meed-logo

line1 line2 line3
SIGN IN / REGISTER

Saudi water begins next growth phase

10 March 2023

 

Saudi Arabia’s National Water Strategy 2030 continues to drive investments in the kingdom’s water desalination, treatment and distribution sector.

The strategy aims to reduce the water demand-supply gap and ensure desalinated water accounts for 90 per cent of the national urban supply to reduce reliance on non-renewable ground sources.

The need to boost the security of supply amid rising demand, volatile costs and increased compliance with sustainability goals is also driving project activity – particularly in terms of using more energy-efficient technologies to convert seawater into potable water – as well as improving storage capacity.

As of March, an estimated 2.66 million cubic metres a day (cm/d) of water desalination capacity is under construction by the main water utility provider Saline Water Conversion Corporation (SWCC) and state water offtaker Saudi Water Partnership Company (SWPC). 

At least a further 2.4 million cm/d of capacity is under procurement using both the independent water producer (IWP) model, mainly through SWPC, and the engineering, procurement and construction (EPC) model, primarily via SWCC. 

Following the award of successive IWP contracts in 2019-20, SWPC paced the award of new contracts and also tendered new jobs in 2021-22.

As in most sectors and geographies, the Covid-19 pandemic and war in Ukraine impacted project finance costs and inflation in Saudi Arabia, both particularly relevant to IWP projects.

New developments in the latter part of last year and the first few months of 2023, including the imminent award of the contract to develop the Rabigh 4 IWP, indicate that SWPC is reestablishing its projects momentum.

Similarly, there has been increased activity in water desalination EPC projects being procured by SWCC, such as the proposed seawater reverse osmosis (SWRO) facilities in Shuaibah and Yanbu, which have a combined capacity of over 1 million cm/d.

These are in addition to the under-construction Jubail 2 SWRO plant, with a capacity of 1 million cm/d, and the 400,000 cm/d Shuqaiq 1 SWRO facility, whose main contracts were awarded in 2021 and 2020, respectively.

Along with meeting rising demand, these projects address the decarbonisation requirements of Saudi Arabia’s water sector, which the kingdom’s pledge last year to reach net-zero carbon emissions by 2060 has made more urgent.

This drive is highlighted by the Shuaibah 3 IWP project, for which a team led by Riyadh-headquartered utility developer Acwa Power won the directly-negotiated contract in 2022.

The 600,000 cm/d SWRO plant will replace the existing multi-stage flash (MSF)-based desalination unit that is being decommissioned in 2025 at the existing Shuaibah 3 independent water and power project (IWPP).

The Shuaibah 3 project was the lone IWP contract awarded by SWPC last year.

The same carbon emissions reduction incentive is driving the Yanbu 2 SWRO project. According to SWCC, the project aligns with improving the environmental impact of the desalination water unit of Yanbu phase 2.

Power & Water Utility Company for Jubail & Yanbu (Marafiq) owns the Yanbu 2 integrated water and power desalination plant, which came onstream in 2015. Like the Shuaibah 3 IWPP, the facility’s desalination unit utilises the older, energy-intensive MSF technology.

Saudi Arabia reinvigorates power sector

Other water PPP projects 

The procurement processes are proceeding simultaneously for several independent sewage treatment plants (ISTP), water transmission pipelines and water reservoir facilities being overseen by SWPC across Saudi Arabia.

SWPC tendered the first scheme under the third round of its ISTP programme in November. The Al-Haer ISTP will have a design capacity of 200,000 cm/d.

The tender is also expected in the first half of the year for the two other schemes under batch three, the Riyadh East and Khamis Mushait ISTP schemes.

At least five other ISTP projects are in the planning stage. 

In November, the Taif ISTP scheme, one of the first-round ISTP projects awarded in 2019, entered commercial operation. 

SWPC has received three bids for its first water transmission pipeline public-private partnership (PPP) project, which links Rayis in Medina to Rabigh in Mecca, with prequalification under way for three similar schemes.

Bids are due in April for the contract to develop the kingdom’s first independent strategic water reservoir (ISWR) project. The Juranah ISWR project will be implemented in Mecca, using a build, own, operate and transfer model. The project includes a water reservoir and associated infrastructure and facilities.

It supports Saudi Arabia’s goal to increase municipal water storage capacity to an average of seven days by 2030. In addition, the government aims to increase water storage capacity to an equivalent of 20 days of Hajj demand in Mecca and 40 days of Hajj demand in Medina by 2022. 

Two other IWTP schemes are planned for Mecca under SWPC’s 2020 seven-year planning statement.

Wastewater treatment

Over the past year, the kingdom’s chief wastewater collection and treatment firm, National Water Company (NWC), has tendered a series of contracts across governorates and provinces.

They include contracts for the construction of networks and pumping stations in Aziziyah in Mecca and other areas in Al-Khobar; three lifting stations and ejection lines with diameters of up to 700mm serving different areas in Jubail; and a sewage project in the King Fahd suburb in the Eastern Province and adjacent schemes west of Abu Hadriya Road in Dammam.

Requests for proposals (RFPs) have also been issued to complete sewage facilities in Al-Khafji governorate, West Safwa and Fayhaa.

These projects are part of NWC’s five-year, SR108bn ($29bn) investment plan for the kingdom’s water infrastructure. The latest five-year plan allocates an estimated SR39bn to Mecca, SR16bn to the Eastern Province and SR14.2bn to Riyadh.

The privatisation of NWC’s sewage treatment plant network is also being undertaken in parallel with improving its underlying infrastructure.

Under long-term operation and management (LTOM) agreements, private sector companies can bid to operate and upgrade water treatment plants.

The first package, for Mecca, was awarded in September 2022 to a team of the local Miahona and Thabat Construction Company. The rehabilitate-operate-transfer scheme is for 10 years and is valued at SR392m. Eight other packages are expected to be tendered under the LTOM programme.   

MEED's April 2023 special report on Saudi Arabia also includes:

> CONSTRUCTION: Saudi construction project ramp-up accelerates

> UPSTREAM: Aramco slated to escalate upstream spending

> DOWNSTREAM: Petchems ambitions define Saudi downstream

> POWER: Saudi Arabia reinvigorates power sector

> BANKING: Saudi banks bid to keep ahead of the pack

https://image.digitalinsightresearch.in/uploads/NewsArticle/10660701/main.jpg
Jennifer Aguinaldo

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

Click here to register
Exclusive from Meed
Related Articles
  • Local firm wins contract for Kuwait power project

    19 November 2025

    Local firm Alghanim International has won a contract to provide engineering services at the Subiya power and water distillation plant.

    Kuwait’s Central Agency for Public Tenders approved the award following a request from the Ministry of Electricity, Water & Renewable Energy.

    The contract, valued at $286m, covers engineering, supply, installation, operation and maintenance services to convert the 250MW second phase of the plant’s open-cycle gas turbines to combined-cycle gas turbines.

    The upgrade is intended to increase efficiency and provide additional generation capacity during periods of high demand.

    In July, MEED reported that Alghanim had submitted the lowest bid for the tender ahead of local firms Al-Daw Engineering General Trading & Contracting and Al-Zain United General Trading & Contracting.

    In 2024, US-based GE Vernova completed separate upgrades of four GE Vernova 9F.03 class gas turbines at the 2GW Sabiya combined-cycle power plant. Alghanim International acted as GE’s local engineering partner for that work.

    The Subiya power and water distillation plant is the largest power and water plant in Kuwait, with a power generation capacity of 7,046.7MW, accounting for 35% of the country’s installed capacity.

    It has a water desalination capacity of 100 million imperial gallons a day.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15116135/main.jpg
    Mark Dowdall
  • UKEF issues $3.5bn interest letter for Al-Maktoum airport

    19 November 2025

    Register for MEED’s 14-day trial access 

    The UK’s export credit agency UK Export Finance (UKEF) has issued a $3.5bn expression of interest letter to support the participation of UK businesses in the $35bn expansion of Al-Maktoum International airport, which is also known as Dubai World Central (DWC).

    Chris Bryant, UK minister for trade, handed the letter to Khalifa Al-Zaffin, executive chairman of Dubai Aviation City Corporation and Dubai Aviation Engineering Projects (DAEP), and Paul Griffiths, CEO of Dubai Airports.

    Letters of interest from UKEF, although not binding commitments, help ensure that UK exporters are given every opportunity to bid for contracts on a project. This is typically achieved by providing financial solutions in exchange for an agreed level of UK content used on the project.  

    Previous letter

    It is not the first time UKEF has issued a letter of interest for the expansion of Al-Maktoum International airport. In 2014, it issued a $2bn letter of interest. In a statement at the time, UKEF said five prime UK-based contractors were being supported, along with UK suppliers across the supply chain.

    The five prime contractors were Carillion, Kier, Balfour Beatty, Laing O’Rourke and Interserve. Of those five companies, Carillion entered liquidation in 2018 and Interserve entered administration in 2019. Balfour Beatty sold its shareholding in Dubai-based Dutco Balfour Beatty in 2017.

    Although some progress was made on the project after the UKEF offer in 2014, the scheme stalled and was revived again in April 2024, when Dubai approved new designs for the airport.

    Project progress

    Since then, the project client, DAEP, has been awarding and tendering contracts for the first construction packages. It has awarded a AED1bn ($272m) deal to UAE firm Binladin Contracting Group to construct the second runway at the airport.

    The enabling works for the terminal building are being undertaken by Abu Dhabi-based Tristar E&C.

    DAEP is also close to formally awarding a contract for the substructure works for the West Terminal and Concourse One, Concourse Two and Concourse Three.

    Tendering is also ongoing for an automated people-mover (APM) system. The system will run under the apron of the entire airfield and the airport’s terminals. It will consist of several tracks, taking passengers from the terminals to the concourses.

    Four underground stations will be built as part of the first phase. The overall plan includes 14 stations across the airport.

    The airport’s construction is planned to be undertaken in three phases. Construction works on the project’s first phase are expected to be completed by 2032.

    The airport will cover an area of 70 square kilometres (sq km) south of Dubai and will have five parallel runways, five terminal buildings and 400 aircraft gates.

    It will be five times the size of the existing Dubai International airport and will have the world’s largest passenger-handling capacity of 260 million passengers a year. For cargo, it will have the capacity to handle 12 million tonnes a year.

    Dubai has said the plan is for all operations from Dubai International airport to be transferred to Al-Maktoum International within 10 years.

    This aviation package also includes:

    > Middle East invests in giant airports
    > Broader region upgrades its airports
    > Global air travel shifts east

     

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15115788/main.jpg
    Colin Foreman
  • Riyadh gives Expo infrastructure bidders more time

    19 November 2025

     

    Saudi Arabia’s Expo 2030 Riyadh Company (ERC), which is tasked with delivering the Expo 2030 Riyadh venue, has extended the deadline for firms to submit commercial offers for the contract to undertake the initial infrastructure works at the site to 23 November.

    ERC had initially set deadlines of 26 October and 9 November for the submission of technical and commercial bids, respectively.

    The tender for the project’s initial infrastructure works was issued in September, as MEED reported.

    In October, MEED revealed that 16 firms had been invited to bid for the contract to undertake the initial infrastructure works at the Expo 2030 Riyadh site.

    The firms invited to bid include:

    • Shibh Al-Jazira Contracting (local)
    • Hassan Allam Construction (Egypt)
    • El-Seif Engineering Contracting (local)
    • Al-Ayuni Investment & Contracting (local)
    • Kolin Construction (Turkiye)
    • Al-Yamama Trading & Contracting Company (local)
    • Saudi Pan Kingdom (local)
    • Unimac (local)
    • Mapa Insaat (Turkiye)
    • Yuksel Insaat (Turkiye)
    • IC Ictas / Al-Rashid Trading & Contracting (Turkiye/local)
    • Mota-Engil / Albawani (Portugal/local)
    • Almabani / FCC Construction (local/Spain)

    The overall infrastructure works – covering the construction of the main utilities and civil works at Expo 2030 Riyadh – will be split into three packages:

    • Lot 1 covers the main utilities corridor
    • Lot 2 includes the northern cluster of the nature corridor
    • Lot 3 comprises the southern cluster of the nature corridor

    MEED previously reported that ERC was expected to issue the tender for some of the infrastructure packages in September.

    In July, US-based engineering firm Bechtel Corporation announced it had won the project management consultancy deal for the delivery of the Expo 2030 Riyadh masterplan construction works.

    The masterplan encompasses an area of 6 square kilometres, making it one of the largest sites designated for a World Expo event. Situated to the north of the Saudi capital, the site will be located near the future King Salman International airport, providing direct access to various landmarks within Riyadh.

    Countries participating in Expo 2030 Riyadh will have the option to construct permanent pavilions. This initiative is expected to create opportunities for business and investment growth in the region.

    The expo is forecast to attract more than 40 million visitors.

    The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth vehicle, launched ERC in June as a wholly owned subsidiary to build and operate facilities for Expo 2030.

    In a statement, the PIF said: “During its construction phases, Expo 2030 Riyadh and its legacy are projected to contribute around $64bn to Saudi GDP and generate approximately 171,000 direct and indirect jobs. Once operational, it is expected to contribute approximately $5.6bn to GDP.”

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15115697/main.jpg
    Yasir Iqbal
  • NHC and Turkish firm sign $266m investment deal

    19 November 2025

    Register for MEED’s 14-day trial access 

    Saudi Arabia’s National Housing Company (NHC) has signed an investment agreement worth over SR1bn ($266m) with Turkiye’s Emlak Konut to develop new residential communities within the Mecca Gate project in Mecca.

    The agreement was signed on the sidelines of the Cityscape Global 2025 event in Riyadh.

    Emlak Konut will develop 1,000 residential villas spanning over 255,000 square metres (sq m).

    The latest agreement follows the NHC’s signing of deals worth over SR8.5bn ($2.2bn) for the development of two mixed-use and residential communities in Riyadh.

    The first agreement, worth over SR5.2bn ($1.4bn), was signed with local developer Retal Urban Development Company.

    The deal encompasses the development of 4,839 residential units in the Al-Fursan suburb of Riyadh.

    The other contract, worth over SR3.3bn ($880m), was signed with a joint venture of Egypt’s Hassan Allam Holding and local developer Tilal Real Estate for a mixed-use project in the Khozam district.

    The development will cover an area of over 228,000 sq m.

    It will be delivered through Grova Developments, the development arm of Hassan Allam Holding.

    In 2023, NHC and Saudi Arabia’s Housing Ministry signed investment agreements totalling more than SR24bn ($6.4bn) to launch the Al-Fursan residential project.

    Al‑Fursan is described as the largest scheme in terms of area and number of housing units that NHC is implementing in partnership with other real estate developers. 

    MEED reported in 2020 that Riyadh planned to oversee the development of more than 1 million homes by 2025 to meet growing demand in the kingdom.

    By 2030, the Saudi capital aims to more than double its population, from 7-8 million to 15-20 million, and become one of the 10 wealthiest cities in the world.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15115626/main.png
    Yasir Iqbal
  • Egypt announces oil discovery in Western Desert

    19 November 2025

    Register for MEED’s 14-day trial access 

    A new gas discovery has been made in Egypt’s Western Desert region, according to a statement released by the Ministry of Petroleum & Mineral Resources.

    The discovery was made by Khalda Petroleum Company, a joint venture of state-owned Egyptian General Petroleum Corporation (EGPC) and US-headquartered Apache Corporation.

    The field is expected to be brought online this week, according to the ministry.

    The reserves were discovered after drilling the exploratory well ‘Gomana-1’, the ministry said.

    It added that sensors confirmed the presence of gas reserves, and tests indicated that the well is expected to have a production rate of around 36 million standard cubic feet of gas a day.

    Further tests are ongoing, and the initial evaluation of the well’s reserves is currently being finalised.

    The ministry said that the discovery followed the introduction of new incentives designed to encourage additional gas investment within Khalda’s areas of operation.

    Earlier this month, Egypt started gas production from the West Burullus field in the Mediterranean Sea, after connecting the first wells to the national gas grid.

    The country is currently pushing to increase domestic gas production in order to meet domestic demand and reduce its import bill.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15112551/main.png
    Wil Crisp