Boston, MA -- (SBWIRE) -- 06/21/2013 -- The plans for further expansion in the Saudi water market are well underway, creating opportunities across all sectors and regions as privatization plans and government investment continue. Further increases in government investment and long term security in fund liquidity in the market were seen when the Minister of Water and Electricity, Abdullah Al- Hussayen, announced in January 2013 that the government has allocated US$6.4bn for water and sanitation projects in 2013 alone and committed over $66 billion to long-term capital investments over the next 10 years.

Saudi Arabia has solidified its place as a major player in the world water market as the pressure on the existing water system continues to mount, prompting large investment from Saudi government. In addition to the basic provision of water services to the public, an expansionary economic policy, active construction sector and water intensive operational developments in the oil and gas industry create an increased urgency in Q2 2013.

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Marked by a rapid rate of investment and an aggressive project completion schedule, the Saudi water market continued to present opportunity for both national and international companies during Q3 2013. Despite the improvement within the water market seen by the completion of the key Jeddah desalination plant, the mounting market pressure means that the pace of development must continue at this rate.

BMI is confident that the measures undertaken to date are sufficient to ensure that that equilibrium will be maintained beyond our five-year forecast period to 2017 and existing water resource needs will be met. Yet with growth in population continuing to burden the existing system the question remains as to whether the Saudi government's capital commitments will be liquid enough to support the water intensive economies of construction and oil and gas to reach their full potential.

The key themes in Saudi Arabia's water sector are:

- Improved capacity in Jeddah, as National Water Compan (NWC) reporting it is now receiving additional resources from the expanded desalination plant in Jeddah at an anticipated rate of 240 thousand m3/day.
- Continuation in the privitization of the water market, with Alstom securing a contract worth nearly EUR750mn (US$970mn) for equipment supply at the Yanbu 3 power and desalination plant. In addition KPMG, in partnership with Aecom, has been awarded an advisory contract by the NWC on the privatization of some of its wastewater assets.
- Growth in activity from nationally owned companies is likely to continue to pick up in Q3 with Saline Water Conversion Corporation (SWCC) announcing plans to construct a desalination plant in Rabigh, north-west of Jeddah. This will be the largest desalination plant in the world having a capacity of 600,000 cubic metres of water per day. The project is scheduled to begin in Q114, with completion due in 2018

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