New agreements have been signed  to expand Saudi Arabia's Shuaiba Independent Water and Power Project.

The Water and Electricity Company (WEC), ACWA Power Projects Company and a consortium of Malaysian companies have signed a series of deals.

This is the second phase of the project that aims to deliver 150,000 cubic metres of water per day to WEC under a 20-year water purchase agreement beginning in February 2009.

The other signatories to the agreement include Malaysian companies such as Tenaga Nasional Berhad, Khazanah Nasional Berhad and Malakoff Corporation and Public Investment Fund.

“The SR870 million expansion project will utilise the reverse osmosis desalination technology at a site adjacent to the main project at Shuaiba on the Kingdom’s western coast,” Governor Fahd Al Shareef of the Saline Water Conversion Corporation (SWCC) said.

His remarks, reported in the Arab News, came at the end of the signing ceremony.

“A particular challenge faced by this project is the requirement to deliver an additional supply of water to augment a much-needed water supply to Jeddah, Makkah, Taif and Al Baha as early as possible,” he said in the report..

Doosan Heavy Industries and Construction will construct the project under a lump-sum-fixed-price-turnkey contract.

It will be operated by an operation and maintenance company owned by ACWA Power Projects, the three Malaysian partners and the First National Operation and Maintenance Company.

A combination of equity and debt is funding the project with debt financing and equity bridge facilities being provided by Bayern LB, Al Rajhi Bank and Gulf International Bank. Bayern LB is leading the group.

The proposed plant will be built on a reclaimed land close to the Shuaiba 111 Independent Water and Power Project complex.