$60bn: The estimated value of Qatar’s planned 2022 World Cup infrastructure programme
480km: Total length of major road projects planned in Qatar from 2011-14
The recent award of a QR491m ($135m) contract to the US’ KBR to provide project management services for 29 major road projects is a sign that Qatar is prioritising the development of its road infrastructure.
With a population predicted to more than double by 2030, from about 1.6 million today, there is an urgent need to expand the country’s road networks. The Gulf state has pledged to spend about $20bn on building new roads over the next five years to improve access and ease congestion around the peninsula. The investment programme was given renewed impetus at the end of 2010, when Qatar won the bid to host the football World Cup in 2022. The event will draw hundreds of visitors to the tiny island state.
Qatar’s poor record on road schemes
The road projects planned for the next five years should provide some much-needed work for the region’s construction sector, but Qatar has a poor track record of implementing road schemes. In recent years, projects that have gone ahead have suffered numerous delays and contractual disputes.
With a $60bn-plus infrastructure programme due to be implemented for the World Cup, it is important that Doha is able to tender and complete its road projects on schedule. Access ways are an early requirement in any construction project.
In 2011, Qatar’s Public Works Authority (Ashghal) plans to tender 13 major road projects totalling 344 kilometres in length. In 2012-14, the works authority plans to build 136km of new roads.
Ashghal’s decision in February to appoint KBR as programme manager for 29 road schemes has been well received by those in the region’s construction industry.
“[Ashghal is] determining programmatically how to put the work out,” says Jeffrey Squires, president, US-based Parsons. “This represents a level of sophistication I think is important – and a good sign for Qatar’s ability to make things happen. We think there’s lots of opportunity on the road side.”
Most of the projects KBR will oversee will be the remaining packages of the Doha Expressway. The QR15bn Doha Expressway is a key project for Qatar’s road sector, and will connect the north of Doha with the south, and the east with the west. Work on the project began in 2006, but there are still plenty of contracts to be tendered in the next few years.
[Ashghal is deciding] … how to put the work out. This … [is] a good sign for Qatar’s ability to make things happen
Jeffrey Squires, Parsons
“For the Doha Expressway, a programme manager has been appointed, but there will be a number of separate packages [to be awarded],” says Squires. “In addition to the construction contracts, they will all require owner’s representatives and supervision. So there is a lot of work in that area.”
Ashghal has already made a new contract award for the Doha Expressway scheme in 2011. In January, a joint venture of Athens-based Consolidated Contractors Company and the local Teyseer Contracting Company were given a QR850m contract to build package 12 of the Doha Expressway, the F-ring road. The F-ring road work will be approximately 8km in length and will extend from the intersections of Abu Hamur and Al-Muntazah streets to the New Doha International airport.
Expressway packages in Qatar
Doha also recently invited contractors to bid for package six of the expressway project. The work involves upgrading the existing East Industrial road into six lanes as part of the new Doha Expressway. The 3.5km-long scheme will upgrade the existing road from the industrial roundabout to the junction of Al-Muntazah street. Ashghal has set an 11 April submission deadline for bids.
Qatar’s road sector will offer considerable … work for the region’s construction industry over the next five years
The 15km-long package 11 of the Doha Expressway project is expected to be tendered by the end of 2011. Ashghal is also planning to issue tender documents for the 107km New Orbital Highway in the next 12 months. This will be Qatar’s longest road and it will run from Ras Laffan in the north to Mesaieed in the south. It is designed to be used by trucks transporting freight between the ports.
Ashghal is currently finalising the conceptual and detailed design for the project, before it is tendered ahead of launching the tender.
The works authority also plans to award the contract to build the estimated QR1bn road network around the 2.7 million-square-metre Barwa City real-estate project in the coming months. Bids for the 22km of dual internal roads were submitted by contractors in August 2010.
In addition to KBR’s appointment to provide project management services for the Doha Expressway and other major projects, Ashghal plans to appoint a project management consultant for local and minor road schemes.
Qatar project opportunities
“There will be plenty of design and construction work on offer for local connecting routes,” said Saad al-Misnad, adviser to the president’s office, Ashghal, at the MEED 2011 Qatar Projects conference, held in February.
The range of road projects to be tendered in the coming years will provide opportunities for both local and large international contractors. For Qatar to successfully implement the huge number of projects planned, it will require the assistance of foreign companies, but Doha is also aware it must support local businesses. As a result, it is encouraging local firms to form joint partnerships with international companies to tender for large road projects.
At the conference, Al-Misnad outlined how Ashghal hopes to attract the experience and expertise of international contractors, while enabling local firms to develop their capabilities.
For road projects with a total value of upto QR100m, the tenders will be open to only local contractors. For contracts worth QR100m-200m, local companies can bid individually, if they can prove sufficient technical and financial capabilities. Joint ventures with international companies can also submit bids, provided the local contractor’s share is not less than 51 per cent.
For major projects worth more than QR200m, international contractors can enter the tender process on their own. But to ensure that local industry is supported, international contractors must utilise a minimum of 30 per cent locally sourced labour or materials on the scheme.
“It seems like a sensible way to procure the projects. It means that everybody will have an opportunity to win work,” says one local contractor in Doha.
In the past, road projects in Qatar have suffered from delays due to protracted tender processes and contractual disputes. The estimated QR2.5bn Lusail Expressway is an example of a road scheme that has suffered numerous delays at the tendering stage.
The road will be about 12km long and will run from Doha city to Lusail and then on to The Pearl real-estate development. It will have about 16 lanes, some of which will reach upto two or three levels. The expressway will include three major interchanges, slip roads, underpasses and bicycle lanes. Construction work is expected to take 36 months to complete.
Tenders for the expressway project were initially due to go out in August 2010, but contractors had only received documents at the end of February. The largest proposed stadium for the 2022 World Cup is planned to be built at Lusail and it is vital that infrastructure work is carried out within the scheduled timeline, so that contractors have suitable access to build the stadiums and their associated facilities.
Avoiding contractual disputes in Qatar
In addition to delays caused by an inefficient tender process, major road projects have also been stalled by contractual disputes. Towards the end of 2009, Ashghal replaced Germany’s Bilfinger & Berger on the first two packages of the Doha Expressway project due to a financial disagreement.
The contractor was awarded the QR1bn contract in 2005 in a joint venture with the UAE’s Al-Hamed Development & Construction.
For Doha’s ambitious road programme to proceed to plan, it is important that similar disputes are avoided in the future. The $20bn programme of investment is a key component of the infrastructure required to stage the 2022 World Cup event, but the appointment of a programme manager shows that Doha is keen to avoid mistakes of the past.
Qatar’s road sector will offer considerable volumes of work for the region’s construction industry over the next five years. The procurement policies set out by Ashghal should ensure that both local and international contractors have the opportunity to benefit.