Across the GCC, a new era of rail has started. Taking their lead from the golden days of European railways, the six GCC states are planning ambitious rail systems to carry both passengers and freight.
Their plans extend beyond national borders to encompass a regional network worth more than $20bn and totalling 2,200 kilometres of track. Once complete, the line will run from Kuwait to Muscat in Oman, changing the face of transport and logistics in the region by the end of 2017. The potential rewards are immense, furthering the vision of a regional community at one with itself. But the challenges are significant, requiring all the diplomatic and political skills at the region’s disposal.
Key challenges to building a GCC rail network
Building a railway in the region’s hostile desert climate is just one of the problems developers will face. Financing is a second issue, even in a region accustomed to delivering megaprojects that others would baulk at.
Beyond that lies a bigger challenge – that of ensuring that the six national rail systems work together. If a seamless regional transport is to be achieved, the six networks must be built to the same standards and specifications. It was the task which the Europeans faced, both within national borders and across the continent, and it proved a testing goal, requiring technical expertise, diplomatic finesse and political will.
If a seamless regional network is to be achieved, national rail systems must be built to the same standards
The body responsible for overcoming these hurdles in the region is the GCC Secretariat, which is close to commissioning a study on the formation of a new GCC Rail Authority, which will manage standardisation and coordination of the regional rail network.
“The secretariat expects to secure the approval from the six GCC member states in November,” says Ramiz al-Assar, senior adviser to the GCC Secretary General and senior transport specialist at the Washington-headquartered World Bank.
A breakdown in relations between Manama and Doha is blamed for the stalled $4bn Qatar-Bahrain Causeway
“It is currently assessing technical and financial proposals. The study will look into the organisation of the GCC Rail Authority and its mandate, how it will operate and how it will implement the rail project.”
Some key technical aspects of the project have already been resolved. It will be single-track for dual use as both passenger and freight rail network. It will have diesel traction.
By the end of December, the secretariat expects all six states to submit their proposals for detailed engineering design and regulatory plans.
The secretariat will then award the rail project contract to a consortium of engineering consultants, who will join all six rail lines into one seamless network. It is set to appoint consultants to carry out two major studies.
One is for an integrated transport study, which will analyse how the railway will link with other modes of transport in each of the states. The second is for a Geographic Information Systems (GIS) Integrated Transport Study for the GCC.
The pan-regional body aims to resolve by 2011 all the politically sensitive aspects of the project, which require consensus among members such as customs and immigration.
The GCC states also have secure financing for the project. To date, none of the six countries has a definite funding plan in place to meet the cost of integrating their rail lines, which includes land appropriation.
The link to Yemen is another point of contention within the region. A feasibility study that will see the rail link extend from Muscat to Salalah and on to Yemen is due to be discussed in October.
If the study is approved, this will be the second phase of the project and will be mainly a freight line, used to transport cargo between the major ports of Salalah and Duqm to Yemen.
Just how efficiently the newly-formed GCC Rail Authority will iron out these problems remain to be seen.
The economic benefits of the GCC railway are extensive. It will increase mobility of cargo and passengers, facilitate trade and generate jobs in the region.
A significant challenge is that the six national rail schemes are at varying levels of progress. Saudi Arabia’s rail plans are by far the most advanced, but plans to build a bridge linking Qatar and Bahrain have stalled.
A breakdown in relations between Manama and Doha is blamed for the stalled $4bn Qatar-Bahrain Causeway. If the causeway is not completed in time for the GCC railway opening date, passengers travelling from Qatar to Bahrain will have to travel through Saudi Arabia to Bahrain via the King Fahd Causeway. Bahrain is undertaking a transport study for a railway, light rail transit system and metro.
Kuwait is currently set to announce the consultant on its $10bn railway project.
The successful adviser will assist the Partnerships Technical Bureau (PTB) in planning the technical aspects of the railway, developing feasibility studies and establishing project financing.
Oman is currently prequalifying firms for the detailed design brief contract and the project management deal. Awards are due to be made imminently. The railway project will be constructed in three phases. The first phase will comprise a 230km line that runs from Sohar to Muscat. The second phase will involve building a 560km line running from Muscat to Duqm. Oman may then decide to extend the line to Salalah. Oman’s rail plans include a metro system in Muscat. France’s Systra and the local National Engineering Office carried out the feasibility study for the project
On the other side of the Gulf, Qatar’s progress lags behind that of its neighbours. Real estate company, Qatari Diar formed a railway development company with Germany’s Deutsche Bahn two years ago. A source involved in the project says the new company may well be operating by the end of the year. However, other observers say that relations between the Qatari government and Deutsche Bahn are decidedly frosty at present, a possible reason for the apparent lack of progress. It is also rumoured the railway is not as ambitious as the $25bn price tag would suggest. Most of the budget will be given over to the metro.
The 800km first phase of the North-South minerals line in Saudi Arabia is due to be up and running by the end of 2010.
Operated by India’s Rites Company, the railway will be used to transport phosphate and bauxite from Jelamaid in the northern region to processors in Ras al-Zour located near the industrial port city of Jubail.
The railway will eventually be 1,486km and will form part of the GCC railway. It will also link up with the delayed 950km Saudi Landbridge project that is designed to create a link between Jeddah on the Red Sea coast, and the ports of Damman and Jubail on the Gulf coast, passing through the kingdom’s capital Riyadh.
With a price tag of around $7bn, Saudi Railways Organisation, the government body which passed operations over to Saudi Arabian Railway, was scheduled to award construction contracts on the project in the first quarter of 2010. No award is yet on the horizon. The project has been beset with problems from its inception. The government originally proposed the scheme as a 50-year build-operate-transfer (BOT) deal financed through debt.
In August 2009, Riyadh decided to fund the scheme on its own after private banks proved unwilling to finance the project. The project is now being retendered on an engineering, procurement and construction (EPC) basis.
If and when the project goes ahead, it is forecast to be able to transport eight million tonnes of containers from the ports to the Gulf and beyond.
These two freight lines will also connect with the $7bn Haramain high-speed railway between Mecca and Medina.
Across the border in the UAE, Union Railway is busy working on its tender process. There are two tenders out now relating to the civil works and another two packages relating to systems and rolling stock. The detailed prequalification packages were due to be issued in mid-September.
Union Railway is also expected to make an announcement about the financial advisory contract soon. It is rumoured that the financing will be done in a number of different packages, rather than one large package.
The first phase of the railway involves building a 265km line to connect the Shah gas field in the south of the emirate with oil and gas processing facilities at Habshan in the southwest and will be used to transport 10,000 tonnes a day (t/d) of granulated sulphur. A later phase will go on to connect Habshan with distribution facilities at the port of Ruwais in the Western Region and will be used to transport 20,000 t/d of sulphur.
Richard Bowker, chief executive officer of Union Railway has made it clear that the railway is for the Emiratis and therefore should be run by local people.
To this end, Union Railway is in talks with the Higher College of Technology and Khalifa University about setting up courses specifically related to developing, engineering and operating a railway.
Union Railway has also recently completed the alignment of the Dubai section of the railway. Plans for a high-speed rail link between Abu Dhabi and Dubai are under discussion.