The statement did not say which company has been awarded the contract to build the project -- called Shoaiba II -- but industry sources said South Korea's Daelim Industrial has won the deal.

The combined-cycle plant will have a power capacity of 1,238 megawatt (MW), SEC said in a statement.

Saudi Electricity has an $80-billion investment plan to increase its power generation capacity by 30,000 MW by 2018 to meet power demand which is growing at around 8 percent annually.

The plant, which will be in operation in almost 3 years, will help SEC meet rising power demand from the western region, SEC added.

Copyright Reuters, 2011