SWA Signs USD 650 Million Financing Agreement to Construct Jubail and Khobar Desalination Systems

The Saudi Water Authority (SWA) signed a financing agreement with the Asian Infrastructure Investment Bank (AIIB) and the National Infrastructure Fund (Infra) to support a strategic project aimed at constructing desalination infrastructure for Jubail Phase I and Khobar Phase II, with a total value of USD 650 million. The agreement was signed on the sidelines of the 10th Annual Meeting of the AIIB Board of Governors, held in Beijing on June 26, 2025.

The commitment letter was signed by the Vice President for Technical Affairs and Projects, Eng. Sharekh Al-Sharekh; Chief Desalination Officer, Eng. Abdullah Al-Zowaid; Director General of Project and Corporate Finance at AIIB, Mr. Najeeb Haider; and Chief Financial Officer of Infra, Mr. Sattam Al-Juhani, in his capacity as Acting Chief Investment Officer.

The agreement builds upon a joint declaration signed earlier this year between AIIB and the Government of the Kingdom of Saudi Arabia, which established a framework for long-term collaboration in sectors such as water, sanitation, renewable energy, sustainable transport, and urban development. The project aims to convert Jubail Phase I and Khobar Phase II from traditional multi-stage flash (MSF) desalination technology to reverse osmosis (RO), which will enhance energy efficiency, increase water production capacity, and extend the operational life of both systems by approximately 20 years. This transformation directly supports the Kingdom’s sustainability and climate goals outlined in Saudi Vision 2030.

Khobar Phase II has already achieved a global milestone as the world’s largest seawater desalination plant using reverse osmosis technology, with a record daily production capacity of 670,852.4 cubic meters. The facility was built on the smallest land area compared to similar global plants, made possible by adopting advanced technical methodologies and value engineering principles.

According to the agreement, AIIB will provide financing exceeding SAR 1.6 billion (equivalent to USD 450 million), making it one of the largest non-sovereign corporate financings supported by the bank to date. This reflects the growing role of blended finance in enabling strategic infrastructure projects. Infra will contribute SAR 750 million (approximately USD 200 million) through a Murabaha corporate facility. The water sector is one of the priority investment areas for Infra, aligning with the Kingdom’s Vision 2030 goals.

Eng. Sharekh Al-Sharekh, Vice President for Technical Affairs and Projects at the Saudi Water Authority, said: “The agreement exemplifies an effective partnership between the Kingdom and international financing institutions to support the development of critical water infrastructure. This financing represents a significant step toward enhancing the water sector’s sustainability, increasing climate resilience, and improving the efficiency of national projects. It also reflects global confidence in the Kingdom’s capacity to implement high-impact initiatives that contribute to sustainable development and align with the infrastructure ambitions of Saudi Vision 2030.”

“This transaction demonstrates AIIB’s strong commitment to supporting sustainable infrastructure across the MENA region,” said Konstantin Limitovskiy, Chief Investment Officer of AIIB’s Public Sector (Region 2) and Project and Corporate Finance (Global) Clients.“By supporting the modernization of desalination assets, we are contributing to climate resilience, energy efficiency and long-term water security in Saudi Arabia.”

Sattam Al-Juhani, Acting CIO of Infra, added “This partnership with AIIB and SWA is a constructive step toward advancing international collaboration in support of the Kingdom’s vital infrastructure. We welcome this opportunity to help facilitate AIIB’s expansion into the region with its first financing deal in Saudi Arabia. The project aligns with our shared priority of building resilient infrastructure that can adapt to climate change and drive sustainable development.”