Transport infrastructure is finally getting the investment it deserves in Saudi Arabia. Urbanisation and an anticipated boom in high-rise construction are making the upgrading of inner-city roads and public transport systems of paramount importance for the government.
Industrial growth means railways, airports and cross-country highways need to be improved, and a boom in air passengers is driving the need for greater capacity in the aviation sector.
“The infrastructure needs upgrading,” says Ahmed Anees, business development manager of local construction giant Saudi Binladin Group. “A lot is old – for example, the railways and airports. But privatisation and investors are playing a major part in this.”
The investment has led to an increase in the number of projects coming to the market. “There has been a noticeable increase [in the number of projects], especially in rail schemes and tenders, and also airports – domestic airports particularly,” says Jean Akari, deputy project manager of local contractor Al-Mabani.
In the aviation sector, several key contracts have recently been awarded. Prince Abdulaziz airport in Jeddah is undergoing a major expansion, at the same time as a new international airport is being built just 4 kilometres away.
In May, Al-Mabani was awarded a contract from the General Authority of Civil Aviation (Gaca) for the renovation and repair of seven domestic airports in the kingdom. The SR300m ($80m) contract covers runway
renovation and maintenance at Najran, Al-Taif, Buraydah, Hail, Al-Wajeh, Ar Ar and Qourayat. The work is expected to take up to three years.
Al-Mabani has secured a further SR300m contract for the construction of terminal buildings at Najran airport. Mobilisation on both projects started recently, with the overall project due in 24 months.
Al-Mabani is also working on a SR1bn contract to upgrade and renovate the airfield of King Abdulaziz International Airport at Jeddah, and is carrying out works at Tabuk. It is also due to complete work at Yanbu airport.
Away from the airports, progress has also been made on a several key rail projects. Four prequalified groups have submitted bids for the contract to build the $5bn Saudi Landbridge railway linking the kingdom’s major Red Sea and Gulf ports in Jeddah and Dammam.
The freight link will be operated by a private company on a 30-year, build-operate-transfer basis, while a separate concession for the private rail operations will be awarded later.
By linking the country’s biggest deep-sea port at Jeddah to Riyadh, and ultimately the wider Gulf region, companies will be able to move goods from coast to coast within 24 hours, rather than the six days it currently takes to ship them around the Arabian Peninsula.
The local Mada, Kuwait’s Agility Logistics and Saudi Binladin head three of the groups. The fourth, the Tarabot group, includes South Korea’s Samsung Corporation and Australian rail group Pacific National. MEED revealed in March that the Tarabot group, led by the local Acwa Power, was the lead bidder for the Saudi Landbridge project with the Tracc consortium led by Saudi Binladin Group selected as reserve bidder. The local Saud Consult, the US’ Parsons Brinckerhoff International and France’s Societe Nationale des Chemins de Fer International (SNCF) are consultants. Saudi Railways Organisation (SRO) is the client.
Away from the freight-oriented Landbridge project, a $4bn monorail is being planned to link the kingdom’s holy sites in Mecca, including Mina, Muzdalifah and Arafat. It is being developed by the Municipalities & Rural Affairs Ministry. The government hopes the rail system, which is pending approval, will have capacity for up to 90,000 passengers an hour.
The project will be integrated with the $6bn, 444-kilometre Mecca-Medina high-speed rail link, which is in its final bid stage, with a contract award expected this year.
According to Samir Ashour, Riyadh-based resident manager of Lebanese consultant Khatib & Alami, which is involved in the feasibility study, it is nearing completion, with a proposal due in September.
“The challenge will be the number of passengers who will be using the system,” says Ashour. “We are studying how to manage so many people.”
The firm is also undertaking the feasibility study in partnership with Canada’s Canrail and France’s Systra for the $2.5bn GCC railway, which will carry both freight and passenger traffic and is expected to link with the Landbridge at Dammam. Construction could begin on the project in 2010, pending government approval.
Running the length of the eastern coast, the rail link will connect Kuwait in the north with Oman in the south, via Saudi Arabia, Bahrain, Qatar and the UAE. It will provide an alter-native to sea and land routes for transporting goods and cut commuting times between cities.
Two options are being considered for the network. One is a 1,984km line beginning at the Iraq-Kuwait border running parallel to the Gulf coast down to Saudi Arabia and the UAE, with a link to Qatar and Oman. The other is a 1,970km railway with a spur running into Bahrain.
Investment in such schemes is being welcomed by the industry and for many it is long overdue.
“It is too late, and will be late for the next five or six years because we are trying to catch up,” says Marwan Saadeh, resident manager at the Jeddah branch of Khatib & Alami.
Khatib & Alami is heavily involved in several transport projects in the kingdom, including the design of six road bridges in Jeddah, which are due to begin construction. The company is also bidding for a further six bridges, which are valued at SR30m each.
Another impact of trying to modernise the transport infrastructure is that it is increasingly difficult to do so in a busy, established city.
“Nothing has happened in Jeddah for the past 20 years,” says Saadeh. “Suddenly a lot of money is coming into the kingdom. There is a lot of transport work in Jeddah, but here we have the same problem [as other infrastructure work], that working within the existing buildings and properties is not easy. Also, the labour is not easy to get, and working between houses is very hard.”
While a large number of tenders are being issued for works, there are some fundamental issues that concern contractors – specifically, the inflexible approach taken by the Transport Ministry that all road projects must have a duration of 36 months, regardless of their size or scope.
Contractors complain that the 36-month rule means their resources are tied up for longer than necessary and that minor schemes that should take a matter of months are being dragged out to fulfil the tender obligations.
It is clear that the government could have acted more quickly to launch transport projects, but the fundamental difference between today and even two years ago is that they are finally being given the go-ahead.
With all mediums of transport seemingly sharing equal billing, the kingdom’s road, rail and air transport is getting the changes necessary to ensure the equally ambitious development plans being pushed forward have the infrastructure they need to succeed.