Saudi state-run utility the Saline Water Conversion Corp (SWCC) is spending hundreds of millions of dollars to revamp its power and water plants and extend their lifespan, an SWCC official said.

The revamp would lengthen the lifespan of SWCC's plants, saving the cost of having to build new facilities, SWCC's vice governor for operation and maintenance affairs, Thabet Al-Luhibi, said.

Power demand is growing at around 7 percent per year in the world's top oil exporter, stretching the kingdom's grid as it spends billions of petrodollars to expand its economy.

"If I build a new plant today, definitely production would cost me more than extending the lifespan of the existing plant," Luhibi said.

The government has made around 1.3 billion riyals available ($346.7 million) for future work, Luhibi said, on top of the 3.5 billion riyals SWCC has already spent since launching the overhaul in 2001.

Extending the life of just over half the plants would save the kingdom around 1 billion riyals per year, he said.

SWCC has been working for three years on plans to go private. Those plans had no impact on the revamp, Luhibi said.

SWCC has 36 power and water plants across the kingdom, producing 5,000 Megawatts of power and 3.2 million cubic metres of water.
   
SWCC is the second-largest power producer in the kingdom. The Saudi Electricity Company (SEC) is the largest, with capacity of around 40,000 MW.

SWCC was looking to make fuel-burning plants more efficient, Luhibi said. Most power plants on the west coast of Saudi Arabia burn oil.

SWCC had spent about 380 million riyals to clean up emissions in the economic hub of Jeddah, Luhibi said.

SWCC plans to build a 2,400 MW power and water desalination plant in Ras Azzour to supply a bauxite refinery and aluminium smelter in a new industrial centre under construction.   

The kingdom's installed power capacity would grow to 140,000 MW in 25 years, Abdullah Al-Shehri, governor of the Electricity and Cogeneration Regulatory Authority told Reuters last year.- Reuters