• Expected GE scope of supply over $1 billion, following up on major deal announced in December.
ATLANTA, Jan. 31, 2007 -- GE Energy today announced its second set of commitments in less than two months for major power plant projects in Saudi Arabia.
GE's scope of supply for the new projects is expected to total more than $1 billion by the time the projects are completed. GE signed a new agreement for the Marafiq power generation and water desalination project. Among the parties to the project agreement are SUEZ, Arabian Company for Water and Power Projects and Gulf Investment Corporation G.S.C. GE has entered into a second project agreement for the Riyadh Power Plant No.9 with Saudi Electricity Company.
These commitments follow GE's Dec. 14, 2006, announcement that it had signed three contracts with Saudi Electricity Company valued at more than $950 million for the Qurayyah, Faras and Riyadh Power Plant No. 8 Extension projects in Saudi Arabia. Saudi Electricity Company has recently committed to GE to add service contracts covering maintenance activities on these projects.
"We are extremely pleased that our technology again has been selected to help the Kingdom of Saudi Arabia meet its growing electricity requirements," said Steve Bolze, president of power generation for GE Energy. "The projects announced today combined with the projects announced in December represent a total value to GE of approximately $2 billion."
"As these projects clearly indicate, Saudi Arabia continues to be a very important part of GE's overall growth plans for the Middle East," said Abdullah Taibah, region executive for GE Energy. "Saudi Arabia's electricity use has been increasing at a rate of about seven% a year and the Industry and Electricity Ministry estimates that the Kingdom will require up to 20 gigawatts of additional power generating capacity by the year 2019. We are committed to helping our customers in Saudi Arabia meet this demand for reliable power."
For the Marafiq project, located in Jubail Industrial City of Saudi Arabia's Eastern Province, GE is part of an EPC consortium that also includes Hyundai Heavy Industries Co. Ltd. and Société Internationale de Déssalement.
Plans are for GE to supply four combined-cycle power blocks including twelve Frame 7FA gas turbines. Net plant output is targeted at more than 2,740 megawatts, with steam extraction for desalination. The GE scope of the project would also include steam turbines, generators, auxiliary equipment, heat recovery steam generators, distributed control systems, design and engineering, project management, technical advisory services, performance testing and training and plant maintenance.
Equipment for the Marafiq project would be shipped from the end of February 2008 through the end of January 2009. Block 1 is scheduled to enter commercial service during the second quarter of 2009, block 2 in the third quarter of 2009, block 3 during the fourth quarter of 2009 and block 4 during the first quarter of 2010. Primary fuel is natural gas, with distillate oil as a backup.
The new facility is to be owned 20% by Suez-Tractebel S.A., 20% by Gulf Investment Corporation, 20% by Arabian Company for Water and Power Projects, 30% by Marafiq (Power & Water Utility Company for Jubail and Yanbu), five% by Saudi Electricity Company and five% by Saudi Public Investment Fund. Marafiq is conducting this project as part of a series of projects to produce power and water for a very much increasing demand in support of a booming industrial economy in the Kingdom.
For the Riyadh Power Plant 9 project, GE plans to provide twelve Frame 7EA gas turbines, along with technical advisory services and performance testing. The EPC contractor is Arabian BEMCO, based in Jeddah, Saudi Arabia. The project would expand the site's power generation capacity by more than 660 megawatts. This additional output is to be used to help offset a power shortfall expected in 2008 for the Central Area of Saudi Arabia.
The gas turbines for the Power Plant 9 project are scheduled to be shipped during the second half of 2007 with the units expected to enter commercial operation between February and June of 2008. Primary fuel for the expansion project is crude oil.
GE's facilities in Greenville, S.C. manufacture the gas turbines for both projects while the steam turbines for the Marafiq project will be built in Schenectady, N.Y.
GE's gas turbine technology already is well established in Saudi Arabia. Since 2003, the company has supplied nearly 80 gas turbines for projects across in the Kingdom.
GE Energy (www.ge.com/energy), a division of General Electric, is one of the world's leading suppliers of power generation and energy delivery technologies, with 2005 revenue of $16.5 billion. Based in Atlanta, Georgia, GE Energy works in all areas of the energy industry including coal, oil, natural gas and nuclear energy; renewable resources such as water, wind, solar and biogas; and other alternative fuels. Numerous GE Energy products are certified under ecomagination, GE's corporate-wide initiative to aggressively bring to market new technologies that will help customers meet pressing environmental challenges.
GE's Water & Process Technologies (www.gewater.com), a unit of GE Infrastructure, another GE division, is an industry leader in solving the world's most pressing water reuse, industrial, irrigation, municipal, and drinking water needs. Through desalination, advanced membrane, separation solutions, and water reuse and wastewater management and process technologies, GE delivers added value to its customers. By improving performance and product quality, reducing operating costs, and extending equipment life through a broad range of products and services that are designed to optimize total performance; protect customers' assets; prevent fouling and scaling; and safeguard the environment through water conservation and energy reduction. It has 800 patents and over 500 more pending on research and development accomplishments in water, wastewater and process systems solutions.
Marafiq (www.marafiq.com.sa) is the first utilities private company in Kingdom of Saudi Arabia. Headquartered in Jubail Industrial City, its services also include the services provided to Yanbu Industrial City. Formed by a Royal decree to serve the Industrial cities needs for water requirement as well as power supply and distribution in Yanbu Industrial City. An ISO certified firm, focusing on production while preserving sustainable environment.
SUEZ (www.suez.com), an international industrial group, designs sustainable and innovative solutions for the management of public utility services as a partner of public authorities, businesses and individuals. The group aims to meet essential needs in electricity, natural gas, energy services, water and waste management. SUEZ is listed on the Brussels, Luxembourg, Paris, New York and Zurich stock exchanges and is represented in the major international indices: CAC 40, BEL 20, DJ STOXX 50, DJ EURO STOXX 50, Euronext 100, FTSE Eurotop 100, MSCI Europe and ASPI Eurozone. The group employs 157,650 people worldwide and achieved revenues of EUR 41.5 billion in 2005, 89% of which were generated in Europe and in North America. SUEZ is an official sponsor of the French National Soccer Team.
SUEZ Energy International (SEI) is one of the four business lines of SUEZ. With headquarters in Brussels, SEI offers global solutions in energy and services to customers in North America, the southern cone of Latin America, Asia and the Middle East. It develops, builds and operates energy facilities both in electricity and gas, including liquefied natural gas (LNG). It transports and distributes natural gas and LNG in several countries outside Europe. SEI is also active as a trader around its assets and as a marketer in electricity and gas, and offers energy related services to industrial and commercial customers.
ACWA Power Projects, established in 2004, is the leading developer of IWPP Projects in the Kingdom of Saudi Arabia. ACWA is the largest private sector shareholder in the Shuaibah IWPP and is also one of four investors in Rabigh IWSPP both of which are currently under construction. It is the largest shareholder and lead developer of Shuqaiq IWPP transaction which is due to achieve Financial Close in the first quarter of 2007 and is also an equal private sector shareholder with two other partners in Marafiq IWPP which is also now in financing stage. With this rapidly growing portfolio of projects, the company is focused on delivering value through developing, owning and operating infrastructure assets for the provision of desalinated water and electrical power.
Gulf Investment Corp. (www.gic.com.kw) was established in 1983 and is equally owned by the six member states of the Gulf Cooperation Council. GIC provides a range of financial services that support the development of private enterprise and economic growth in the region. GIC is an investor in Al-Ezzel IPP, in Bahrain, Ras Laffan IWPP, in Qatar and in United Power Company, in Oman. It is also active in providing financial advisory services to the power sector in the region. GIC is one of the most highly capitalized financial institutions in the region. As at end 2005, GIC had total assets exceeding USD7.4 billion and shareholders' equity of about USD1.6 billion.