Russians lead bidding on North-South rail

09 November 2007

Russian Railways has submitted the lowest bid for the contract to build the final section of Saudi Arabia's North-South minerals railway.

With a bid understood to be about $3,000 million, the state-owned Russian group heads a field of five bidders hoping to construct CTW 400, a 480-kilometre-long stretch from Al-Zabirah junction to Riyadh's King Khaled International Airport. It is the fourth section of the railway.

Other bidders are Saudi Binladin Group, Saudi Oger, along with two subsidiaries of the state-owned China Railway Construction Corporation: the 15th and 18th China Railway Construction Bureau Corporations. The Public Investment Fund (PIF), which is managing the project, had expected 10 bids from the 12 pre-qualified companies (MEED 26:10:07).

'They are all very strong bids and the prices are all very close,' says a source close to PIF. 'We would rather have had five strong bids than 10 average. We are now evaluating the technical detail of the submissions, but assuming they fully meet the requirements of the project then it comes down to price.'

Details of the bids and an announcement of the winner are expected to be made public by the end of November. The first three construction packages on the 2,400-kilometre railway were awarded earlier this year (MEED 6:4:07).

The PIF is also finalising bid documents for three large ancillary service contracts for the North-South project. Tenders will be issued in January for companies seeking to provide signalling and telecoms, rolling stock, and operations and maintenance services.

The other three main construction packages on the railway were signed earlier this year (MEED 6:4:07).

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