Business Opportunities in the Saudi Power Sector - US
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Transcript Business Opportunities in the Saudi Power Sector - US
BUSINESS OPPORUNITIES
IN SAUDI POWER SECTOR
US-Saudi
BUSINESS OPPORTUNITIES FORUM
CHICAGO April 28-29, 2010
Ali Albarrak
President &C E O
Saudi Electricity Company
Electricity Industry in Saudi Arabia
Starts as 100%private ownership and operation.
Late 70`S consolidated into four major power co
(SCECO).
The government involved as major shareholder .
Mid 2000 All operating entities merged in one company
Saudi Electricity Company (SEC).
SAUDI ELECTRICITY COMPANY
Incorporated from 10 operating utilities in 2000.
Largest electric entity in the region in terms of
capacity ,market capital and shareholder’s equity.
Owns 85% generation and 100% transmission ,
distribution and retail .
Total assets over 50 billion US$.
Annual revenues 6 Billion US$ .
Annual growth 6%.
74% directly owned by the Government.
Scope of Operations
SEC credit strength
High growth in demand ( 7- 8%).
Operate in a very supportive environment .
High credit rating (AA~ ).
Invest in productive assets.
Reliable and secured fuel supply.
government support.
GROWTH (2000 – 2009)
No of
DATA customer
( Million)
Peak
Available Transmis
Energy
load generation sion (GWH)
(MW)
(MW)
(KM)
2000
3.6
22000
22000
30000
114000
2009
5.7
43000
45000
47000 191000
Increase
2.1
21000
23000
17000
77000
Growth
(%)
58%
95%
104%
57%
67%
projects Under Execution
ACTIVITIES
No of Projects
COST
( billion $)
GENERATION
174
17.3
TRANSMISSION
291
9.3
DISTRIBUTION
176
2.1
TOTALS
641
28.7
Load forecast (gwatts)
70
68.4
65.3
62.6
64
59.9
57.4
58
52.5
52
54.9
50.1
46.9
46
44
41
38.1
40
Series1
35.2
32.5
34
30.5
27 28.2
28
23.7
24.4
22
16
20
19
20
18
20
17
20
16
20
15
20
14
2.7
4.5%
20
13
20
11
20
10
20
09
2.8
6.0%
20
08
20
07
20
05
20
04
20
03
20
02
20
01
10
20
06
2.6
7.8%
20
12
1.5
6.0%
No OF CUSTOMERS
(millions)
7.6
6.4
2012
6.7
2015
2014
2013
5.9
2010
2009
2008
5.2
2007
2006
2005
4.73
4.96
5.42
5.7
6.2
2011
7.2
Generation Capacity
generation capacity installed should meet the expected
7% increase in peak demand and a reserve margin.
Generation capacity (GW)
100000
90
90000
74
80000
59
70000
60000
41
50000
40000
30000
20000
10000
0
2006e
2007e
2008e
SEC Installed & new capacity
2009e
2010e
2011e
IWPP Installed capacity
2012e
2013e
2014e
2015e
IPP Installed capacity
2016e
2017e
2018e
SWCC Installed capacity
2019e
2020e
2021e
Peak Load
2022e
2023e
total capacity
POWER SECTOR CHALLENGES
High annual growth in demand ( will continue 6-7%).
Extremely sharp daily and yearly load curve (airconditioning).
Replacement of inefficient old generating units.
High capital investment for expansion.
The need for private sector investment .
HOW TO MEET THE CHALLENGES ?
More investment in power generation,T&D .
Encourage the developers for more IPP.
Introduce the smart grid transmission system.
Promote energy conservation and load
management.
Invest in renewable energy.
Major Future Generation projects
Year
Project name
Rabigh Steam Expansion
2010
PP-10 (Steam)
Duba PP (IPP)
Al-Shogaig PP
Al-Jubail / Ras Al Zour
2011
Jeddah South
Al-Shogaig PP
Al-Jubail / Ras Al Zour
2012
Al-Shogaig PP
Duba PP
Jeddah South
Capacity (MW)
2,400
990
500
1,200
630
1,200
1,200
1260
800
250
600
Date in Service
2014
2014
2014
2014
2015
2015
2015
2016
2016
2016
2016
Major Future Generation projects
Year
Project
Al-Jubail / Ras Al Zour
2013
Al-Ogair / Salwa PP
Jeddah South
Al-Ogair / Salwa PP
Jeddah South
2014
Al-Ogair / Salwa PP
Al-Shogaig PP
2015
2016
Al-Ogair / Salwa PP
Al-Shogaig PP
Al-Jubail / Ras Al Zour
total capacity: 25000 MW
Capacity (MW)
630
630
600
1260
600
630
400
1,260
400
1,260
Date in Service
2017
2017
2016
2017
2018
2018
2017
2019
2018
2020
capital Cost : 50 Bln US$
IPP PROGRAM IN SEC
SEC will Continue to encourage private investors
to invest in Future Generation projects .
30 – 40 % of
Future generation will be IPP(BOO).
SEC partnership will be
10%-50% in the equity.
Long term power purchase agreements (20years)
With reasonable return on investment .
WHY IPP?
Providing Financial Option for Highly Capital
Intensive Generation Projects .
Helping To Re-Direct Available Funds To T&D
(Monopoly Activities)
Reallocation Expenditure From CAPEX To OPEX.
Avoiding Mismatch Between Medium Term
Financing and Long Life PP Projects.
SUCCESSFUL IPP ROJECTS
Two IPP Projects in process:
1. Rabigh Power Plant (closed financialyJuly last yea)
• 1200 MW / HFO
• IPCOD APRIL 2012
• Investment US$ 2.4 billions
2. Riyadh Power Plant 11 (financial close next month)
• 1800 MW / GAS
• IPCOD APRIL 2013
• INVESTMENT US 1.5 billions.
IPP FUTURE OPPORTUNITIES
(INVESTMENTS OF $20B) TO BUILD 12 GW
CAPACITY
(GW)
PRIVATE
SECTOR
SHARE %
PROJECT
COMPLETION
2
80
2014
DHEBA
1.6
80
2015
SHUQAIQ
1.6
80
2015
ALOGAIR
2.4
80
2016
JEDDAH
SOUTH
2.4
80
2017
RAS ALZOUR
2.4
80
2019
NAME OF IPP
PROJECT
QURAYYAH
18
SAUDI NATIONAL GRID by 2018
Future 380KV transmission lines projects
Year
Project
HAIL-ALJOUF-380KV
2010
ASIR_NAJRAN 380KV
GAISOUMAH -ALFADLI 380 KV
BISHA_DAWASIR 380KV
2011
5th 380 KV LINE TO CENTRAK
MADINAH-HAIL
RIYADH-JEDDAH DC line
2012
TABUK-TABARGAL
WEAST _SAUTH 2ND LINE
Length KM
Date in Service
300
400
250
500
400
360
800
600
500
2014
2014
2014
2015
2015
2015
2016
2016
2016
Future 380KV transmission lines projects
Year
2013
2014
2015
2016
Project
Circuit Length KM
Tabuk-Tabarjal
Umluj-Wadjh
South-West 2nd line
Jouf-Tabarjal
Al-grayat- Tabarjal
Madinah-Tabuk DCLine
total capital cost 24 billion $.
300
250
500
150
200
800
BUSINESS OPPORTUNITIES
Material and Equipment supply.
As an EPC contractor .
Local manufacturing .
Participate in IPP projects .
Opportunity in consultation and
engineering.
Invest in future energy retail.
Conclusion
The growth of electrical energy demand in Saudi
Arabia will continue 6-7%.
Power projects needs 80-90 billion US$ as capital
investments for the next 10 years .
Private investors have the opportunity to take 3040% of the generation projects as a BOO projects.
US companies have the opportunity to take part
both in EPC and IPP.
There are oportunities in Consultation ,
Engineering and Services in power sector.