Kuwait’s Al-Nasriyah al-Kuwaitiah expects to appoint before end of the year a Chinese contractor for the planned $500m airport and cargo terminal at Diwaniya governorate in central Iraq.

The package comprises the first phase of a $1.35bn project to build and operate a new airport and city in Iraq. The 45-year concession was awarded to the Kuwaiti contracting firm in early 2015.

Construction work is scheduled to start in early 2017, according to Naser Mohammed Al-Naser, consultant and deputy general manager of Al-Nasriyah al-Kuwaitah.

The company signed a $65m contract with Dubai-headquartered Eyles AMG for the airport’s design and consultancy package earlier this year.

The construction period is expected to take 26 months, which means the new passenger and cargo terminal, along with a new runway, is to be completed by mid-2019.

The project company expects to appoint contractors for the airport operations and maintenance package, baggage-handling systems, technology and security systems, among other packages, between 2017 and 2018.

All contracts will be directly negotiated, according to Al-Naser.

The airport will have a capacity to handle up to five million passengers a year, which is similar to the capacity of the existing terminal at the Al-Maktoum International, Dubai’s second airport.

Al-Naser said they are discussing potential contracts with Dubai’s Mohebi Logistics, Shell and an unnamed American-Canadian logistics company to operate the cargo terminal. The airport’s cargo capacity will be finalised once the discussions with the three interested companies  are completed.

“We are building an airport primarily for cargo, although the passenger terminal is also an important part of the project,” says Al-Naser.

He explained that al the small existing airports in Basra, Najaf, Baghdad and Suleimaniya cater primarily to passengers with limited capacity to accommodate cargo airlines. The Diwaniya airport aims to address this gap.

The proximity to Basra, which is home to Iraq’s largest oil fields, is a major motivation behind the project.

Al-Nasriyah is chaired by Sheikha Eman Nasser al-Nasser al-Sabah, a member of Kuwait’s ruling family.

Al-Naser tells MEED that while a Chinese contractor is expected to be awarded the contract to build the airport, there remains opportunities for both Iraqi and Kuwaiti companies for the supply of construction materials such as steel, as well as for the other sub-packages.

Phase two of the project, which includes constructing a small aerotropoplis that would feature hotels, residences and retail outlets, will commence once the construction of the airport and warehouse are completed.

Al-Naser says the Diwaniya governorate in Iraq presents a promising opportunity and said they expect to start recovering their investment starting on the fourth year of the airport’s operation. The executive added that the Iraqi government has committed to building the relevant infrastructure such as roads, water and sewerage that the airport requires.

It is understood that the Diwaniya governorate has been largely inoculated from the decades of conflicts and terrorism that have plagued the country. “The people there have sufficient sources of livelihood so they are least accommodating of extremist ideologies,” explains Al-Naser. “There has not been any known outbreak of violence in this part of Iraq in over 100 years.”

Apart from serving as a central location for air cargo, Diwaniya is also a popular destination for religious tourism.