French engineering group Alstom has signed a letter of intent with Saudi Electricity Company (SEC) for a €1.9 billion ($3 billion) turnkey contract to build a new 1,200 MW steam power plant in Saudi Arabia.

The plant will be built adjacent to the existing Shoaiba power station, 100 km south of Jeddah. Following the project, the Shoaiba power plant will comprise 14 units of 400 MW each, bringing the total output to 5,600 MW. The contract will be finalised in the coming months, said an Alstom statement.

The agreement marks the third stage of the Shoaiba project. The previous 11 units were supplied by an Alstom-led consortium on a turnkey basis under two separate contracts won in November 1998 and January 2004 respectively.

Under the new contract, Alstom will design, supply, install and commission the entire plant, including boilers, STF40 steam turbines, Gigatop 2-pole turbogenerators, sea-water flue gas desulphurization systems for removal of SO2 and the complete balance of plant and systems for the three units. Alstom’s consortium partner, Saudi Archirodon, will carry out all the associated civil works. The boilers are designed to burn both crude and heavy fuel oil and will use Alstom’s advanced low NOx tangential firing technology, it said.

Delivery of major equipment is scheduled in 2010.

Electric power demand in Saudi Arabia is growing at around 7 per cent each year, requiring massive investment in the country’s power generation capacity, said the statement. –TradeArabia News Service