The cancellation of the $6.4bn Al-Karaana petrochemicals complex saw Qatar register a decline of 2.1 per cent. This is Qatar’s worst performance since October last year and makes it the biggest decliner on the Gulf Projects Index in the week ending on 16 January.

Project updates
  Project name Project status
Iran Kish development (phase 2 and 3) Execution
Iraq Kirkuk airport expansion On hold
Iran Tabas coal-fired power plant New project
Qatar Al-Karaana petrochemical complex Cancelled
Saudi Arabia Rabigh cement plant expansion New project
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Al-Karaana was a joint venture of UK/Dutch Shell Group and state-owned Qatar Petroleum (QP), and would have included a mixed-feed steam cracker with a capacity of 1.1 million  tonnes a year (t/y) of ethylene and 170,000 t/y of propylene.

Shell and QP announced they were scrapping the scheme on 14 January citing concerns about commercial feasibility amid lower oil prices. The termination of Al-Karaana comes after the scrapping of Al-Sejeel in September, a similar petrochemicals complex planned for Qatar that had a price tag of $7.4bn.

The cancellation of the two projects has exacerbated fears that more projects could be scrapped or put on hold as the Gulf’s oil exporters cut back on spending.

Upcoming tender deadlines
  Client Contract Submission date
UAE Dubai Electricity & Water Authority Solar innovation centre Jan-15
Qatar Qatar General Electricity & Water Corporation (Kahramaa) Ras Laffan independent water project Feb-15
UAE Nakheel Palm Gateway Mar-15
Oman Public Authority for Water & Electricity Wadi Dayqah treatment plant Mar-15
UAE Dubai Electricity & Water Authority Hassyan power plant 26-Mar
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Elsewhere in the Gulf, Saudi Arabia, the UAE, Bahrain, Iran and Iraq all saw solid growth in their project markets, helping to propel the Gulf index to a 0.7 per cent expansion, its best performance since November.

Saudi Arabia, the Gulf’s biggest project market, saw 21 new projects announced, helping it expand by 0.5 per cent as it added $6.3bn to its project market.

The UAE’s projects market rose by 0.8 per cent as it added $6.6bn to its project market. A total of 49 new projects were announced over the week, mainly comprising commercial and residential construction schemes.

Bahrain saw the biggest jump of the week, up 4.7 per cent due to the announcement of 84 new projects.

In numbers

10 New projects in Qatar

21 New projects in Saudi Arabia

49 New projects in the UAE