Kuwait Authority for Private Partnerships (Kapp) has yet to issue the request for proposals (RFPs) for the transaction advisory contract for the Kuwait National Rail Road scheme.

Without an RFP, consultants may not be appointed before the end of 2018, the initial target set by Kuwait authorities.

MEED reported in March that the civil works package of the project’s first phase, which will extend from the Saudi border to central Kuwait City, “could be awarded” to the selected consortium comprising developers, contractors and financiers as early as next year, while the signalling, track and systems package will be tendered later.

In April, a local media report said relevant authorities in the country “have almost finished removing the last obstacle facing Kuwait’s leg of the GCC railway project”.

According to the report, the state property sector of Kuwait’s Finance Ministry has “finished preparing the compensation amounts to be paid to the owners of ranches and farms located on the railway route”.

MEED understands the compensation packages require cabinet approval before being finalised.

Mohammad Saud al-Hadbah, a board member of Kuwait’s Public Authority for Roads & Land Transport (Part), said the first phase of the railway, which will have a passenger and cargo component, has an estimated budget of KD900m ($2.9bn) and is expected to become operational by 2023.

Consistent with the earlier plan and based on the structure supported by the country’s procurement law, a project company will be formed by the selected consortium that will own between 26 and 44 per cent of the company, with the remaining shares to be floated in an initial public offering (IPO).

The Kuwait government or public sector companies can then purchase shares equivalent to a minimum of 6 per cent and a maximum of 24 per cent of the project company, Al-Hadbah said.

The first phase of the railway will extend 265 kilometres from the Saudi border to Kuwait City all the way to the under-construction Boubiyan Port. It is broken down into five segments.

A planned second phase will extend the railway by 43km to the Iraqi border.