Al-Arrab-SEPCOIII to build $2bn Saudi power plant

The tender process took more than three years. Photo illustrative only.

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A consortium of Riyadh-based Al Arrab Contracting Company and Chinese firm SEPCOIII last week received the letter of award to construct a 2,400 MW power plant in Ras Az Zawr, on Saudi's Arabian Gulf coast, from the Saline Water Conversion Corporation (SWCC).

The value of the letter was US$2.419 billion, according to an Al Arrab executive. It will burn natural gas and is expected to be completed in 42 months.

Al Arrab – which has a suite of subsidiary companies across the sector including an electro-mechanical arm in Dubai - has a long-established tendency to work with other contractors when needed.

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“We formed the consortium almost a year ago to target this important project,” said Samer Arafa, group executive vice president. Twenty-three companies and controtia submitted their bids for the project in May 2007.

SEPCOIII Electric Power Construction Corporation is a Qingdao-based firm that mainly spans projects in nuclear, thermal, gas-fired power, hydropower, wind power project and biological power projects. International clients have included those in India, Indonesia, Nigeria and Singapore.

Saudi Arabia has this summer driven its spending in a number of sectors, including infrastructure and utilities. The Kigdom's construction industry is set to increase by 7% this year, accordingt o Business Monitor International.

Through its subsidiaries Al Arrab has developed to compete for projects in a number of different sectors.

“There is still a need to further penetrate the market for speciality and geography,” he said in an interview with CW in May. “You cannot expect one company that works in one way to be able to manage multi-market. You need modules and specialities.”