EXCLUSIVE: Discussions for Mecca Metro financing continue

20 July 2017

Evaluation of offers for the scheme completed in 2015

Negotiations are still ongoing between Mecca Mass Rail Transit Company (MMRT) and the shortlisted bidders for the four packages of the Mecca Metro scheme on the preferred financing model, despite a key government official indicating earlier this year that all unawarded rail schemes in the kingdom are to be developed as a public-private partnership (PPP).

According to sources familiar with the project, the client, MMRT, has been keeping its options open between adopting a PPP and a hybrid engineering, procurement and construction (EPC) plus finance model.

This could mean the award of contracts to the preferred bidders is not likely to happen before the end of 2017 as earlier expected.

The evaluation of technical and commercial offers for the four metro and one bus package was completed in 2015.

However, the contract awards due in late 2015 were put on hold when the government ordered a kingdom-wide review of project awards.

In February, the first phase of the city’s bus project was awarded to a consortium comprising UK-based National Express and local Hafil Transportation Company.

The contract, to be fully funded by the government, is estimated to cost SR3.1bn ($832m). It entails the procurement and operation of 500 buses over a 10–year period.

Saudi Arabia’s Public Transport Authority (PTA) recently invited companies to express interest in private sector partnerships for passenger and freight train services in the kingdom.

The main areas for which the PTA is seeking private sector participation are:

  • operation of freight and passenger services
  • management and maintenance of passenger stations
  • management and maintenance of dry ports
  • maintenance of rolling stock

The existing assets that the solicitation of interest covers are the Riyadh to Dammam lines and the North-South Railway. It could also include the operation of future projects such as the GCC rail network, the Landbridge, and other smaller sections of railway planned within the kingdom.

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