30 December 2005 - An international Siemens-led consortium has been awarded a €1.8bn ($2.1bn) contract for turnkey production of a steam power plant with an associated desalination facility. The customer for this contract, which will be the largest independent water and power project (IWPP) worldwide, is Shuaibah Water and Electricity Company (SWEC), Riyadh, Saudi Arabia.

"Shuaibah is the largest single order that Siemens has posted to date for the Gulf region," explained Klaus Voges, group president of Siemens Power Generation, at the signature ceremony for the turnkey contract in Riyadh.

The Shuaibah plant, to be constructed by a consortium headed by Siemens PG and with Doosan Heavy Industries & Construction Co. Ltd., will be located about 110 kilometers South of Jeddah.

Shuaibah will be equipped with one of the most modern flue gas treatment systems in the world. Siemens Ltd. of Saudi Arabia will be assisting in construction of this oil-fired steam power plant. Once the three units are commissioned in late 2009, the plant will provide around 900 MW of power to the national grid. Additionally, the desalination plant supplied by Doosan will provide about 880 000 cubic meters of fresh water for the cities of Mecca, Jeddah, Taif and Al-Baha.

"The Middle East is one of our most important markets," Voges said. To date Siemens PG has supplied more than 300 gas turbines and steam turbines to the Middle East, with power plants of a total output of more than 20 000 MW currently finalized or under construction by Siemens in the region. Saudia Arabia is an interesting growth market.

The population of Saudia-Arabia is slated to nearly double to 40 million by the year 2020. For this reason, the kingdom is investing heavily in increased power and drinking water capacity. "Shuaibah is the first independent power and water project in Saudi Arabia, and the first of a total of four planned major projects. The goal of these projects is to increase installed power plant capacity by 4500 MW and provide an additional 2.2 million cubic meters of drinking water daily. The Shuaibah contract award underlines our market leadership in the Gulf region," Voges stated.

Following the Jeddah III, Ghazlan, and Al Khobar projects, this makes Shuaibah the fourth high-capacity steam power plant that Siemens PG is constructing in Saudi Arabia. In order to meet the increasing power demand, new power plants with a capacity of at least 3,000 megawatts are required each year in the kingdom.