Kuwait moves mainline and metro rail prequalification dates

16 March 2016

Partnership Projects Authority now aiming to start prequalification by second quarter

The Kuwait Authority for Partnership Projects (KAPP) has moved the start of the prequalification process for its national railroad and metro rapid transit projects from the first to the second quarter of this year.

“We are still finalising the review of the feasibility studies for both schemes. We will definitely move forward [with the prequalification] in the second quarter,” Fatima al-Kandari, project manager for the rail and metro projects at KAPP, tells MEED. “It would be wrong the make any assumption that the project will not be moving forward.”

The feasibility study for the national rail was completed in 2011 by a team led by the US’ Booz and Company. A review of the feasibility study has been awarded in August 2015 to UK’s EY, who is acting as the lead transaction adviser, along with Trowers & Hamlins, legal adviser, and Arup, technical adviser. EY also leads the team that is reviewing the metro feasibility study.

Al-Kandari, however, declined to comment on whether the state’s planned 574-kilometre mainline rail line, which will connect with the planned GCC regional rail network at the border with Saudi Arabia, will be tendered ahead of the more expensive metro project.

A source familiar with the project told MEED in December 2015 that the mainline rail could be tendered ahead of the metro scheme due to the timeline of the GCC rail, whose original completion date is set for 2018. That target date now appears less likely as none of the domestic mainline rail schemes that would comprise the 2,135km regional rail line have been awarded yet.

Besides the regional railway timeline, Kuwait’s mainline rail is also estimated to cost significantly less, at $2bn, compared with the metro rapid transit scheme, whose budget is expected to reach roughly $18.5bn. The 200km metro network is envisaged to serve Kuwait City with 90 stations.

Both schemes have sought interested companies before. In 2010, the Kuwait government announced the intention to build these projects on public-private partnership (PPP) basis and begun prequalifying interested companies. The PPP plan was dropped in 2013, when the procurement of the projects were moved from the Partnerships Technical Bureau (PTB) to the Communications Ministry, the agency responsible for Kuwait’s rail projects, and the preferred procurement model consequently moved away from PPP to being fully state-funded.

The adoption of a new PPP law in Kuwait in early 2015 facilitated the revival of the rail and metro schemes. Both have now been transferred to the KAPP, which replaced the PTB as Kuwait’s PPP procurement authority.

In December 2015, in a move that shows concrete intention to move forward with the rail scheme, the Kuwaiti government asked the Public Authority of Agriculture Affairs and Fish Resources (PAAAFR) to take necessary measures towards delivering the required plots of land for the GCC Railway project to the Communications Ministry. The cabinet is understood to have asked the PAAAFR to “remove all obstacles to carry out this vital project as soon as possible.”

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