Saudi Arabia's district cooling market is booming, says SNC-Lavalin

SNC-Lavalin's managing director for the Middle East sees "exciting" opportunities in regional district cooling market

SNC-Lavalin said its contract with JODC will be completed in April 2020.
SNC-Lavalin said its contract with JODC will be completed in April 2020.

Saudi Arabia's district cooling market is set to surge despite a slowdown elsewhere, SNC-Lavalin's senior vice president of infrastructure in the Middle East, Mohamed Youssef, said. 

Two months after SNC-Lavalin signed a $42m (SAR160m) contract to increase district cooling capacity by a fifth at Jabal Omar Development Company’s (JODC) district cooling plant in Makkah, Saudi Arabia, Youssef told Construction Week that the kingdom's district cooling industry was "booming".

"District cooling is a very promising market in the GCC, and the benefits of district cooling in terms of energy consumption make it feasible for all the governments in the GCC to implement it in new developments," he said.

"The district cooling market is booming, even if it slowed down in some parts of the industries in the GCC. Our expectation is that in the coming four to five years the cooling district market will seize its exciting role."

READ: SNC-Lavalin wins major Meydan One MEP contract

To date, Canadian contractor SNC-Lavalin has built 46 district cooling plants in the Middle East, and it is working across the GCC to scale up the total number of operational facilities. And since providing engineering, procurement, construction and commissioning services for its first facility in the region, Youssef said the market had seen a major transformation in the last two years.

"Clients are more aware of the significance of district cooling solutions, the market is maturing, becoming more competitive, and the district cooling technology is rapidly developing to match the demanding issues of the complex projects," he said.

Historically, clients had to be told about the district cooling benefits, but many have become more aware now that the energy-efficient solution for keeping people cool in hot weather has become more widespread. This, however, has presented a new issue for SNC-Lavalin.

"Our challenges is now to present a competitive solution to the client without compromising on quality," Youssef said.

"We are sometimes competing with global players, we claim that we are the largest and the most active player in the field of district cooling. But we still have to be competitive because we have competitors and we don’t want to risk our reputation. These are the challenges and we are overcoming them by presenting feasible solutions to the client, and enhancing the way we execute district cooling projects."

SNC-Lavalin is rolling out district cooling projects for the King Khaled International Airport expansion, and expansion of the emirates aluminium smelter in Taweelah near Khalifa Port in Abu Dhabi.

SNC-Lavalin is a major provider of district cooling solutions in the Middle East, but the contractor is involved in numerous other high-profile projects. The Middle East business accounts for 23% of global revenue for the company, and its recent regional contract wins include work on a refinery in the UAE, and designing and building a $1.5bn (OMR576m) PVC plastics plant in Oman.

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