The consortium led by Turkey’s TAV Airports Holding Company has won the contract for the $1.5bn expansion of Medina International airport on a public-private partnership (PPP) basis.

Local Saudi Oger and local Al-Rajhi Holding Group are also in the winning consortium.

Saudi Arabia’s General Authority for Civil Aviation (Gaca) received four bids for the deal on 5 June, having initially prequalified eight groups (MEED 5:6:11).

When the tender process first began, Gaca received 49 requests for prequalification for the deal.

The development of Medina airport is significant as it is the first airport to be carried using a PPP model in the Gulf.

TAV, Saudi Oger and Al-Rajhi will design, finance, build and operate Medina airport for a concession period of 25 years.

Medina airport timeline
March 2010 Companies invited to prequalify
April 2010 Prequalification deadline
April 2010 Gaca meets with interested parties
June 2010 Gaca prequalifies eight consortiums
August 2010 Prequalified groups invited to bid
June 2011 Bid deadline 
August 2011 Contract awarded
Gaca=General Authority of Civil Aviation. Source: MEED

Phase one of the expansion will take place from 2011 to 2014. It will involve building a new terminal, extending the existing runway and building an apron and taxiway. This will increase capacity at the airport to eight million passengers a year from the current four million.

Due to the annual hajj period and umrah, traffic in Medina is much more constant than seen in other airports in the kingdom.

Pilgrims to Saudi Arabia
2006 1.6 million
2007 1.7 million
2008 1.7 million
2009 1.6 million
2010 1.8 million
2035f 14 million (expected)
f=Forecast. Source: Royal Embassy of Saudi Arabia

Phase two of the expansion will take place between 2021 and 2024, and will involve the possible construction of a new runway. Phase two will be executed according to demand and will further increase capacity to 14 million passengers a year.

The execution of phase two could drive up the cost of the expansion to $2.4bn.

The International Finance Corporation (IFC), part of the Washington-headquartered World Bank Group, is acting a lead adviser on the project.