Saudi Arabia has no permanent running surface water and experiences an average of 100 mm of rainfall per year, with this largely concentrated in the south-western mountains during the summer months. Traditionally, the country relied on wells drilled into non-renewable subterranean aquifers and surface run-off for its freshwater needs, and the agriculture sector in particular remains reliant on these resources. However, over recent decades water desalination has become increasingly central to provision; approximately 60% of municipal households relied on water from coastal desalination plants as of 2017, according to the Ministry of Environment, Water and Agriculture (MEWA).

The desalination process is, however, expensive and consumes very high volumes of energy, which – owing to the Kingdom’s energy mix – largely derives from fossil fuels. Government subsidies long hid these costs from end-users, which in turn contributed to rising per capita daily consumption levels. These peaked at 270 litres in 2016, according to figures from General Authority for Statistics (GaStat).

In order to address these issues and strike a more favourable balance between sustainability and supply, the government is undertaking a number of measures to address the growing demand for water, while at the same time attempting to reduce per capita daily usage. Vision 2030 – the Kingdom’s long-term economic diversification and development roadmap – similarly establishes a number of goals aimed at increasing the proportion of the population that is connected to the national water network, both for the supply of fresh water and for the disposal of grey water and sewage.

Agricultural Use

Researchers at the King Fahd University of Petroleum and Minerals calculated that in 2016 there were reserves of between 259bn and 761bn cu metres of non-renewable groundwater in the Kingdom’s aquifers, with rainfall contributing 886m cu metres a year to the system and 1.45bn cu metres of run-off rainwater collected by 302 dams each year. By comparison, the country produced 1.06bn cu metres of desalinated water that year.

Beginning in the 1970s Saudi Arabia started to expand its agriculture sector in pursuit of food security, but in the subsequent three decades 80% of its non-renewable subterranean aquifer system was depleted. While agricultural policy has since changed, with fish farming and fruit cultivation replacing water-intensive cereals, additional modifications are likely needed to create a more sustainable water utilisation strategy.

According to MEWA, agriculture accounted for 82% of the 23.4m cu metres of water consumed in 2017, while municipal usage comprised 13.7% and industry made up another 4.3%. Roughly 78% of this water was derived from non-renewable groundwater – only slightly less than in 2013, when the figure stood at 80% – though overall output and consumption have both risen.

Domestic Use

According to the 2018 household energy survey published by GaStat, 78% of the population is connected to the public freshwater network, while 20.1% are reliant on tanker deliveries for their household water needs and 1.71% depend on wells. Despite these connection rates, 62.3% of the population drinks only bottled water, with just 18.3% using the public network’s water supply and 18.8% using tanker deliveries for drinking water.

Some 61.5% are connected to the public sanitation network, while 38% use septic tanks and 0.5% use a private sanitation network. Safely and hygienically disposing of waste from the country’s septic tanks has caused consistent logistical issues for the Kingdom. For example, between the mid-1990s and 2008 an estimated 800 tankers dumped 40,000 cu metres of untreated wastewater every day in Al Misk Lake, located at Wadi Bani Malik, 40 km east of Jeddah. Geochemical samples taken of the surrounding groundwater in 2016 – eight years after dumping at the site ceased – found considerable contamination of the groundwater, rendering the site unsuitable for irrigation or agriculture purposes.

Waste Investments

The government has been making efforts to address these water-treatment issues; the volume of treated sewage rose from 66% in 2011 to 77% in 2014, and is expected to reach 80% by 2019, according to MEWA. This is being supported by a drive to expand the Kingdom’s wastewater processing infrastructure, with the number of sewage treatment plants expected to rise to 204 in 2019.

In December 2018 the National Water Company (NWC) announced it had almost completed a SR72m ($19.2m) project to connect homes in the southern Hada district of Jeddah to the national sewage system. Some 27 km of new pipelines were being laid to connect roughly 1770 properties to the network. In the same month the NWC completed three sewage projects with a combined value of SR358m ($95.4m) at Yanbu in the Medina region. The new facilities serve 6000 properties and included three pumping stations, 87 km of expulsion lines and two lift stations. Furthermore, in November 2018, 18 new water and sanitation projects were inaugurated in Tabuk Province, at a combined value of SR1.45bn ($387m). These included nine sanitation schemes with a cost of SR850m ($227m), 214 km of sewage networks, 7720 domestic sanitation connections, as well as 1270 km of drinking water networks and around 14,200 residential water connections. In addition, four dam projects were unveiled in the region, with a storage capacity of 5.9m cu metres; along with four new desalination plants, which will have a combined capacity of 120,000 cu metres per day.

Private Sector

To achieve its infrastructure expansion objectives, the Water and Electricity Company (WEC) has turned to public-private partnerships (PPPs). The state-owned utility company first invited expressions of interest in its water and sanitation projects in December 2017, through two independent sewage treatment plant (ISTP) proposals, which are similar to independent water and power projects in terms of organisation and ownership structure. They are to be developed under a 25-year sewage treatment agreement with the WEC that is guaranteed by the state, with the sewage capacity to be provided by the NWC.

The first two projects being developed under this model are the 300,000-cu-metre-per-day plant in Dammam and the 500,000-cu-metre-per-day Jeddah Airport ISTP 2, which will be built adjacent to a pre-existing 350,000-cu-metre-per-day sewage treatment plant. The latter was originally tendered in 2012 and again in 2015 using an engineering, procurement and construction (EPC) project, before being reopened to bidders as a PPP in December 2017, marking a shift that could herald greater private investment in water treatment.

“Privatisation initiatives are gaining momentum under Vision 2030,” Essam Zahra, CEO of the private domestic firm National Water Works Company, told OBG. “However, there needs to be a more of a push towards establishing PPP contracts, rather than traditional EPC contracts in order to sustain growth.”

Efforts to foster private sector activity and international investment are bearing some fruit. In July 2018 the WEC announced it had received bids for the Dammam ISTP from seven international consortia, and in late January 2019 it awarded the contract to the Dubai-headquartered global utilities player Metito. The Jeddah Airport ISTP 2 project, however, was ultimately awarded to a local actor. The WEC issued a request for bidding to nine pre-qualified consortia in April 2018 and inked an agreement in February 2019 with a consortium led by the Power and Water Utility Company for Jubail and Yanbu.