Service provision Water supply and sanitation in Saudi Arabia

1 service provision

1.1 national water company , management contracts
1.2 saline water conversion corporation
1.3 independent water , power producers desalination
1.4 water & energy company
1.5 project finance wastewater treatment plants

service provision

the responsibility service provision shared private , public sectors. national water company (nwc) in charge of water supply , sanitation in largest cities - riyadh, jeddah, mecca , taif of 2013 in partnership foreign private operators. in other cities water supply , sanitation still direct responsibility of mowe through regional directorates , branches. local government, in charge of service provision in many other countries, has no role in service provision in saudi arabia.

desalination plants run saline water conversion corporation (swcc) provides water free nwc or private companies called independent water , power projects (iwpps) sell water , energy public entity called water & energy company. many wastewater treatment plants run private companies under bot contracts.

the national water company , management contracts

the national water company (nwc) plans become leading water utility in region within 4 7 years after creation in 2008. nwc s twelve-member board chaired minister of water , electrity , includes ceo of company.

nwc contracts out water distribution services individual cities private sector under management contracts. key objectives include improving service quality, operational efficiency , customer satisfaction. contracts preceded one-year technical assistance contracts. followed further 1-2 year validation period during baseline , target data key performance indicators being reviewed. tariff levels not affected. scope of contracts includes training , qualifying saudi nationals, research , development aim transfer technology.

the 3 contracts signed far are:

in april 2008 capital riyadh french firm veolia, covering 6 years , valued @ $60m,
a seven-year contract french firm suez jeddah,
in june 2010 mecca , taif french firm saur, covering 5 years , valued @ $46m.

as required saudi law saur s team working in mecca consists entirely of muslims. further management contracts expected tendered medina , greater dammam.

nwc says between creation in 2008 , 2012 has saved 115.4 million m3 of water through leak reduction, improved water quality compliance 82% 98.7%, increased customer satisfaction 45% 83%, reduced number of projects behind schedule 104 3, , has improved annual cash collection sar561 million ($149 million) sar1,119 million ($298 million).

nwc plans , oversees infrastructure projects such sar 1.6 billion ($426 million) riyadh water supply programme completed in 2013 included drilling 43 new wells , building 27 brackish water desalination plants.

nwc had been expected take on medina in 2011, damman , al-khobar in 2013.

the saline water conversion corporation

the saline water conversion corporation (swcc) in charge of operating country’s publicly owned desalination plants, , operating network of water transmission pipelines 4,300 kilometres (2,700 mi) transport water in bulk plants major consumption centers, of them located far inland such riyadh. swcc biggest water desalination entity in world. has more 4.6 million m/day water installed capacity. swcc has research department , training center. although formally corporation, swcc not run independent company on commercial principles, rather branch of government. main product, bulk water, provided free main customer, nwc. of 2016, swcc holds sar80 billion ($21 billion) of assets.

in 2008 government announced plans privatize swcc transforming in holding company. holding company supervise affiliated production firms run desalination plants. subsequently sell off firms , include private sector in way similar has been done independent water , power projects (see below). first plant privatized in yanbu. however, plans have been modified in 2010: old plants continue operated swcc, while new plants built , operated private sector. in june 2016, amid low oil prices, decided revive initial privatization plan. water minister abdulrahman al-fadhli , swcc governor abdulrahman al-ibrahim said company become holding company, served local production units. privatisation in 2 stages: first, investment partners desalination plants ( production units ) sought; shares of holding company sold on saudi stock market. around sar110 billion ($29.3 billion) funding investment needed swcc on next 15 years.

independent water , power producers desalination

in 2000s, saudi arabia began invite private sector not build, finance , operate new desalination plants. water , energy corporation (wec) established off-taker buys water used municipal uses iwpps through 20-year power , water purchase agreements (pwpas). government guarantees payments due wec iwpps. follows example of persian gulf countries, had introduced iwpps several years earlier. first such project in saudi arabia shoaiba iii independent water , power producer (iwpp) signed in 2007 , completed in 2010. located on red sea , provides water jiddah, mecca , taif. second iwpp jubail ii project, located next jubail industrial complex on persian gulf coast. off-taker industrial water saudi company marafiq, utility provides power , water industrial cities of jubail , yanbu. formed royal decree in 2000 , established in 2003, owned 4 public entities , 7 private shareholders.

in 2007 saudi arabia had plans launch ten further iwpps 2016 total investment of $16 billion. however, saudi government changed approach , decided procure plant in ras al-khair , other plants contractors , operate them through swcc, had been case before iwpps introduced. ras al-khair opened in 2014 largest desalination plant in world, built @ cost of $7.2 billion.

in 2016 wec planned become again offtaker iwpp, al kahfji solar desalination plant built advanced water technology (awt). awt contractor of plant , become operator under proposed off-take plan. large desalination plan on drawing board jeddah 4 plant implemented iwpp, although pre-bidding normal construction contract had been initiated.

the water & energy company

the water & energy company, created in 2003, off-taker desalined water produced privately operated desalination plants. jointly owned swcc , saudi electricity company (sec).

project finance wastewater treatment plants

project finance, i.e. financing secured projected revenue stream of project, has been commonly used finance wastewater treatment plants in saudi arabia. in may 2002 first wastewater contract in saudi arabia financed in way, in case bot contract, awarded consortium of local firms. consortium rehabilitate, operate, maintain , upgrade wastewater system of jeddah industrial city on period of 20 years , invest us$32 million. government has awarded many more bot wastewater treatment contracts since then, based on revenue stream of long-term sales agreements treated wastewater sold major customers.