Saudi Arabia’s first high-speed rail is expected to begin full operations in early 2018 following the ratification of an agreement between the client, the Saudi Railways Organisation, and the Al-Shoula consortium to revise the timescale of the project.

Originally set for a 2016 completion date, the Haramain High-Speed Rail (HHR) project has been hit by a series of delays and setbacks due to payment delays.

A preliminary agreement to settle the payment dispute was reached in November last year.

Based on the revised agreement, partial operations of the rail will begin in December 2017 with full opening expected in March 2018.

The local Al-Shoula Group-led consortium, which includes multiple Spanish companies, signed a $7.9bn deal for the rolling stock and systems of the 450km second phase of the HHR in 2012.

Spanish companies that are part of the Al-Shoula consortium include:

• Adif / Renfe: 12-year operation and maintenance
• OHL / Copasa / Imathia: Track construction and maintenance
• Inabensa / Cobra: electrification and electro-mechanical equipment
• Talgo: rolling stock
• Dimetronic (recently acquired by Siemens): signalling
• Indra: ancillary and control systems including intrusion detection and ticketing

Phase 2, which covers a 450km route, comprises the construction of the railway tracks, installation of signalling and telecoms systems, electrification, construction of the operational control centre, the procurement of 35 trains, and the operation and maintenance of the railway for 12 years.

In 2012, Al-Shoula secured a loan of just over SR3bn from a group of six Spanish banks to help finance phase 2 of the project, covering the supply of rolling stock and systems. The financing, which is in the form of advance and performance bonds, was partly guaranteed by the Spanish export credit agency Cesce and the Official Credit Institute of Spain.

Rolling stock supplier Talgo announced in July 2015 that the $200m deal it had signed five months earlier with SRO for the supply of six high-speed trains had been cancelled. It is understood no clear explanations were given for the cancellation at the time.