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Saudi Arabia’s Energy Ministry has invited bids for a 400-MW wind power plant to be built in northwestern Saudi Arabia. According to the press release, the Dumat Al Jandal wind power plant will be the first utility-scale wind project in the Kingdom.
The plant’s construction is part of a large-scale program to shift away from the Kingdom’s heavy reliance on oil and gas, stipulated in the Vision 2030 initiative. The shift from fossil fuels to renewables will cost some US$50 billion, to be distributed over the next decade. Plans are to have a tenth of the Kingdom’s power generated by renewable energy sources by 2023. This means 9.5 GW of installed capacity needs to be built by that year.
Interested companies will have until August 10 to present their qualifications to the ministry. On August 29, the ministry will start the process for request for proposals, which will continue until January 31, 2018. Two months ago, Energy Minister Khalid al-Falih said that the ministry had shortlisted 51 companies as eligible to bid on renewable energy projects.
Also in April, Al-Falih said that this year Riyadh will tender wind and solar power projects with a combined capacity of 700 MW. Of the 51 eligible companies, 24 were approved as bidders for the 400-MW wind power plant, and the rest were approved for solar power projects.
The short list includes Italy’s Enel, French Total and Electricite de France, as well as Spanish Iberdrola and Acciona. The rest of the eligible bidders come from the Middle East and Asia. The solar power tender was launched in April, and the ministry will announce the winners this November.
Both the solar and wind power projects will be built under power purchase agreements: a 25-year one for the Sakaka solar project, and a 20-year one for the Dumat Al Jandal wind projects.
By Irina Slav for Oilprice.com
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Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.