Talks continue for Dubai tram financing

06 September 2011

Consortium received partial funds in April

The contracting consortium building Dubai’s $1.1bn Al-Sufouh tram network is still in talks over the financing of the project with a deal expected at the end of September.

In April, the consortium received partial funds to continue with the project after it was put on hold in June 2010 (MEED 12:4:11).

The tram project was put on hold in 2010 due to irregular payments from the Roads & Transport Authority (RTA).

“The RTA and DoF [Department of Finance] are still actively looking at possible options and nothing is arranged yet, but this seems to be on the right track,” says a source close to the project.

The consortium, led by France’s Alstom and the local/Belgian Belhasa Six Construct, resumed some of the work in January. This included the viaduct on Sheikh Zayed Road, the mock-up station, the tramway at Jumeirah Beach Residence and some utilities work at Dubai Marina.

In September 2010, the RTA reached a deal to repay the developers of the Dubai metro and settle contractor claims.

Under the contract, the RTA will pay the Dubai Rail Link Consortium AED29.6bn ($8bn). The RTA will pay AED3.77bn in monthly instalments of AED169m between May 2010 and September 2011. The remaining AED5.82bn will be repaid over the next seven years.

The metro consortium comprises Japanese companies Mitsubishi Corporation, Mitsubishi Heavy Industries, Obayashi Corporation and Kajima Corporation; and Turkey’s Yapi Merkezi.

The 52-kilometre Red line of the metro opened on 9 September 2009. The 23km Green line is scheduled to open exactly two years later on 9 September 2011. Dubai Ruler Sheikh Mohammed bin Rashid al-Maktoum will open the line. It will have 18 stations in total. The RTA expects to operate 14 trains in peak hours and 10 trains at off-peak times. The total number of trains in operation on both lines will reach 50 during peak times.

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