Maaden has been waiting on a decision by the subcommittee of the Supreme Economic Council regarding the degree of government participation in the 1,200-kilometre industrial railroad, which will connect Al-Zabirah to the Gulf coast. The Saudi Railways Organisation is already moving ahead with its own east-west rail link. Industry sources say Maaden and Saudi Oger are now likely to develop the railway under their own aegis, although the government is likely to retain a strategic stake in the project. Saudi Oger is working with Maaden on the phosphate project at Al-Jalamid, which will be the northernmost terminus of the railroad.

‘The government will almost certainly still take a stake in the railway,’ says a source close to the project. ‘There are some 1,000 container trucks a day coming by road from Hail and the Jordanian border to Riyadh. They can much more easily be brought by train.’

Maaden is also expected to announce the award of the feasibility study contract for the $3,200 million Al-Zabirah bauxite mining project, which will include construction of an alumina refinery and associated smelter. Three international groups are understood to have been shortlisted for the study, which is due to be completed by the end of 2003. The pre-feasibility study was prepared last year by Australia’s Kaiser Hatchand France’s Pechiney.

Al-Zabirah is expected to produce nearly 3.5 million tonnes a year (t/y) of bauxite ore, which will be refined to 1.4 million t/y of alumina and delivered to a smelter on the Gulf coast with capacity of more than 600,000 t/y for export. The scope of the project was significantly expanded during the pre-feasibility phase.

ANZ Investment Bankand Riyad Bankwere awarded the financial advisory mandate in October – financial close for the project is expected in the second half of 2004 (MEED 18:10:02).