Business leaders estimate IPWG's decision to choose the North East as its global base could be worth hundreds of millions of pounds to the region's economy.
IPWG has developed new technology which increases the efficiency of the waste-burning process.
IPWG chief executive Peter Toscano said: "The technology we offer is very innovative, environmentally friendly and sustainable in the long term.
Simon Goon, head of business development and international relations at One NorthEast, said: "One NorthEast, through the New and Renewable Energy Centre, has been in discussions with IPWG for a number of months.
After receiving an environmental license from the Kingdom of Saudi Arabia's Presidency of Metrology and Environment (PME) in July 2006, the company formed IPWG Saudi Limited and filed papers of incorporation with the Saudi Arabian General Investment Authority (SAGIA).
"Our being granted the environmental license in July by the Kingdom of Saudi Arabia was a major milestone for the company," said Peter Toscano, IPWG chairman and CEO.
will manufacture its highly efficient Addpower units, which convert the burning waste into electricity at a rate of up to 30% higher than traditional processes.
"We are pleased with the rapid progress being made towards establishing our first waste-to-energy facilities in Saudi Arabia," said Peter Toscano, CEO of IPWG. "The Kingdom of Saudi Arabia's economy is one of the world's fastest-growing.
"IPWG's waste-to-energy technology, with its purified drinking water by-product, is, we believe, the perfect solution to the Kingdom's waste disposal, drinking water and electricity needs," Toscano said.