Dussur and GE sign power sector joint venture worth more than SAR 1 billion
- In line with Saudi Vision 2030, Dussur and GE support Saudi Arabia’s growing industrial sector
- Dussur and GE partner to localize the manufacturing of gas turbines in Dammam
Riyadh, Saudi Arabia; May 24, 2017: Dussur (formerly operating under the name Saudi Arabian Industrial Investments Company) and GE (NYSE: GE) have signed a joint venture agreement worth more than SAR 1 billion. This announcement follows the Summit held earlier this week between His Royal Highness King Salman bin Abdulaziz Al Saud and U.S. President Donald Trump and is part of the announcement GE made on May 20.
The agreement represents significant progress towards achieving the Saudi Vision 2030 by continuing to localize gas turbine manufacturing in Saudi Arabia and helping to further develop a global industrial supply chain for the energy sector. It follows a strategic Memorandum of Understanding signed between Dussur and GE last year that is expected to result in nearly SAR 3.75 billion of co-investment by the two companies across multiple sectors in 2017.
The joint venture will create the capacity to supply the majority of Saudi Arabia’s annual demand for gas turbines needed to satisfy the Kingdom’s growing electricity demands. This investment will create added economic value, contribute to the national economy, and boost the local supply chain to benefit Saudi small and medium enterprises (SMEs). Under this agreement, GE and Dussur will strengthen ‘Made in Saudi’ capabilities by expanding manufacturing processes specifically around gas turbine component technology.
Commitment to economic growth
H.E. Abdullatif bin Ahmed Al-Othman, Chairman of Dussur commented: “This landmark partnership between Dussur, a strategic industrial investments and development company, and GE, world renowned technology leader, underlines the commitment of Saudi Arabia to be a global player in the industrial sector in line with the goals of Saudi Vision 2030. This joint venture will contribute to stronger localized manufacturing ecosystems in Saudi Arabia. By creating a global supply chain we can unlock new growth opportunities that benefit the people of both nations.”
“In line with Saudi Vision 2030, Dussur has been established to be a driver of economic diversification, value creation and talent development,” said Rasheed Al-Shubaili, CEO of Dussur. “Dussur works with global partners to create a dynamic industrial ecosystem in the Kingdom that will strengthen Saudi Arabia’s economic competitiveness. Through the strength of our partnerships inside the Kingdom, our agility and our local market knowledge, Dussur is an investment partner that can enhance an international company’s reach into Saudi Arabia and the regional market. With this joint venture, we are setting a global model for building industrial ecosystems that supports the growth of local economies. These investments and opportunities strengthen the Kingdom’s position as a manufacturing hub for the energy industry.”
Paul McElhinney, President & CEO, GE’s Power Services, GE Power said: “The joint venture underscores GE’s firm commitment to the Kingdom’s Vision 2030, building on its key business growth priorities and emphasizing the growing importance of localization. The reciprocal investment between nations is a natural progression of a fundamentally strong partnership, taking the collaboration to new heights and allowing for the acceleration of key infrastructure projects and their subsequent impact on jobs, supply chains and overall economies.”
Joe Mastrangelo, President and CEO, GE’s Gas Power Systems, GE Power said: “This agreement builds off of GE’s eight-decade history in Saudi Arabia. We are expanding our state-of-the-art local manufacturing capabilities and have the ability to build a wide range of gas turbines in the Kingdom. Together with Dussur and in support of Vision 2030, we will better serve our customers in the Kingdom and across the region as the demand for power continues to grow.”
The World Energy Council estimates that the GCC will require 10 gigawatts (GW) of additional power over the next ten years, marking an investment of over SAR 180 billion in new power generating capacity. Across the region, demand for power is increasing at an average annual rate of 8 percent. The agreement is expected to have impact on the Saudi economy as the investment in the energy sector by Dussur and GE will help to address these needs by supplying essential equipment for the power generation sector.