The timeframe and other details of NFC's investment remain to be worked out, a company official in Beijing has said.
Capacity of the privately owned complex will be doubled "as soon as practically possible", a statement said.
Largest Chinese investment
The complex, in Jizan Economic City in the south of Saudi Arabia, would be developed by a consortium led by the Saudi-based Western Way for Industrial Development (WWIDC).
Other investors are Malaysian power and engineering firm MMC and Saudi construction company, the Bin Ladin Group.
WWIDC would provide for power and water supply for the complex, the statement said, adding that the cost of the thermal plant would bring the total project cost to over $5bn.
Bauxite for the plant would be imported, primarily from the Mediterranean, it said.
The investment is among the largest ever made by China in the Middle East, where cheap energy and ample cash from a long oil boom is fuelling investment in industrial projects, including smelters.