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First phase of energy industrial city to complete by 2021: Saudi Aramco

It will cover 12 sq km area of the total planned project that expands over 50 sq km

Reuters  |  Khobar (Saudi Arabia) 

Saudi Aramco

State oil firm said the first phase of a new in will be completed in 2021.

Last week, the Saudi government said it approved Saudi Aramco's plans to set up two new companies that will develop and operate the new as the kingdom seeks to expand its industrial base.

The city, which will be developed over 50 square kilometres (km) of land allocated for energy-related industries, will complete its first phase that covers almost 12 sq km by that date, said in a statement late on Saturday.

The city will be located between Dammam and Ahsa, at the heart of energy operations, the statement said. An earlier report said the city will be close to Abqaiq, which is in the middle of Dammam and Ahsa.

Ghawar, the world's largest onshore is near al-Ahsa.

The Saudi Industrial Property Authority (Modon) which develops industrial cities in has started to lay out plans and programmes with to develop and operate the city, the statement added.

The top oil exporter is trying to lower dependence on oil and build up new industries to speed up job creation for a rapidly rising young population.

It plans to list in stock markets up to 5 per cent of its shares in Aramco, which will help it invest in other sectors to generate more revenue streams.

The city is expected to add 22.5 billion riyals ($6 billion) to gross domestic product (GDP) each year and create thousands of jobs, Khalid al-Falih, the Saudi minister of energy and chairman of was quoted as saying.

Falih did not give a date for when the project will contribute to GDP.

It will support Aramco's operations, will cut costs of products and services, and meet the needs of Saudi Aramco's operations, the statement said.

It will also provide drilling, exploration and production services and pipe manufacturing.

First Published: Sun, July 16 2017. 15:36 IST