Acwa, Saudi Energy Co. sign $3bn PPA for Rabigh 2 gas plant

20/04/2026 03:41 AST

Saudi utility giant Acwa and Saudi Energy Co. have signed a 31-year power purchase agreement with the Saudi Power Procurement Co. for the Rabigh 2 Independent Power Producer Expansion project.

In separate Tadawul filings, Acwa and Saudi Energy Co. said the agreement, valued at SR11.5 billion ($3.07 billion), includes the development, financing, construction, ownership, and operation of a large-scale combined-cycle gas turbine power plant with a generation capacity of 2,313.5 MW.

Both Acwa and Saudi Energy hold a 40 percent effective shareholding each in the project.

Rabigh 2 is a greenfield project located in Makkah province, on the western coast of Saudi Arabia, around 130 km north of Jeddah, adjacent to the existing Rabigh IPP.

This development aligns with Saudi Arabia's Vision 2030 goals to expand power generation capacity while incorporating cleaner technologies, including readiness for carbon capture units. The Kingdom aims to increase the share of renewables to 50 percent in its power mix by 2030 and achieve net zero by 2060.

The Tadawul filings added that the agreement also covers the development, financing, and construction of an extension to a 380 kV electrical substation.

The financial impact from the project's operations will be announced once it reaches financial close, both companies said.

In December, Acwa completed the refinancing of the Rabigh 3 Independent Water Project located in the western region of the Kingdom.

Rabigh 3 Co. is a desalination plant owned by Acwa, with a capacity of 600,000 cubic meters per day of potable water output using reverse osmosis technology.

Yanbu wind deal
In a parallel development, Al Yamama Steel Industries Co. signed an agreement with SEPCOIII Electric Power Construction Co. to supply wind towers for the Yanbu Wind Farm Project.

The deal, signed under the auspices of the Ministry of Energy, includes a localization rate exceeding 80 percent, reflecting efforts to strengthen domestic manufacturing and increase local content in large-scale clean energy projects.

In an X post, the ministry said the development marks another step forward in the Kingdom's drive to localize its renewable energy sector under Vision 2030.

Arab News