Gulf
News Online Daily
Published: 7/2/2005, 11:03 (UAE)
Dubai: The Saudi Railways Organisation is inviting private sector participation in the Saudi Landbridge, the first rail link between the Red Sea and the Arabian Gulf, officials said.
"Landbridge will be one of the largest 'build operate transfer' (BOT) projects ever undertaken in the Middle East. It is a key initiative in the Railway Expansion Programme approved by the Kingdom's Supreme Economic Council," said Dr Jobarah Al Suraisry, Saudi Arabia's Minister of Transport.
Dr Al Suraisry is also chairman of the SRO's Board of Directors, who chaired the Project Day.
The project is being modelled on the basis of a concession.
The SRO expects to announce the pre-qualification process in the second quarter of 2005. Invitations to bid will be issued shortly after, most likely in the second half of 2005, officials said.
"The project is part of the Kingdom of Saudi Arabia's privatisation strategy, the objectives of which include generating economic benefits through effective private sector participation in the national economy, creating employment opportunities and rationalising public expenditure," Dr Al Suraisry said.
The company held a meeting in London yesterday to brief investors and other potential private sector participants, including shipping lines, port and rail operators, equipment suppliers and other potential bidders for the project.
"Due to the complexity and multi-disciplinary aspects of the project, we anticipate interested parties will wish to form consortia to bid for the project," Dr Al Suraisry said.
"The Landbridge project will create a new dimension in land transport across the Saudi Arabian Peninsula transforming the existing rail network into a world-class freight and passenger rail system," he said.
"The Landbridge rail network will link Saudi Arabia's three largest ports: from Jeddah Islamic Port in the west, annually handling 2.4 million twenty-foot equivalent units (TEUs), through Riyadh's Dry port, 0.25 million TEUs, to Dammam's King Abdul Aziz Port, 0.75 million TEUs, in the east," he said.
"The interconnected railway tracks will allow large quantities of cargo to be transported at competitive rates, resulting in considerable cost savings," he said.
"Bidders should carefully consider the skills and capabilities required to implement a project of this nature.
"The grand scale and complexity of the project and the exacting operational requirements mean we would expect an appropriate group of different disciplines," said Khalid H. Alyahya, SRO's President.
"The Project Day has provided interested parties with the opportunity to establish contacts and discuss the possibility of co-operative partnerships," he said.
Landbridge
What the initiative is all about
| • |
The construction of a new 950 km railway line between Riyadh, the capital city of Saudi Arabia, and the Red Sea port of Jeddah. |
| • |
The
construction of a new 115 km railway line
between the industrial city of Jubail
in the Eastern Province and the Gulf port
of Dammam. |
| • |
The upgrade
of the existing rail link between Riyadh
and Dammam |
| • |
Integration of the new lines with Jeddah
Islamic Port, King Abdul Aziz Port, Dammam
and Riyadh Dry Port. |
| • |
The
successful BOT tenderer will design, finance,
build and operate the Saudi Landbridge
for a fixed period of time. |
| • |
The
obligations of the selected consortia
will include designing and constructing
the rail network to meet the SRO's specified
criteria and subsequently maintaining
the network at required levels of operational
efficiency. |
| • |
Project
financing is expected to comprise investor
equity and debt from the Saudi Arabian
and international bank markets. The land
required for the projects will be provided
by the Kingdom of Saudi Arabia and core
assets of the SRO will be transferred
to the BOT concessionaire. |
| • |
UBS
Investment Bank, Saudi's the National
Commercial Bank (NCB) and SNCF International
of France are providing financial and
technical advisory services to the SRO. |
|
