JEDDAH, 8 November — Makkah Governor Prince Abdul Majeed yesterday opened a SR375 million power station in Jeddah, one of the most important electricity projects ever to have been inaugurated in the province. The station will help ease pressure on the existing network, which is subjected to such extreme demand during the summer that power cuts often occur.
Prince Abdul Majeed has urged consumers to rationalize consumption.
The government intends to invest as much as $117 billion by the year 2020 to meet the growth in demand from the country’s soaring population. It has also said it will grant concessions to the private sector to construct new power plants on a BOT (build-operate-transfer) basis.
Minister of Industry and Electricity Dr. Hashim Yamani attended the opening ceremony with senior officials from the Saudi Electricity Company led by SEC Executive President Sulaiman Al-Qadi and its General Manager Foud Al-Sheraibi.
Dr. Yamani said the project is part of a wider plan aimed at meeting the growing demand for electricity, expected to increase by 150 percent over a five-year period ending in 2003.
Dr. Yamani said the opening up of the electricity generating sector to competition will allow for future development.
The privatization of the power sector resulted in the merger of the Kingdom’s four regional electricity companies — SCECO East, West, Central and South — leading to the creation of SEC.
The company, one of the largest in the Kingdom run on a trade bases, incorporates 10 regional firms and has a capital worth SR33.7 billion distributed on around 675.2 million shares, each worth SR50.
Prince Abdul Majeed toured the facility in the university neighborhood and listened to engineers explain the way the station worked.
He commended the progress achieved in the electricity sector and praised the SEC for its Saudization drive and the extensive training programs for the national staff.
The electricity service in the Kingdom covers more than 7,000 cities and villages in which there are over three million subscribers. At present, more than 70 percent of the 27,000-plus workers in the electricity sector are Saudis. The Kingdom is the largest producer of electricity in the Arab world.
On Tuesday, Dr. Yamani told an energy conference in Riyadh that power transmission will be open to the private sector including local and foreign investors. He added that the restructuring of the sector is nearing completion, giving momentum to the privatization drive.
Yamani announced that a new holding company would be set up jointly with local and foreign investors with the aim of creating a domestic energy services industry.
The firm, a joint-stock company with an initial capitalization of between SR600 and 800 million, will be mainly owned by the private sector, and the government contribution will be “in kind, in the form of two existing energy services companies.”
