issued the expressions of interest and request for qualifications notice in August, as MEED previously reported.
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Retal awards $259m Jubail residential construction deal
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Saudi private real estate developer Retal Urban Development Company (Retal) has awarded a SR972m ($259m) contract to its majority-owned contracting subsidiary, Building Construction Company (BCC).
The contract covers the design and construction of 901 residential units and the development of associated infrastructure works in Jubail Industrial City.
The contract duration is 40 months following the handover of the land to Retal.
In November 2023, Jubail & Yanbu Industrial Cities Services Company (Jabeen) and Retal signed a land transfer agreement worth SR1.2bn ($320m).
Retal has awarded major construction contracts to BCC recently. In March, Retal awarded a $131m contract to BCC for the construction of 371 residential units and associated infrastructure works in gigaproject developer Roshn’s Sedra housing community in Riyadh.
In January, Retal awarded another contract to BCC for the construction of 285 residential units in the Murcia zone of the Khuzam suburb of Riyadh.
The duration of this SR374m ($100m) contract is 2.5 years from the start of construction.
The construction work was slated to start immediately and the project is expected to be completed in 2027.
Prior to this, Retal awarded a SR240m ($64m) contract to BCC in April 2024 for the construction of eight residential buildings in Roshn’s Sedra community.
Retal was established in 2012 by the local Al-Fozan Holding Company to develop real estate projects in the kingdom.
Al-Fozan Holding Company also owns BCC, which is the contracting arm of the group.
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