The private company formed to take over and develop utilities in the industrial cities of Jubail and Yanbu plans to invest $1,300 million-2,100 million in its first five years of operation, according to Prince Abdallah Bin Saud Bin Thunayan, acting chairman of the Royal Commission for Jubail & Yanbu. He was speaking on 10 October, the day after the cabinet approved the articles of association of the new company, which has been named the Utilities Company (Uco). The original decision to go ahead with the formation of the company was taken in mid-1999 (MEED 23:7:99).
Uco has been capitalised at SR 2,500 million ($670 million). Four equal stakes are held by the Royal Commission, the Private Investment Fund (PIF), Saudi Aramco and Saudi Basic Industries Corporation (Sabic).
The company will take over the existing facilities in the two cities on a leasehold basis. It will operate and maintain these facilities, as well as undertaking new projects. Services will be provided to non-industrial users at tariffs set by the government, while services to industries will be priced at a tariff based on the principle of 'commercial cost', according to a statement issued on 10 October. The statement says the company's board will decide on the tariffs during the first three years. Subsequently, an independent body will be set up to perform this role, following a public offering of shares in Uco, the statement said.