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The Golden Age of Arabian Rail

A raft of multi-billion-dollar metro contracts this year is turning the Middle East into a railway projects hotbed.

Until recently the Arabian Peninsula had long been a backwater for rail development.

Despite hosting the now-defunct Hejaz railway made famous by the exploits of Lawrence of Arabia, until 2009 the six states of the Gulf Cooperation Council (the GCC) – Bahrain, Kuwait, Oman, Qatar, the UAE and Saudi Arabia – between them had only operational railway, a 200 km single-track link between Riyadh and the oil hub of Dammam.

In the oil-rich region, where petrol costs are as low as $0.45 a gallon, it is no surprise that the car has been king.

“In the first seven months of this year, more than $30bn-worth of metro projects have been awarded”

However, increasing congestion, especially in cities, and a growing environmental awareness have led the GCC states to start investing billions of dollars in new rail and metro networks, in one of the world’s most ambitious new state-funded rail-build programmes.

Additional momentum was supplied by the 2009 opening of Dubai’s metro, which at 75 km is the longest driverless network in the world.

Massive deals

In the first seven months of this year, more than $30bn-worth of metro projects have been awarded.

The largest single project, worth more than $20bn, is the first six lines of Saudi Arabia’s Riyadh metro scheme, awarded in late July to three Spanish, US and Italian-led consortiums.

Work on the design-and-build contracts, which also include the supply of rolling stock and signaling systems, is expected to start early next year.

The award of the Riyadh deal came on the back of $8bn-worth of contracts let earlier this year on the first two lines of the Doha metro project in Qatar.

Aimed at providing sufficient passenger capacity in time for the 2022 FIFA World Cup, the design-build and rolling stock supply contracts involve more than 150 km of underground, at-grade and elevated track sections, as well more than 65 metro stations.

Tenders for the construction of the remaining two lines under the first phase programme are expected to be awarded by year-end.

Future contracts

The Doha and Riyadh metro projects are the first of a raft of metro and rail schemes planned in the GCC. New metro networks are planned in Jeddah, Mecca, Kuwait City and Abu Dhabi.

In Saudi Arabia, the region’s first high-speed network is being built by a Spanish-led consortium between Jeddah and Medina via Mecca.

“The entire region is planning an additional 33,712 km of mainline routes and 3,004 km of metro, monorail and tram lines”

Already operational in the kingdom is a 2,000 km-plus dedicated minerals freight line, completed in 2010, between phosphate and bauxite deposits in the far north and aluminium and fertiliser industrial hubs on the Gulf coast.

Meanwhile, the most ambitious project of all is the planned GCC railway which will eventually link all six GCC states from Kuwait City in the north to the Omani capital, Muscat, in the east.

Taking into account the entire Middle East and North Africa (Mena) region, there are around 33,404 km of mainline rail and 311 km of metro, monorail and tram lines in operation, mainly in North Africa and Iran.

Under the current pipeline of announced projects, the entire region is planning an additional 33,712 km of mainline routes and 3,004 km of metro, monorail and tram lines involving a total investment of close to $200bn.

UK firms must act quickly

Despite the number of opportunities on offer and the comparative lack of regional expertise, UK participation in the Middle East’s railway projects has been limited, with Spanish, German, Italian, Japanese and French technologies and contractors having the biggest presence.

“With the market growing increasingly competitive, UK contractors need to act soon”

As the regional market grows, Russian, Chinese, Turkish and Brazilian firms have been arriving in increasing numbers to take advantage of the projects on offer.

UK contractors have played a traditionally strong role in building the region’s infrastructure and would be welcome to compete on contracts. However, with the market growing increasingly competitive, they need to act soon.

Details of current and upcoming Middle East rail projects are outlined in the MENA Rail Projects 2013 Report, the latest report by MEED Insight, the analysis and consulting arm of Dubai-based MEED, Construction News’ sister magazine.

Comprising more than 110 pages, the report lays out the overarching strategies behind the massive investment planned and provides details of the key projects in each country, along with contact information for the principal clients.

Get the report

MEED’s full report, the MENA Rail Projects 2013 Report, is available to buy for US$3,995. Construction News readers can purchase the report for a special discounted rate of $3,495 by quoting CN_Mena. To purchase, or for more information about the research services offered by MEED Insight, please contact: 

Email: insight@meed.com

Telephone: +971 (0) 4 390 0436

Online: www.meed.com/cn/mena-rail-2013

 

Middle East rail conference

Hear the latest updates on the lucrative MENA rail industry at this year’s MENA Rail conference in Abu Dhabi on 28-30 October. Featuring more than 50 expert speakers from across the region; visit www.meedconferences.com/rail

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