Saudi Arabia, Siemens Energy ink $1.5 billion deal for gas-powered plants
The initiative aims to significantly reduce carbon emissions by as much as 60 per cent
Dubai: Saudi Arabia signs a $1.5 billion (Dh5.5 billion) deal with German company Siemens Energy to supply technology for two upcoming gas-fired power plants.
These plants, Taiba 2 and Qassim 2, set to be located in the west and central regions of Saudi Arabia, will jointly generate four gigawatts of electricity, sufficient to power approximately three million homes.
Siemens Energy announced in a statement that construction of the plants will commence "over the next few years", with plans for grid connection by 2026. The agreement includes a 25-year maintenance contract for the sites. China Energy International Group will partner with Siemens for engineering, procurement, construction, and contracting on these projects.
The initiative aims to significantly reduce carbon emissions by as much as 60 per cent compared to oil-fired alternatives and aligns with Saudi Arabia's strategy to incorporate CO2 capture and storage facilities. This move supports the country's broader plan to transition towards renewable energy sources and gas-fired power plants as part of its goal to achieve net zero emissions by 2060.
Saudi Arabia, a large crude exporter and the fourth largest crude consumer after the US, China, and India, currently consumes 3.7 million barrels of oil per day. To meet rising domestic gas demand and enhance energy infrastructure, the government plans to invest $10 billion (Dh36.7 billion) in upgrading its primary gas system.