Reuters reported that Saudi Electricity Company has awarded contracts for South Korea's Hyundai and Japan's Mitsubishi to build and supply equipment for a large power plant in Jeddah.

SEC said that Hyundai Heavy Industries will build the 2,650 MW power plant known as Jeddah South while Mitsubishi Heavy Industries will supply equipment for the oil fired plant.

The construction of the plant means Saudi Arabia, the world's largest crude exporter will continue to burn millions of barrels a week of oil for power generation for years to come. But SEC expects the more efficient plant to burn much less fuel oil per unit of electricity produced.

Mr Ali bin Saleh al Barrak CEO of SEC said that "We are using for the first time in the kingdom super critical boilers which have a higher efficiency, reaching up to 40% efficiency in fuel consumption. SEC had approved the award of an SAR 11.96 billion contract to build the plant but did not identify the winner. The contracts for Jeddah are expected to be signed in the next few weeks with contracts to build a similar sized oil fired power plant at Shuqaiq awarded in late 2013.”

Mr Barrak said that technical bids for the 2,600 MW Shuqaiq, a super critical fuel oil plant fitted with sulphur removing technology are due in the first quarter of next year. The state run company also plans to spend around $35bn on high voltage power lines with another USD 25 billion spent on distribution networks over the next 10 years.

Source - Reuters

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