DUBAI- Saudi Arabia has suspended the privatisation of the Ras Al Khair desalination and power plant, one of a number of state assets that the government aimed to sell to reduce pressure on capital spending and diversify revenues away from oil.
"This decision was made in order to capitalise on knowledge and capacity built in the Kingdom as a result of many years of experience in the areas of water desalination, new technologies, R&D (research and development) and supply chains", said the Privatization Supervisory Committee for the Environment, Water and Agriculture sectors.
"A new engagement strategy and plan for the Saline Water Conversion Corporation (SWCC) assets such as Ras Al Khair plant will be announced shortly," it said in a statement on Monday on the website of the Saudi national centre for privatisations.
SWCC had hired advisers to help it sell the $7.2 billion Ras Al Khair desalination plant, sources told Reuters previously.
In January, it said that seven companies and consortia had been invited to submit bids for the plant, with the winner expected to own 60% of the project company and handle its management, operations, and maintenance.
Desalination is expensive and energy-intensive but is relied upon in hot, water-scarce climates like Saudi Arabia and neighbouring Gulf countries.
The privatisation committee said that it will continue to engage investors in future public-private partnerships and privatisations in the water sector.
(Reporting by Davide Barbuscia; Editing by Kirsten Donovan) ((Davide.Barbuscia@thomsonreuters.com; +971522604297; Reuters Messaging: email@example.com))