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Saudi’s SEC to Invest USD 27billion in New Projects

Middle East : 29 November 2013

Source: Zawya

The Saudi Electricity Company (SEC), one of the largest energy firms in the Middle East, is planning to invest nearly SAR 101 billion (USD 27 billion) in new electricity projects to address growing demand, according to a study to be presented to the Riyadh economic symposium in early December.

The study, published in the Arabic language daily Al-Riyadh on Wednesday, also added that the government-controlled SEC is constructing projects in power supply and related services worth more than SAR 100 billion (USD 26.6 billion).

The study, prepared by the council of Saudi chambers’, reported that plans include 174 projects worth SAR 67 billion (USD 17.8 billion) for power generation, 290 projects worth around SAR 24 billion (USD 6.4 billion) for power transportation and 170 ventures at a cost of SAR 10 billion (USD 2.6 billion) for power distribution within the Kingdom.

The report said SEC, which is owned 74.3 % by the Saudi government, is also executing 634 projects in the energy sector at a cost of more than SAR 100 billion. “Most of those projects have not been announced in the state budget because SEC is a joint stock company,” said the report.

The study, entitled “Problems facing the construction sector in Saudi Arabia and solution,” highlights the main factors contributing to failure of hundreds of government projects. This includes the absence of an effective higher council to oversee the sector, delay in the application of new technology in construction, weak supervision by the public and private sectors, the inefficient government purchasing and tender system and mismanagement of public projects.

Another major factor involves the fact that there around 2,326 authorized contractors in Saudi Arabia, the largest Arab economy with a population of around 29 million, and that they are unable to cope with the massive contracts offered by the government.

“These contracts along with a few foreign companies are not enough to deal with the current projects in the country, which are worth more than SAR one trillion (USD 266.6billion).”

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