Saudi sets up firm to oversee water privatisation

Saudi Arabia has set up a water company to oversee privatisation of expensive sewerage services and efforts to save dwindling water resources.

Minister of water and electricity Abdullah bin Abdul-Rahman Al-Husayen said the National Water Company would be wholly owned by the Public Investment Fund.

It will assume control of all the kingdom's groundwater wells and sewage and desalination plants, which were previously in the hands of various government bodies in a convoluted system.

The new firm also will take charge of privatising urban water and sewerage services. The winner of a tender for Jeddah will be announced in three months, Al-Husayen said, and tenders will be held for Saudi Arabia's other big cities within three years.

No reason has been given for the delay in deciding on bids which first came in two years ago and include France's Veolia and Suez, Britain's Thames Water and Singapore Utilities International.

Al-Husayen said National Water has chosen a foreign firm, which he did not name, to manage the national water network in a five-year contract that includes incentives to devise ways of preventing water wastage.

National Water has a paid-up capital of 6 billion riyals ($1.6 billion) and the remainder of its 22 billion capital will be paid in three years, he said.