[Edaily Reporter Kim Hyung-wook] #Korea Electric Power Corporation (KEPCO) has secured a contract for the second phase of the Jafurah combined heat and power (CHP) project in Saudi Arabia, which is expected to generate total revenue of 2.1 trillion won.

According to KEPCO on the 3rd, the company recently signed a power and steam sales contract with Saudi Aramco, the state-owned oil company, for the Jafurah Phase 2 combined heat and power plant. It has also finalized a construction contract with #Doosan Enerbility, which will be responsible for building the plant.

This project involves building the infrastructure necessary to supply electricity and steam for the development of the Jafurah natural gas field, which is currently being carried out by Saudi Aramco. A combined heat and power (CHP) plant is a facility that generates electricity and recovers the heat generated during that process to supply steam.

Following its successful bid for the Jafurah CHP Phase 1 project through an international competitive tender in 2022, KEPCO has now secured the contract for the Phase 2 project, which expands on the initial phase. The Phase 1 project is scheduled for completion by the end of this month.

An KEPCO official stated, “We secured the Phase 2 project on our own by demonstrating our capabilities through the successful execution of Phase 1 and building trust with the client.”

Under this contract, KEPCO will construct a combined heat and power plant with a generating capacity of 331 megawatts (MW) and a steam production capacity of 465 tons per hour by June 2029, and will supply electricity and steam to the local area for the following 17 years. KEPCO expects to generate total revenue of $1.4 billion (approximately 2.1 trillion won) during this period.

A special purpose company (SPC) jointly established by KEPCO and Aramco will operate the project. Additionally, Doosan Enerbility will handle the power plant construction, while the Korea Export-Import Bank will provide financing. The combined export value for domestic companies, including Doosan Enerbility, is expected to reach 1.2 trillion won.

Starting with the award of the 1,200 MW Rabigh heavy oil-fired power plant project in 2009, KEPCO has secured the 317 MW Jafurah Combined Heat and Power (CHP) Phase 1 project in 2022, the 2,000 MW Sadawi solar power project and the 3,780 MW Ruma 1 and Nayriya 1 gas-fired combined-cycle power projects in 2024, and the 1,500 MW Dawadmi wind power project in 2025, thereby establishing a firm foothold in the Saudi power market. The company is also preparing to secure additional contracts for follow-up cogeneration projects scheduled to be tendered by Aramco in the second half of this year.

An KEPCO official stated, “We will use this contract win as an opportunity to accelerate our expansion into the Middle East across various energy sectors, including gas-fired combined cycle, new and renewable energy, power grids, and energy storage systems (ESS).” The official added, “As a leading public energy corporation, we will also play a central role in forming ‘Team Korea’ with domestic companies to increase joint market entry.”