The regulatory framework for Saudi Arabia’s water sector

The primary activities in Saudi Arabia’s water sector involve desalination, transmission, distribution and wastewater treatment. There has been a notable shift from direct construction and operations by public companies to increased private sector involvement throughout the entire lifecycle of projects, primarily through public private partnerships (PPPs). This has led to the establishment of new public entities, such as the Saudi Water Authority (SWA), to regulate these sectors rather than directly manage them.

The rules and standards for all water infrastructure and services in Saudi Arabia are established by the Minister for Environment, Water, and Agriculture (MEWA) and the SWA. MEWA is primarily responsible for policy formulation and strategic direction while SWA acts as the main water regulator. The SWA was created through the transformation of the Saline Water Conversion Corporation (SWCC) and is statutorily linked to MEWA.

The Council of Ministers’ Resolution No. 652 dated 21 June 2022 (22.11.1443H) stipulated that the ownership of all public water production, transportation, and storage assets owned directly or indirectly by the SWCC would be transferred to a new company owned by the Public Investment Fund (PIF) – Water Solutions Company (WSC) and rebranded as Water Solutions and Management (WSM). To date, this transfer has not taken effect.

We have already looked at the role of some of the main government entities shaping the sector, which has been undergoing continuous and strategic restructuring in recognition of the Kingdom’s ongoing commitment to sustainable resource management and alignment with Vision 2030.

As the regulatory landscape continues to shift, investors and project developers should familiarise themselves with the principal regulatory bodies and government entities that are performing overlapping regulatory and operational functions related to desalination; reservoirs and dams; transmission and storage; distribution and wastewater, collection and treatment.

The MEWA and the SWA are the primary policy makers and regulators for all water asset classes:

• they are jointly responsible for issuing the relevant regulations and standards for the sector;
• they oversee the financial sustainability and operational coordination of the water sector through the Water Balancing Account (WBA) – a central financial mechanism that is expected to match sector costs and revenues – whose financial and operational backbone is the Saudi Water Partnership Company (SWPC) under the Ministry of Finance.

The National Centre for Environmental Compliance (NCEC), under MEWA, is the body responsible for issuing environmental permits for water facilities, enforcing their compliance, and investigating any environmental violations.

A number of other public entities, state-owned and private companies are also engaged in the sector across the following five asset classes:

Water production: desalination

Public entity owners

The ‘production’ arm of the SWA is still operating most of the facilities formerly held by the SWCC, employing a large workforce of around 5,000 people. The SWA is expected to transfer these facilities to WSM, which would operate them through purchase agreements with the Saudi Water Partnership Company (SWPC).

In June 2025, the SWA received funding from the Asian Infrastructure Development Bank for two desalination replacement projects. Separately, in July 2025, the SWA awarded engineering, procurement and construction (EPC) contracts for two desalination projects in Jubail and Yanbu.

State-owned and private company owners

The SWPC is fully owned by the Ministry of Finance and supervises private investments in a range of water projects including desalination, water treatment, water reservoir, water transmission and dams projects. Among other roles, the SWPC is the primary purchaser of water from both public and private producers.

In 2024, the SWPC procured Jubail 4&6 IWP, a 600,000 cubic meter capacity plant, and Ras Mohaisen IWP, a 300,000 cubic meter capacity plant, which are both scheduled to reach commercial operation in 2028.

Water production: reservoirs and dams

Public entity owners

The National Water Company (NWC) owned by the PIF, in coordination with SWA, operates most of the plants that carry out the water treatment of aquifers and dams.

State-owned and private company owners

This part of the sector is dominated by independent private producers, including NEOM, which has awarded the construction of three dams in Trojena. The SWPC has issued tenders for a few independent strategic water reservoir (ISWR) projects, including Juranah ISWR, which is currently under construction.

Transmission and storage

State-owned and private company owners

Water transmission occurs from water production facilities to tanks in the cities (often branded as City Gates).

The Water Transmission Company (WTCO), a government-owned entity, is expected to take over from the SWPC as the main procuring body for transmission pipeline projects from production facilities across the distribution networks.

In the absence of the SWCC’s assets transferring to WSM, we continue to see both the WTCO and the SWPC procuring transmission projects. The SWPC is currently procuring the Riyadh-Qassim IWTP, while in September 2025 the WTCO launched a tender for the Ras Mohaisen Baha Makkah and Jubail-Buraidah 2 independent water transmission system projects. Following the transfer of assets, the WTCO is expected to take on the role as both developer and procurer and is seeking competitive EPC tenders, which could allow contractors to acquire a minority interest in the development company.

Distribution

State-owned and private company owners

Distribution occurs from the water tanks to the final users, either by pipeline or truck.

The National Water Company (NWC), which is state-owned through the Public Investment Fund, is Saudi Arabia’s principal water and wastewater provider. Its portfolio includes water distribution networks and wastewater treatment facilities. Although there has been limited use to date of PPP in NWC projects, the NWC has issued some management, operation and maintenance (MOM) tenders for smaller water network projects, such as replacement of pipes.

NWC is also involved in some planning exercise in coordination with MEWA and SWA, and has procured several Regional Water Masterplan to assess the water needs across six regional clusters.

Wastewater, collection and treatment

Public entity owners

The Saudi Irrigation Organisation (SIO) is the government institution responsible for optimising the use of treated water across agricultural, industrial, and urban sectors, which includes operation and maintenance of pumping stations, pipelines for irrigation water, as well as dam management for agriculture purposes.

State-owned and private company owners

Both the NWC and the SWPC are active in the procurement of wastewater treatment projects. Generally, the NWC launches tenders for the operation and maintenance of existing facilities and issues tenders for greenfield sewage treatment plants at a smaller scale. It has also announced a plan to award contracts for 15 sewage infrastructure projects. The SWPC generally procures the construction and operation of higher value independent sewage treatment plants (ISTP).