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Saudi Arabia’s capital city is preparing to utilize gas, rather than oil, to generate electricity
Riyadh, 28th August 2001

 Saudi Arabia’s capital city is preparing to utilize gas, rather than oil, to generate electricity and to facilitate industrial production from the beginning of next year.

The move is part of the government’s efforts to expand its gas network to the Central Province and other parts of the country. The project, according to Sulaiman Muhammad Al-Kholaify, chairman of the Gas Distribution Company, will cut the cost of fuel by 80 to 90 percent compared to the value of gas presently used by industries and electricity plants throughout the city, and reduce both maintenance charges and environmental pollution.

“It will also lead to the establishment of new factories in the city, as it reduces the cost of production,” he added.

The new project comes after Saudi Arabia signed accords with eight international oil companies on June 3 to develop its gas fields. The gas deals, to carry out three core ventures in the southeastern, western and northwestern parts of the country, will bring in a minimum direct investment of SR75 billion ($20 billion).

At present, gas is widely used in the Eastern Province for its electricity and desalination plants and industries. The availability of gas at competitive prices will boost industries specializing in transforming methane, ethane, propane, butane and benzene into value added products.

The development of gas also provides good opportunities for local contractors. The Saudi firms, in cooperation with international engineering companies, will take part in the construction of new industries either as main contractors or subcontractors for civil, mechanical, electrical, plumbing, safety, communication, maintenance and other works.

MacConnel Doyle Saudi Arabia Ltd., a company specializing in gas projects, is scheduled to complete the gas pipeline project by the beginning of next year to supply natural gas to the seventh electricity power plant and to the industries located in the second industrial city in Riyadh. The project is estimated to cost SR25 million.

Al-Kholaify said the project will link the pipeline with Saudi Aramco’s gas pipeline that comes from the Eastern Province. In the first phase, the project will benefit 25 factories, he said, and added that more industries will make use of the facility in the future.

Al-Kholaify emphasized the importance of using methane gas that is clean and environmentally friendly and gives high levels of heat economically. It is used mainly in the iron and steel industries, the building materials industry and the chemical industries.

Source: © Arab News

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28 August, 2001 03:58:44 PM

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