Road spending booms as Gulf governments capitalise on lower construction costs
GCC governments have been using the drop in construction costs prompted by the economic crisis to press ahead with infrastructure schemes. In particular, investment has been ploughed into road construction. At present, there are $38.6bn-worth of road projects planned or under way in the GCC, according to regional projects tracker MEED Projects.
Kuwait is expected to be one of the most active markets for road projects in the next couple of years
The largest market is the UAE, with some $17bn of road projects planned or underway – 44 per cent of the regional total. The majority of this is accounted for by the $12bn Emirates Roads Masterplan that Dubai’s Roads & Transport Authority (RTA) is developing. Under the scheme, the RTA will increase the number of lanes crossing Dubai Creek to 100 by 2020 and also build several pedestrian bridges and crossings at Dubai metro stations.
Surface transport in the GCC
Abu Dhabi’s Department of Transport is also planning several road upgrades as part of its $68bn Surface Transport Masterplan, in addition to road improvements in Al-Ain and the Western region.
One of the most significant road projects in the UAE is the $2.7bn upgrade of the Mafraq-Ghweifat highway. The project is being carried out on a public-private partnership (PPP) basis – the first of its kind in the region. However, the scheme has been delayed. The evaluation of technical bids was due for completion in April and a preferred bidder scheduled to be named in June. The aim now is to select the preferred bidder by early August.
The smallest market for road projects is Bahrain, which has just 2.1 per cent of the schemes in the region. Nonetheless, Manama is planning to execute $403m of road projects in 2010, a budget previously unprecedented in the country’s history.
One of the first projects on the agenda is the BD98m ($260m) North Manama Causeway – one of Bahrain’s largest transportation projects involving the construction of a 2.4-kilometre causeway on reclaimed land. The roads budget for 2010 also includes the BD22m three-level interchange at Mina Salman Junction. If the $4bn Qatar-Bahrain Causeway was going ahead, the Bahrain government would also be footing 50 per cent of the construction bill.
Active road building projects in the GCC
Kuwait is expected to be one of the most active markets for road projects in the next couple of years, with $6.6bn of schemes in the pipeline. One major project about to move from drawing board to site is the $1bn Jahra Road upgrade.
The Public Works Ministry is seeking to upgrade the 7.2km road, which is located to the west of Kuwait City, and establish road maintenance and utility services on Jahra and Jamal Abdul-Nasser roads. The KD264m ($925m) project award to Kuwait Arab Contractors Company with Egypt’s Arab Contractors was approved by the Central Tenders Committee in January and construction on site is scheduled to start in July.
Other recent awards include a $98m contract to Kuwait’s Combined Group for a new junction on Fahaheel Road and bids are currently being assessed for new intersections on the sixth and seventh ring roads. The Public Works Ministry awarded a KD39.4m contract to the local Combined Group Contracting Company to build intersections on the sixth ring-road serving the Jahra residential area, which is located about 30km northwest of Kuwait City.
The next major bid invitation is expected to be for the 67km eighth ring road, which will give another route to vehicles crossing Kuwait City. The $200m project involves 10 new bridges and three-lane carriageways.
Qatar accounts for some 15 per cent of the total road projects in the GCC, worth a combined $6bn. A major project in the pipeline is the Doha Expressway, an ambitious road development linking the north and south of the country through the capital. It is estimated that the 13-phase project will cost more than QR8bn to execute.
The scheme is part of Qatar’s plans to invest $20bn on new roads and related drainage and infrastructure in the next five years. The investment in the country’s transport infrastructure is being carried out to address congestion in Doha. The plans are also in line with the Qatar National Masterplan that projects the country’s population will reach 2.5 million in the coming years, from the current level of 1.3 million.
Infrastructure development in the GCC
Oman is also investing heavily in improving its roads network. Infrastructure development is crucial for the country as it tries to develop sectors such as tourism and industry.
In the 2010 budget, the government allocated about OR1.7bn ($4.4bn) towards the road sector, an increase of OR724m on the amount allocated in 2009.
One of the largest projects underway is the 240km Al-Batinah coastal road project. The estimated OR274m scheme will see the construction of a four-lane carriageway from Naseem Garden to Khatmat Malaha in Wilyat Shinas. Phase 1 is already underway and is expected to be completed in 2012. Phase 2 has yet to be tendered. Several other projects are also underway to upgrade and dualise many of the sultanate’s roads. In March, the local Oman Company for Building & Contracting won a OR19.5m contract to build the second phase of the Salalah bypass in the Dhofar governorate.
In May, Oman’s Transport & Communication Ministry awarded three contracts totalling OR64.1m for construction works on the Nizwa to Thumrait road in the Al-Dhahirah region. The contracts are part of a broader scheme to convert the road into a dual carriageway. In June, the ministry awarded a OR22.9m contract to upgrade the road between Zurub and Buraimi to the joint venture of Italy’s Federici Stirling and Lebanon’s Batco.
Saudi Arabia is the second smallest market for road projects, with just $2.9bn-worth planned or underway. The schemes include the redevelopment of King Abdullah Street in Riyadh and the expansion of several highways and road schemes in Jeddah and Riyadh.
Jeddah in particular has earmarked $1.3bn for the construction of roads, bridges and tunnels. But Saudi Arabia’s spending on roads and infrastructure is likely to increase due to the sheer number of projects and real estate developments planned in the kingdom, so it could be the market to watch in future.
MEED Quality Awards for Projects 2011: Road Project of the Year
Roads are an essential part of the GCC’s transport infrastructure, aiding the movement of people and goods around the region
Causeways, tunnels and bridges can be as iconic as the biggest real estate and commercial projects. The MEED Quality Award for Road Project of the Year will recognise completed projects that can demonstrate quality throughout the programme management, integrated thinking with other means of travel and a sustainable approach to the environment.
- Projects that can be nominated for these categories include:
- Road projects including widening schemes and extensions;
- All bridges, tunnels and causeway projects
Those submitting project nominations should use the official online entry form to supply information on the five factors in the delivery of the project:
- Economic and social feasibility
- Architecture and design
- Construction procurement and project/programme management
- Environmental impact and sustainable development
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