A consortium of Malaysian and Saudi Arabian companies has signed a contract with the Saudi Ministry of Water and Electricity for the development of an independent water and power project on a build, own and operate basis.

The Saudi-Malaysia Water & Electricity Co (SAMAWEC), comprising Tenaga Nasional Bhd (TNB), Malakoff Bhd, Khazanah Nasional Bhd and Arabian Company for Water & Power Project Ltd (ACWA) has announced that EPC partners Siemens and Doosan Heavy Industries will build the plant.

The SR 9.129 billion ($2.43 billion) Shuaibah Phase III Water and Power project will comprise a 900 MW power plant that will also produce 880,000 cum of water daily for the areas of Makkah, Jeddah, Taif and Al Baha. The project is to be located 110 km south of Jeddah on the western Red Sea coast of Saudi Arabia adjacent to the existing Shuaibah generation and desalination facilities.

With some $2.0 billion of the financing expected to come via project finance, the development of Saudi Arabia’s first privatised power and water desalination project is due for completion in 2009.