Exclusive interview - George Antonopoulos, SETE
On Saudi, transparency and the future of the Kingdom's infrastructure
Owned by the international Latsis Group, SETE Energy has maintained a presence in Saudi Arabia for almost four decades now, and has been involved in some significant projects in that time. In its capacity as an EPC contractor and developer, the company has been associated with major refinery complexes, industrial infrastructure, process water treatment plants and civil and marine works projects.
“We have a good, traceable track record in the Kingdom,” says the company’s CEO George Antonopoulos. “We have always delivered on our promises, and we believe in Saudi Arabia – we have always demonstrated our belief in the country by investing.”
“We have a lot of respect for the Kingdom of Saudi Arabia, which has some clear visions,” he says. “We are very happy to be a part of the development by putting our money back in to where we have earned it.”
Today, SETE’s operations cover the full water spectrum from desalination to the treatment of industrial waste water, in addition to the power and steam
generation sectors of its portfolio.
“Power is not a new thing for SETE,” explains Antonopoulos. “We have done power plants and we’ve done steam generation plants, but now we see that there is a big need for new projects to combine power and water, and sometimes power, steam and water.
We want to be a market force in this sector, and we can attract the right international partnerships.” With companies the world over clamouring to do business in the Kingdom, what is the environment like for EPC contractors?
“Being an international company we have the means to compare with other countries, and I can assure you that the rules and regulations and the transparency we see in Saudi Arabia, we do not see in many other parts of the developed world,” he says.
“The rules of the game are very clear in Saudi Arabia. The routes are clear and fair and transparency is to the highest degree. Simply put, there are two main steps – if you fulfill the technical requirements, then you go to step two – commercial. If you are also commercially the most acceptable, then you meet the requirements and the job is yours. It’s as simple as that.”
Lately, the company has taken the decision to concentrate on the general power and water business and, based in Saudi Arabia, the outlook is positive. “There are good opportunities ahead of us, both on the EPC front as well as investment opportunities,” says Antonopoulos.
“There are also further privatisation plans in Saudi Arabia, and we have not yet expanded into any other GCC countries because we have always been busy in Saudi Arabia – it’s a locomotive economy.”
However, this is all about to change as SETE looks to new markets in the Middle East.
“Recently, a decision has been taken at Latsis Group level that SETE Energy will expand into Qatar, and we are going to go into a broader spectrum of activities, not just power and water,” Antonopoulos reveals.
“We will be considering broader opportunities, including industrial development projects and infrastructure projects, and we will have established a company there before the end of the year.”
Back in Saudi, he is confident that the water business will continue to expand in order to meet demands from blossoming industry, and that a steady increase in planned desalination facilities isn’t necessarily evidence of a nation ignoring water conservation issues in favour of pushing up capacity.
“The next five to 10 years will see an increase in capacity. There will be an increase in water need not only from demographic requirement – Saudi Arabia’s population is growing at one of the highest rates in the world – but also for the development of industry,” Antonopoulos says. “For industrial development water is mandatory and I see in the next five to 10 years more plants being built.”
However, he is keen to stress that this is not all new plants to cater for a nation using water at an unsustainable rate. “Because of the peculiarities of Saudi Arabia – where the water doesn’t come from nature, it’s produced – the plants you construct today will need replacing in 20 or 30 years’ time.”
“Of course, there will be a time when you won’t see any more plants being offered, but I would say that there will always be a need to repair and replace, and to put additional capacity in. I see this trend continuing.”
Saudi Arabia’s wastewater industry has also become one of the most carefully regulated in the Middle East, which has increased the cost of facilities but also pushed the quality of treated water to a new level.
“Saudi Arabia has adopted the most stringent regulations for wastewater treatment, and this applies to both domestic waste as well as industrial waste. We’re heavily involved in the industrial waste sector, and we have seen that they don’t spare any effort – I believe that Saudi Arabia is a pioneer in applying stringent regulations.”
However, the application of more rigorous regulations means that the cost of infrastructure construction has increased, in some cases by a considerable margin. Antonopoulos estimates that the difference between the old set of regulations and the revised ones would increase the cost of a plant by between 40 and 50 per cent to achieve the same capacity.
“The treatment reaches a point with industrial waste, when if you spend a certain amount of money you have a good quality output. But to improve this quality, the cost grows exponentially; with one piece of equipment you can bring the output to a certain quality – say 80 or 90 per cent – but for the remaining 10 or 20 per cent, you may have to double the level of equipment. That’s where the money goes to get to this level of cleanliness for the end product.”
The Kingdom’s interest in high-quality water treatment is linked to water reuse; as
Antonopoulos points out, if you’re going to reuse it the quality needs to be good and similarly, if it’s to be disposed of in the sea, it needs to be of a high quality too.
“There is still plenty of room in the water reuse business in Saudi Arabia, both for industrial liquid waste and domestic water,” says Antonopoulos. “Broadly there is also room for improvement and for SETE, the wastewater business – in particular the industrial liquid waste business – is very much of interest.
Also of interest is the zero liquid discharge process, which is directly related to the reuse; eventually you throw nothing away, you’re achieving 100 per cent reuse – it’s a great area.”
The company has built up quite some expertise in the sector, having been heavily involved with the two largest industrial wastewater projects in the Kingdom, in
Jubail and Yanbu.
Thanks to consistently increasing demand for water, the desalination business in Saudi Arabia is also booming.
“We have seen recently that the Seawater Reverse Osmosis (SWRO) method is picking up, although there is still a lot of money on research and development to be spent on this particular process,” Antonopoulos says. “Multiple Effect Distillation (MED) is also picking up, but because of the economics I believe SWRO will pick up more.”
With increased use of desalination to quench the thirst of an expanding nation, comes the question of water conservation. Is Saudi Arabia doing enough to conserve water?
“It is a concern,” Antonopoulos admits. “We have two issues here. First, you have the inevitable need for power and water, and the alternative is to expand or cultivate other technologies because all thermal plants require some kind of fuel – whether it’s fuel oil, heavy fuel or natural gas.
“Also, we would be better off exporting it rather than burning it for domestic needs – this makes sense, but the only alternative is to consider other technologies which are very specialised.”
There are already significant attempts in Saudi Arabia to expand on solar and wind power, and while he declines to be drawn too much on the subject, Antonopoulos admits that SETE will be a player in the renewables market in the not-too-distant future.
“SETE is closely monitoring developments in renewable energy, and we will be ready to participate in solar, in photovoltaic plants as well as wind power in the next five years.We’re just getting ready with the right partnerships.”
Good partnerships, according to Antonopoulos, are the key to success in Saudi Arabia. “Our strong base in Saudi Arabia and our operation as a 100 per cent Saudi company makes SETE more attractive for international players to come and work with us. We are known
internationally as a company that delivers, and we have a good, traceable track record.”
The company is shortly to embark on an expansion into the Kingdom’s power industry, too. With a history of power projects outside Saudi Arabia, and predicted power demand in the country set to skyrocket, SETE is looking to bring its expertise to home turf.
“This is why we’re concentrating on this field; because we see that in the next 10 to 15 years there is going to be a continuous increase in power capacity; the trend will be even higher than water.
For the next ten years, the Kingdom’s power needs will be more than the water needs, and we will capitalise on our presence and expertise, and enter the field. We have been doing power outside the Kingdom primarily, and now we want to apply it in Saudi Arabia, since projects are offered in a combined nature between power, water and steam.”
SETE currently has around 1,000 professionals in-Kingdom, split between the EPC and Operations Maintenance sectors, with the outsourcing of the construction side of the business having streamlined the business considerably.
“In the 1980s, we had 14,000 people on our direct payroll because we were doing a lot of construction work,” says Antonopoulos. “But things are progressing in Saudi Arabia and today there are very good local construction companies, so we’re adopting a model of operation to the market needs and requirements.”
“In terms of Saudisation, obviously we fulfill the requirements, but our aim is to increase more and more the Saudi presence in our organisation. We are offering training courses, we’re encouraging young graduate Saudis; it’s not an easy task in Saudi Arabia, but we’re definitely encouraging the local population to come and take over all positions, from technical skilled workforce to top management.”
While some Middle Eastern countries can appear reluctant to embrace new technology,
Antonopoulos says Saudi Arabia is sometimes misjudged.
“Saudi Arabia is a pioneer in technology. The Saudis would always consider and encourage new technologies, and the proof is the largest technological university in the Middle East – the King Abdulla University for Science and Technology.
Saudi Arabia builds things systematically, at the right level, and sometimes there is a wrong impression concerning the Saudis; that they are too slow. They do things with method and system, which is why they can take more time, but things are methodically done.”
“I’m not trying to paint a bright picture, but I think I have the right to speak – I’ve been in Saudi Arabia for 29 years, so I’ve seen the changes and I can compare – the Kingdom has been a steady environment. Technologically there have been billions of dollars invested; a bit more cautiously, yes, but it pays to be more cautious with more system and methodology in place.”
However, Antonopolous is pragmatic when it comes to improvment in the the way business is done in Saudi Arabia.
“There is room for improvement. As I’ve said, the legislation and transparency are there which is very important for international organisations such as ours, and in Saudi Arabia they have been continuously improved. But obviously wherever you do business in the world there is room for improvement, and in Saudi we would like to see an improvement of the working visa situation, for technical and professional visits.
Although it has been improved in the last five years, perhaps we will reach the point of getting visas at the airport, which would further ease the business environment.
“In Saudi Arabia they apply improvements in a very conservative manner, and I think if you compare this conservatism with the rest of the GCC, in general business, investments and expansions, it has paid off. It’s proved that Saudi’s model is a good one.”
So, with a planned move into the Kingdom’s power industry, extensions to operations in Qatar and a keen eye on the renewables market, where does Antonopolous see his company in the next five to ten years?
“We aim to maintain our good name, because to sustain and grow your business, you have to sustain and maintain what you have,” he says. “I think one of the reasons we fit in well to the Saudi environment is that SETE, and the Latsis Group, are conservative. We have stayed here for 40 years, and we plan to stay here for many more, so I see SETE’s priority is making sure we keep delivering on our work in hand.”
“At the same time of course, we want to further enhance our activities – we want to be one of the key players in the fields of industrial water, water desalination and on the power front, too. This is where I want to see SETE – we want to be a significant force in these fields within the next five years.”
Sete in Saudi:
PROJECT: King Abdulaziz International Airport Seawater Desalination Plant
CLIENT: General Authority for Civil Aviation
PROJECT: Expansion of Industrial Wastewater Treatment Plant
LOCATION: Jubail International City, Jubail
CLIENT: Power and Water Utility Company for Jubail and Yanbu
CAPACITY: 55,000m3/day (95,000 post-expansion)
TECH: Conventional Activated Sludge and Tertiary Treatment
PROJECT: Supply and installation of brackish water desalination RO units
LOCATION: Yanbu Industrial City, Yanbu
CLIENT: Power and Water Company for Jubail and Yanbu
PROJECT: Seawater Reverse Osmosis Potable Water Treatment Plant
LOCATION: King Abdullah University for Science and Technology, Thuwwal
CLIENT: Saudi Aramco/KAUST
PROJECT: Rabigh BOOT Desalination Plant
LOCATION: Rabigh Refinery, Rabigh
Meet George Antonopoulos
Antonopoulos has been with the Latsis Group, which owns SETE, for some 30 years and has a background in engineering. Prior to his involvement with the Latsis group he worked in Japan, and worked his way up through SETE’s heirarchy in what he terms a “fundamentally correct” way, working as an engineer, construction manager, an operations manager and finally, to CEO.
“Since focusing on the desalination and industrial wastewater treatment sector, SETE Energy has gone from strength to strength,” he says in his CEO’s message. “It is now recognised as one of the leading in-Kingdom EPC, O&M contractors as
well as BOO / BOOT developers for general water projects.”