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Saudi Arabia to spearhead green development vision with forum during COP28

Alongside the UN’s COP28 summit, the Kingdom will host the third edition of the Saudi Green Initiative Forum on Dec. 4 to highlight its dedication to build a greener future at a time of multibillion dollar giga-projects. (Philip Ekladyous/AN
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Updated 30 November 2023
Rebecca Anne Proctor
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Saudi Arabia to spearhead green development vision with forum during COP28

  • Saudi Green Initiative Forum to gather influential figures, climate experts and thought leaders to present their insights and recommendations for tackling climate change
Updated 30 November 2023
Rebecca Anne Proctor

RIYADH: Saudi Arabia is committing itself to a sustainable and green future through a variety of initiatives, with one of the most high-profile set to be held at the upcoming climate conference in Dubai.

Alongside the UN’s COP28 summit, the Kingdom will host the third edition of the Saudi Green Initiative Forum on Dec. 4 to highlight its dedication to build a greener future at a time of multibillion dollar giga-projects.

The event will gather influential figures, climate experts and thought leaders to present their insights and recommendations for tackling climate change.

It will also offer a platform to showcase the ambitions and achievements thus far of the SGI, launched in 2021 by Crown Prince Mohammed bin Salman.

 

 

Established under the Vision 2030 initiative, SGI is an ambitious national plan focused on combating climate change, protecting the environment for future generations and improving the quality of life in the Kingdom.

It unites all the efforts towards Saudi Arabia’s mission of achieving net zero emissions by 2050 through the creation of a circular carbon economy. The Kingdom has also pledged to reduce carbon emissions by 278 million tons annually by 2030.

To achieve such aims, the Kingdom has committed itself to “greening,” which involves the development of an integrated system of conservation and afforestation strategies for the country’s various natural landscapes.

According to the website of King Abdullah University of Science and Technology, greening is set to “increase Saudi Arabia’s reliance on clean energy, offset carbon emissions, and protect the environment. It aims to improve quality of life and protect future generations.”

By 2030 Saudi Arabia plans to plant 600 million trees, restore 3.8 million hectares of land and champion biodiversity conservation as part of its 10-billion-tree initiative.

Additionally, as part of this greening initiative, SGI aims to develop an integrated system of conservation and afforestation strategies targeted at the Kingdom's diverse natural landscapes.

The task of overseeing the realization of the greening project has been entrusted to the National Center for Vegetation Cover Development and Combating Desertification.

“The NCVC is dedicated to expanding vegetation cover, combating desertification, conserving natural resources and biodiversity, safeguarding plant genetic resources, and pioneering the innovative solutions that address our environmental challenges,” Khaled bin Abdullah Al-Abdulkader, the organization’s CEO, told Arab News.

“We collaborate with all sectors including public, private, non-profit and the community to deliver sustainable outcomes,” he said, adding: “The NCVC has developed the strategic roadmap to guide the delivery of 10 billion trees for Saudi Arabia under the SGI. We are now moving from ambition to action, and we invite all innovators, entrepreneurs, scientists and interested parties to join us in our efforts.”

The Kingdom is the world’s second-largest major oil producer after the US. It has committed to driving the Middle East Green Initiative by seeking to unify stakeholders across the region to mitigate the impact of climate change on the region and meet global climate targets.

There are challenges, however, in achieving SGI’s ambitious targets due to Saudi Arabia’s arid landscape. It lacks rivers, lakes and regular rainfall and relies on dozens of facilities to transform water from the Gulf and Red Sea for its residents and the environment.

Saudi Arabia is also the largest country in the world without running surface water and has one of the highest rates of water consumption on the planet.

READ: For our coverage of the Saudi Green Initiative, click here

It has long been crucial and of national importance for the Kingdom to find new sources of potable water to support its growing population, and now it has to reach the targets set out in SGI.

“We will not use any desalination water for plantation,” Ahmad Al-Anazi, who leads the implementation of the National Environment Strategy and an advisor at the Ministry of Environment, Water, and Agriculture, told Arab News. “We will concentrate on using what they call renewable water for plantations.

The greening initiative, states Alanazi, offers the opportunity to retrieve more drinking water.

“We are responsible for enhancing the vegetation capital of the country overall,” he said, adding: “We are employing specialists to study all possible ways to plant trees and increase vegetation.”

“It’s not only a matter of planting trees,” Alanazi explained, adding: “It is also about how we then sustain the trees for the long term. This is a crucial aspect of sustainability, and we are conducting multiple studies on how to do this in this environment.”

Alanazi told Arab News that numerous experts are helping them achieve the Middle East Green Initiative to plant an additional 40 billion trees across the region.

According to SGI targets, the 10 billion trees earmarked for Saudi Arabia would help to rehabilitate 40 million hectares of land, improve air quality, restore vital ecological functions and reduce sandstorms.

Alanazi said two phases are involved in achieving the goals of the masterplan, with the first set to take place from 2024 to 2040.

“In this phase most of our focus will be on planting in nature, or what we call a natural based solution,” he said, adding: “This phase aims to plant 400 million trees in 3.8 hectares. The second phase is more comprehensive and aggressive and includes all domains and will be set forth from 2030.”

Further wins for Saudi Arabia’s green initiative were announced in early November when a consortium of clean energy leaders – Masdar, EDF Renewables and Nesma Company – announced the signing of a Power Purchase Agreement with the Saudi Power Procurement Company to develop the 1,100 megawatts Al Henakiyah solar power plant.

When operational, the $1 billion project is expected to power more than 190 thousand homes per year and displace more than 1.8 million tons of carbon dioxide annually.

“As Nesma’s flagship renewables business, Nesma Renewable Energy is intrinsic to our commitment to proactively support the clean energy and sustainability goals of Saudi Vision 2030,” Faisal Al-Turki, president of Nesma Group, said in a statement.

He added: “The Al Henakiyah Solar Project is a resounding endorsement of our position at the forefront of the renewables industry in Saudi Arabia.

“As an industry, we are on an ambitious journey together, and one that will ultimately establish Saudi Arabia as a true global leader in renewable energy generation. This project represents a significant milestone on our way to achieving this.”

The upcoming SGI forum during COP28 offers an opportunity to further address global climate issues while focusing on the Kingdom’s own aims, hurdles and achievements towards its climate goals.

Topics: COP28 Saudi Arabia climate change Saudi Green Initiative

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Closing Bell: Saudi main index closes in green, reaches 11,949 points

Updated 10 sec ago
NOUR EL-SHAERI   
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Closing Bell: Saudi main index closes in green, reaches 11,949 points

  • MSCI Tadawul Index increased by 15.52 points, or 1.05%, to close at 1,500.07
  • Parallel market Nomu lost 285.18 points, or 0.91%, to close at 30,953.11 points
Updated 10 sec ago
NOUR EL-SHAERI   

RIYADH: Saudi Arabia’s Tadawul All Share Index increased by 0.84 percent or 99.42 points to reach 11,948.79 points on Monday. 

The total trading turnover of the benchmark index was SR4.9 billion ($1.3 billion), as 111 of the listed stocks advanced, while 117 retreated. 

The MSCI Tadawul Index also increased by 15.52 points, or 1.05 percent, to close at 1,500.07. 

The Kingdom’s parallel market Nomu dropped, losing 285.18 points, or 0.91 percent, to close at 30,953.11 points. This comes as 32 of the listed stocks advanced while 51 retreated. 

The main index’s top performer, Zamil Industrial Investment Co., saw a 4.31 percent increase in its share price to close at SR33.90. 

Other top performers included Saudi Reinsurance Co., which saw a 4.20 percent increase to reach SR47.15, while the Mediterranean and Gulf Insurance and Reinsurance Co.’s share price rose by 4.16 percent to SR23.52. 

Red Sea International Co. also recorded a positive trajectory, with share prices rising 3.89 percent to reach SR56.10. 

Kingdom Holding Co. also witnessed positive gains, with 3.75 percent reaching SR9.13. 

National Co. for Learning and Education was TASI’s worst performer, with the firm’s share price dropping by 3.94 percent to SR204.60. 

Aldrees Petroleum and Transport Services Co. followed with a 3.84 percent drop to SR120.20. Riyadh Cement Co. also saw a notable drop of 3.61 percent to settle at SR32.05. 

Walaa Cooperative Insurance Co. and MBC Group Co. were among the top five poorest performers, with shares declining by 3.52 percent to settle at SR17.56 and by 3.17 percent to sit at SR54.90, respectively. 

On the announcement’s front, Almujtama Alraida Medical Co. disclosed that Khabeer Althanyia Investment Co. — a major shareholder — has announced its intention to distribute and deposit its 630,673 shares in Almujtama Alraida, representing 6.64 percent of the company’s capital, into the investment portfolios of its current partners. 

The move, according to a filing on Tadawul, will result in changes to the list of the company’s major shareholders. 

Almujtama Alraida Medical Co.’s share price dropped 2.91 percent on Monday to settle at SR30.05. 

Najran Cement Co. announced that its shareholders approved the transfer of SR163.62 million from its statutory reserve, as reported in its financial statements for the year ending Dec. 31, 2023, to its retained earnings balance of SR138.15 million. 

The decision was made during the company’s extraordinary general meeting held on Dec. 22, according to a statement on Tadawul. 

Shareholders also approved the repurchase of up to 17 million shares to be held as treasury shares, citing the board’s view that the company’s stock is trading below its fair value. 

The share buyback will be financed through the firm’s resources, including cash balances or credit facilities, with the board authorized to complete the process within 12 months of the meeting date. 

The repurchased shares can be retained for a maximum of 10 years, after which the company will comply with applicable laws and regulations, the statement said. 

Najran Cement Co.’s share price saw a 1.22 percent dip on Monday to close at SR8.92.

Topics: Saudi Arabia Tadawul All Share Index (TASI) Closing Bell MSCI Tadawul Index NOMU Tadawul TASI Saudi stock market Saudi Stock Exchange (Tadawul)

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Saudi Arabia inaugurates Yanbu Grain Terminal to boost food security, trade

Updated 23 December 2024
Nadin Hassan
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Saudi Arabia inaugurates Yanbu Grain Terminal to boost food security, trade

Updated 23 December 2024
Nadin Hassan

RIYADH: Saudi Arabia has inaugurated the Yanbu Grain Handling Terminal, underscoring the Kingdom’s efforts to strengthen public-private partnerships, enhance agricultural trade, and bolster food security across the region.

The event was attended by Abdulrahman Al-Fadli, minister of environment, water and agriculture, and by various government and private sector officials, according to the Saudi Press Agency.

The Yanbu Grain Handling Terminal will serve both public and private sector importers, and boasts a storage capacity of 156,000 tonnes, including 12 silos with a combined capacity of 96,000 tonnes.

Food security has risen up the agenda in recent years, as countries in the Gulf contend with the impacts of climate change, the consequences of trade-disrupting conflicts such as the Ukraine-Russia war, and interruptions to supply routes through the Red Sea.

In September 2022, in response to these challenges, the Kingdom collaborated with regional partners to launch a food security action plan with an initial funding of $10 billion.

The Yanbu Grain Handling Terminal will be operated by the National Grains Co., a joint venture between the national shipping carrier Bahri and the Saudi Agricultural and Livestock Investment Co.

It features a 650-meter conveyor belt and a discharge rate of 800 tonnes per hour directly from ships, with an annual handling capacity exceeding 3 million tonnes of grain.

According to Bahr’s statement to the Saudi Stock Exchange, the inauguration delay was caused by the inclusion of additional requirements to enhance future operational efficiency, along with the construction of extra infrastructure to accommodate potential future expansions.

The company said that because of this the total project cost rose by 7 percent from the initially allocated SR412.5 million ($109.7 million), though the increase is not deemed significant.

The Yanbu Grain Handling Terminal aims to become a world-class logistics hub, connecting three continents and supporting the Kingdom’s vision for a resilient and efficient agricultural supply chain.

Established in 2020 as a strategic partnership between SALIC and Bahri, the National Grain Co. aims to fulfill the Kingdom’s future feed grain requirements while enhancing its global competitiveness.

It is committed to advancing grain trade, handling, and storage through the Yanbu terminal, strengthening supply chains and ensuring price stability across Saudi Arabia.

SALIC, a Public Investment Fund-owned company, was formed in 2011 to secure food supply for Saudi Arabia through mass production and investment.

When the project was announced in 2020, Al-Fadli, who is also the chairman of SALIC’s board of directors, said: “The project aims to enhance the velocity of the main grain influx to Saudi Arabia and is considered the first regional center for grains in the commercial port of Yanbu.”

 

He added that SALIC relies on the geographical location of the Kingdom and the port infrastructure to enhance food distribution in the region by linking the Kingdom to global grain sources, especially countries where SALIC is investing.

 

A grain delivery service to customers within the Kingdom has been introduced as part of the project, ensuring greater proximity to clients, enhanced customer experience, and improved profitability margins.

Topics: food security Yanbu Grain Terminal grain

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UAE’s ADNOC boosts drilling capabilities with 2 new jack-up rigs

Updated 23 December 2024
MOHAMMED AL-KINANI
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UAE’s ADNOC boosts drilling capabilities with 2 new jack-up rigs

  • ADNOC Drilling will expand its fleet to 142 platforms
  • UAE possesses the sixth-largest crude oil reserves globally
Updated 23 December 2024
MOHAMMED AL-KINANI

JEDDAH: The Abu Dhabi National Oil Co. has received two new jack-up rigs, reinforcing its position as one of the largest drillship fleet owners globally.

ADNOC Drilling will launch the new rigs by the first quarter of next year, expanding its fleet to 142 platforms. This marks a strong year for the company, showcasing its performance and strategy, according to UAE state news agency WAM.

For over 50 years, ADNOC Drilling has been the exclusive provider of drilling and rig-related services to ADNOC Group under agreed contractual terms, supporting the firm’s upstream operations in exploring and developing oil and gas resources in the UAE.

With most of the Gulf country’s crude oil and gas reserves located in Abu Dhabi, ADNOC oversees the majority of nationwide exploration, appraisal, development, and production activities, which are managed by ADNOC, either independently or in partnership with third parties.

In its analysis of the company’s performance, JPMorgan, a global financial services firm, said: “Since its initial public offering, ADNOC Drilling has proven to be a high-quality, defensive business, consistently meeting and surpassing guidance and expectations. The exceptional performance also reflects positive progress with ADNOC Drilling’s two joint ventures.”

The UAE possesses the sixth-largest crude oil reserves globally, with approximately 107 billion stock tank barrels of proven oil reserves. Since its inception in 1972, ADNOC Drilling has played a crucial role in enabling ADNOC to unlock the country’s oil and gas resources efficiently and reliably, contributing to the nation’s energy sector.

This year, Enersol, a joint venture between Alpha Dhabi Holding and ADNOC Drilling, acquired four oilfield services technology companies, while Turnwell, another business partnership between ADNOC, SLB, and Patterson-UTI, set a record for initial well delivery time, accelerating the development of the UAE’s unconventional energy reserves.

Following its second upward guidance revision this year alongside its third-quarter results, ADNOC Drilling is on track to deliver its best-ever performance in Q4. ADNOC Drilling anticipates at least mid-single-digit expansion as it scales operations, according to WAM.

ADNOC forecasts a rise in drilling activity in the coming years, driven by its commitment to increasing crude oil production capacity by 25 percent, reaching five million barrels per day by 2027.

As the company looks to expand beyond the UAE and explore opportunities in the region, it foresees a growing need to expand its rig fleet to support its strategic growth plans.

The energy giant believes that expanding its rig fleet will enhance its current capabilities in rig hire, drilling, completion services, and associated operations and enable the company to offer unconventional drilling and biogenic well services. This expansion is expected to contribute to increased revenue and profitability.

Topics: ADNOC Abu Dhabi National Oil Co. (ADNOC) oil and gas UAE ADNOC Drilling

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Terminal 4 at Cairo International Airport to boost Egypt’s aviation and tourism sectors

Updated 9 min 36 sec ago
 MIGUEL HADCHITY
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Terminal 4 at Cairo International Airport to boost Egypt’s aviation and tourism sectors

  • Project is expected to bolster the country’s tourism goals and improve traveler experiences
  • Egypt’s aviation sector also improved 36 spots to 27th in the 2024 edition of the Air Transport Infrastructure Index
Updated 9 min 36 sec ago
 MIGUEL HADCHITY

RIYADH: Egypt is advancing its aviation sector with the ongoing development of Terminal 4 at Cairo International Airport, set to accommodate 30 million passengers annually.

According to a statement from the Cabinet, the “New Republic Air Gateway” project is expected to bolster the country’s tourism goals, improve traveler experiences, and position Egypt as an international aviation hub.

This year, the government announced plans to involve the private sector in airport management, including a global tender for Cairo International.

Egypt’s aviation sector also improved 36 spots to 27th in the 2024 edition of the Air Transport Infrastructure Index, aligning with Vision 2030’s focus on sustainable development, innovation, and global competitiveness.

Prime Minister Mostafa Madbouly, during a meeting at the New Administrative Capital, reviewed progress on the project alongside Minister of Civil Aviation Sameh El-Hefny. The session focused on the terminal’s specifications, implementation strategy, and potential to reshape the African nation’s aviation and tourism landscapes.

“Airport development works come within the framework of presidential directives to upgrade the Egyptian airport system, raise its capacity and improve the level of services provided to passengers,” he said.

At the meeting, Madbouly emphasized the importance of creating world-class facilities to accommodate rising traveler numbers. 

El-Hefny outlined the project’s phased execution, with completion expected within four to five years. He also revealed that negotiations are underway with international firms specializing in airport construction and management to ensure world-class execution. 

The minister emphasized the cutting-edge features of the new terminal, including its ability to initially handle 30 million passengers annually, with expansion potential to 40 million. 

In September 2023, Cairo Airport Co. partnered with Pangiam, a trade and travel technology company, and signed two agreements to develop the new terminal. These deals, focused on enhancing the airport’s operations with advanced technology, include a feasibility study to incorporate emerging technologies and deliver a seamless travel experience.

The terminal will feature a state-of-the-art runway equipped with advanced navigation and lighting technologies that meet international standards. 

Once operational, Terminal 4 is expected to elevate Cairo International Airport’s global status, making it a hub for regional and international travel. 

Topics: Cairo International Airport Egypt

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Saudi banks report 24% profit growth amid strong non-interest income 

Updated 23 December 2024
Dayan Abou Tine 
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Saudi banks report 24% profit growth amid strong non-interest income 

Updated 23 December 2024
Dayan Abou Tine 

RIYADH: Saudi banks’ aggregate profit reached SR7.7 billion ($2.05 billion) in October, marking a 23.67 percent year-on-year increase, newly released data has revealed. 

According to the Saudi Central Bank, also known as SAMA, these figures represent profits before zakat and taxes. 

Cumulatively, from the beginning of the year to the end of October, banks recorded a total profit of SR73.28 billion, compared to SR64.47 billion during the same period last year. 

The increase in banks’ profits is primarily attributed to a combination of favorable factors that highlight the sector’s strength and ability to adapt.  

The third quarter of 2024 marked a significant turning point, with non-interest income playing a pivotal role.

According to a Fitch Ratings report published in November, strong gains on securities and trading contributed SR1.4 billion to non-interest income, offsetting higher financing impairment charges and helping push combined quarterly profits to SR20 billion.  

This growth followed SAMA’s decision to implement a 50-basis-point interest rate cut in September, which mirrored the US Federal Reserve’s shift toward a more accommodative monetary policy. 

The rising interest rate environment that characterized much of the Gulf region in recent years had previously bolstered bank returns on loans, as higher borrowing costs translated into greater income from financing activities. 

However, this dynamic also increased funding costs, particularly for savings accounts and external liabilities.   

Many Saudi banks navigated these challenges by diversifying their funding sources, tapping into external markets, and issuing a record $13 billion in debt in the first eight months of 2024 to meet growing foreign-currency financing demands, particularly for giga-projects.  

Despite these efforts, deposit growth in the third quarter of 2024 lagged behind earlier quarters, according to Fitch, reflecting the sector’s strategic pivot toward external funding to sustain its expansion.  

The recent shift in monetary policy by the US Federal Reserve, which influences rates in Saudi Arabia due to the riyal’s peg to the dollar, has injected new dynamics into the financial landscape. 

After a period of aggressive rate hikes to combat inflation, the Fed lowered interest rates by 50 basis points in September, followed by successive 25-basis-point cuts in November and December, signaling a focus on boosting economic growth as inflation eased to acceptable levels. 

This policy change benefited Saudi banks by improving the valuation of certain securities, as noted by Fitch, and created a more favorable environment for non-interest income growth. 

Another critical factor underpinning Saudi banks’ profitability has been their robust asset quality and prudent risk management.  

The average impaired financing ratio, according to Fitch Ratings, remained low at 1.5 percent by the end of the third quarter, with provision coverage at a healthy 116 percent.  

This stability reflects the resilience of Saudi banks in managing risks associated with their expanding financing books, which grew by 3.6 percent during the quarter, led by strong performances from banks like Aljazira, Saudi Awwal Bank, and Saudi Investment Bank. 

The sector’s healthy operating environment is supported by the Kingdom’s broader economic stability and strategic investments under Vision 2030, which continue to drive demand for corporate financing. 

While external liabilities and a negative net foreign asset position present challenges, Saudi banks remain well-capitalized, with average Common Equity Tier 1 ratios of 15.6 percent, and are positioned to maintain strong asset quality metrics as they navigate a shifting global monetary landscape. 

The combination of rising non-interest income, strategic funding diversification, and favorable monetary policy shifts underscores the resilience of Saudi Arabia’s banking sector, making it a key player in the region’s economic transformation. 

As SAMA continues to align with global trends, Saudi banks are poised to further strengthen their profitability while maintaining a balanced approach to growth and risk management. 

Topics: Saudi banks Saudi Central Bank (SAMA)

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