Saudi starts work on giant power plant project
Riyadh, December 3, 2011
Saudi-owned ACWA Power said it has started work on the largest independent power generation project in the world at Qurayyah on the eastern coast of the Kingdom.
The project, to be developed on a BOO (build, own, operate) basis, will be located adjacent to existing SEC facilities and will substantially increase power supplies to the Saudi power grid.
The Qurayyah project will deliver 3927 MW of electricity to State-controlled Saudi Electricity Company (SEC) under a 20-year Power Purchase Agreement (PPA) commencing on June 30, 2014.
The project, the third of its type, and the largest IPP being developed by SEC represents another major development in the Saudi power sector to help meet the rapidly increasing power demand in the kingdom.
SEC had recently signed the 10.7 billion riyals ($2.85 billion) deal to build the 4,000-megawatt (MW) gas fired power plant aimed at keeping up with rapidly rising Saudi power demand.
The plant deal, was signed with a consortium led by Saudi Acwa Power Projects which includes South Korea's Samsung C&T and and Mena Fund, combines two plant project phases.
The project company “Hajr Electricity Production Company (HAJR) was established with the winning consortium owning 50 per cent and SEC owning the remaining 50 per cent.
Siemens will provide all major equipment and electrical systems and Samsung C&T will Engineer, Procure and Construct the project as the EPC contractor to deliver the project.
Once completed, the plant will be operated by The First National Operation & Maintenance Company (Nomac) a subsidiary of ACWA Power under a long-term operation and maintenance contract with Siemens providing parts and services for the gas turbines.
Yousef AlOuhali, the executive managing officer of HAJR said, 'Qurayyah IPP is a Greenfield Independent Power Project with a net generation capacity of 3927 MW. The design production capacity will make it the largest IPP combine cycle gas-fired power plant in the world once completed.'
The project is being funded with $730 million of equity capital through an equity bridge murabaha facility provided by Arab National Bank, Banque Saudi Fransi, The National Commercial Bank, Samba Capital, Saudi British Bank, and Saudi Hollandi Bank and 2.07 billion of debt funded by Arab National Bank, Banque Saudi Fransi, Hong-Kong Shanghai Bank, Korea Export Import Bank, Kreditanstalt Fur Wideraufbau, The National Commercial Bank, Samba Capital, Saudi British Bank, Standard Chartered Bank, Sumitomo Mitsui Banking Corporation and US Export Import Bank.
According to him, Qurayyah IPP comprises 6 identical groups of equipment, each delivering net output of 654.5 MW. Each group comprises 2 Gas Turbines (GTS), 2 Heat Recovery Steam Generators (HRSG) and 1 steam turbine.
The Qurayyah IPP Plant is designed and will be constructed to comply with all applicable environmental laws, guidelines, regulations and standards as per World Bank, IFC and Saudi Presidency of Meteorology and Environment (PME).
AlOuhali said, 'We are proud to be the project owner of Qurayyah IPP not only because it is the world’s largest combined cycle IPP, but most importantly the project will provide major economic advantage for the Kingdom.'
'Firstly, the project was bid with the lowest tariff possible (21 per cent lower than the nearest bidder), thus delivering over SR2 billion of savings over 20 years to the economy of the Kingdom,' he stated.
Also the project has been designed with the highest thermal performance possible, more than 52 per cent efficiency, or 14 per cnt more efficient than the traditional steam power plant exist in the Kingdome now which make it the most efficient in Saudi Arabia.
'This high efficiency will save the Kingdom more than SAR2M/day in fuel cost, using the present world natural gas price,' AlOuhali noted.
The Qurayyah IPP Plant is designed and will be constructed to comply with all applicable environmental laws, guidelines, regulations and standards as per World Bank, IFC and Saudi Presidency of Meteorology and Environment (PME), he added.-TradeArabia News Service