Under the agreement, Bechtel will prepare a detailed economic feasibility study and marketing studies for the Al-Zabirah scheme. The project aims to produce 3.5 million tonnes a year (t/y) of bauxite ore, which will be refined to 1.4 million t/y of alumina and delivered to an aluminium smelter on the Gulf coast with capacity of more than 600,000 t/y. Bechtel beat off competition from Kaiser Hatch and Canada’s SNC Lavalinto take the award.

Once the 12-month study is completed, Maaden is also expected to invite expressions of interest for the technical advisory mandate. In October, ANZ Investment Bankand Riyad Bankwere awarded the financial advisory mandate for the project, with financial close expected in the second half of 2004.

A decision has still to be made by the Council of Ministers on how to proceed with the $1,500 million minerals railway, planned to link the phosphate mining project at Al-Jalamid and the bauxite scheme in the north with downstream facilities near Dammam.

The railway scheme was originally planned to be integrated into the phosphate mining project, which is being developed by Maaden and Saudi Oger. However, industry sources say that the railway and the mining project will probably be handled separately. The Saudi Railways Organisation is also already moving ahead with a separate east-west railroad link, which will connect with the 1,200-kilometre minerals railroad (MEED 18:10:02).