A consortium comprising UBS Investment Bank ("UBS") and The National Commercial Bank ("NCB") has been selected by the Kingdom of Saudi Arabia (the "KSA") to provide Financial Advisory Services for the Saudi Railway Expansion Project, Eng. Khalid H Alyahya, President of Saudi Railways Organization ("SRO"), announced on Tuesday. He added, "We are very pleased to work with such a strong consortium, combining UBS's global expertise in railway financing and NCB's extensive knowledge of the Saudi market."

In 2002, the KSA announced its intention to take forward development of plans to implement the Saudi Railway Expansion Project, comprising a landbridge linking the Red Sea port of Jeddah to the Arabian Gulf port of Dammam via Riyadh (the "Saudi Landbridge") and a rail link between the holy cities of Makkah and Madinah via Jeddah (the "Makkah Madinah Rail Link"). SRO has been designated by the Supreme Economic Council of Saudi Arabia as the "Executing Agency" for the two projects.

The process for development of the projects will examine possible technical and commercial solutions as well as the structure of the concessions that will be offered to the private sector on a BOT basis. It is envisaged at this stage that the Saudi Landbridge and Makkah Madinah Rail Link will be offered as separate concessions, both attractive as distinct commercial proposals.

Several studies related to the projects have been undertaken by the World Bank and renowned international technical firms. Subsequently, SRO has already been approached by several international and national companies expressing an interest in participating in the projects.

Due to the complexity and multi-disciplinary aspects of the projects, SRO expects that interested parties will wish to form consortia to bid for the projects. Once the different options for scope and structure of the concessions have been formulated, SRO will arrange project briefings to present the scope and structure of the proposed concessions, which will facilitate the formation of tender consortia.

Abdulhadi Shayif, General Manager of NCB, remarked that "connecting the Red Sea to the Gulf will confirm Jeddah Islamic Port's position as a trade hub for the entire region. Furthermore, for Muslims worldwide, connecting the two holy cities of Makkah and Madinah via a rail link is an inspiring proposition." Hasan Aljabri, Country Corporate Head of NCB, added, "These two concessions represent a major step in the KSA's privatisation process."

Stephen Paine, Managing Director at UBS, commented that "UBS and NCB are extremely pleased to be working with the KSA on these landmark transactions." He added, "in view of studies already completed and the concrete steps taken by the KSA in relation to privatisation, the prospects for the private sector undertaking the future development of railways in Saudi Arabia are very encouraging."

Over the next few months, SRO looks forward to a great deal of input and interest from the private sector in developing the two projects. Basic project information will be available at http://www.saudirailexpansion.com from 1 January 2004.

SRO invites interested parties to submit their enquiries through the website.