Riyadh evaluates bids for Saudi Landbridge

29 May 2012

Five firms submit bids for project management deal for $7bn rail project

The Saudi Railway Company (SAR) is evaluating bids from five firms for the contract to provide project management services for the estimated $7bn Landbridge rail project.

SAR has received bids from all five of the prequalified firms for the project management contract. The project management firms had been prequalified by SAR after submitting expressions of interest (EoI) in February.

The five firms that submitted bids are:

The Saudi Landbridge is a 950-kilometre-long passenger and cargo railway, which will link Jeddah on the Red Sea coast and the ports of Dammam and Jubail on the Gulf coast, through Riyadh. About 70 kilometres of the railway will have to be tunnels in order to get through the mountains in the central part of the kingdom. The Landbridge railway will be able to transport 8 million tonnes of containers each year when complete.

The Saudi Landbridge project was first launched in 2005, but has faced a number of delays due to issues over financing. It was initially planned to be developed as a 50-year build, operate and transfer (BOT) scheme financed through debt. In August 2009, the Saudi government decided to fund the scheme on its own after private banks proved unwilling to finance the project.

In October 2011, the rail project was approved by Saudi Arabia’s Council of Ministers. The project is now expected to be financed by the Public Investment Fund (PIF), which is part of the kingdom’s Finance Ministry. SAR is fully owned by the PIF and was established in 2006 to build, manage and operate the North-South railway project.

The Saudi Landbridge is one of a number of major rail projects that the kingdom is currently moving forward with. The local Arriyadh Development Authority (ADA) recently invited contractors to prequalify for the main construction package on the planned $7-8bn Riyadh light-rail metro project before the end of May.

The metro scheme is expected to be tendered as a single design-and-build package, which will include the supply of rolling stock. The metro project is part of Riyadh’s Public Transport Project (PTP) plan that was approved by the Council of Ministers on 23 April. The plan has been prepared by the high authority for the development of Riyadh.

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