GE eyes slice of Saudi's nuclear energy sector

Kingdom plans to spend $300bn in building 16 nuclear reactors over next two decades
GE eyes slice of Saudi's nuclear energy sector
NUCLEAR ENERGY: said last week it would invest $300bn in building 16 nuclear reactors over the next two decades (Getty Images - Image for illustrative purposes only)
By Shane McGinley
Sun 05 Jun 2011 10:10 AM

General Electric Co (GE) will look to secure nuclear power contracts with Saudi Arabia’s government as the Gulf state seeks keep pace with rising power demands, the CEO of GE’s energy division said.

The world’s largest oil exporter said last week it would invest $300bn in building 16 nuclear reactors over the next two decades, in a bid to meet 20 percent of its electricity needs.

Bids for each reactor, which will cost up to $7bn each to build, will be open to international companies, the government said.

“I think it is a great step [that] they have put out that announcement,” said Joseph Anis, president and CEO of GE Energy in the Middle East. “The first step is the governments start talking to each other and put their policies in place. Once that happens, nuclear manufacturers will come in and start supporting those programmes and participating in their tenders. As they launch that, we will certainly be there to participate.”

The news demonstrates Saudi has no plans for a policy reversal on nuclear energy, following the Fukushima disaster in Japan. Germany last week said it would shut down all 17 nuclear plants under an accelerated exit from atomic power.

Anis said he did not see the decision as a move away from atomic power but said countries would look to avail of the latest technologies and safety measures.

“That plant [Fukushima] was built and designed over 30 years ago. I think as technologies have evolved and security measures have evolved countries will look at that.”

Saudi Arabia is GE Energy’s largest equipment customer. The firm has installed 500 gas turbines in the kingdom, which generate around half of the country’s electricity.

GE has opened a $100m plant in Dammam to build and repair turbines for power generators, and plans to invest a further $150m in expanding the facility over the next three years.

The 10,000 sq m facility, which has created more than 1,000 jobs in the kingdom, will serve customers in the wider Middle East, Europe and Africa.

Speaking at the launch, GE vice chairman John Krenicki said he expected to double energy revenue from Saudi Arabia in the next five years by increasing sales of gas power turbines.

With revenues in the region of $5.7bn last year, GE Energy has announced over $10bn in power generation equipment and services in the Middle East over the last two years.

These include a $2.6bn contract for a power plant in Kuwait, a $500m contract in Bahrain, a $1bn project in Riyadh and $3bn to supply power generation equipment in Iraq.

 

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