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Inside Saudi Arabia’s water market

Water projects across Saudi Arabia – desalination, wastewater, transmission and storage – are booming. The flow of investment is only likely to increase as barriers to entry fall and the floodgates open to newcomers from across the globe

By SWPC

Last year, just days after a consortium led by Salini Impregilo won a €770m ($850m) contract to build the Al-Bayt stadium for football’s Fifa 2022 World Cup, the Italian contractor secured another order for work in Qatar.

The award, secured by a joint venture of Salini Impregilo and the local Bin Omran Trading & Contracting, attracted far less attention than the more glamorous stadium-building deal, but it was significant. Valued at €300m, the 30-month contract to build infrastructure in the north of the country is part of the Public Works Authority’s (Ashghal’s) Local Roads and Drainage Programme. The programme, although low in profile, is one of the largest building programmes currently under way in Qatar.

With a combined value of about QR53.2bn ($14.6bn), the programme includes more than 200 road and drainage construction schemes.

Given the high number of projects to be delivered, it was decided that rather than use traditional procurement policies for each tender, a framework contract would be set up between the project owner and selected contractors.

The works have been divided into five geographical areas, which together cover the entire country.

Ashghal has appointed consultants to supervise each area. By the end of last year, some 40 contracts within the scheme, worth an estimated total of $4.2bn, had been awarded, according to regional projects tracker MEED Projects.

The entire programme is due for completion by 2020.

For upcoming work, Ashghal invited firms to prequalify for the group 2 segment of the LRDP in October last year.

The road sections within the segment are estimated to have a budget ranging from $55m to $250m.

Companies sought should be either local, or an international firm working in joint venture with a local business.

Contractors will be prequalified for a duration of three to five years, according to the prequalification document released by Ashghal.