JEDDAH: A new company will soon be formed to manage the Riyadh-Jeddah Railway (known as the land-bridge project) once a consortium of companies win the contract.
The consortium, which will be allowed to manage the project for 50 years, will have an 80 percent stake in the company, while the government will have the remaining, said Abdul Aziz Al-Hoqail, president of the Saudi Railway Organization (SRO) following a meeting if its board of directors in Dammam.
The land-bridge project involves the construction of 950 km of new railway tracks between Riyadh and Jeddah, and another 115-km line between Dammam and Jubail. It is the cornerstone of a massive multibillion-riyal railway expansion project and will be the first rail link between the Red Sea and the Gulf.
Four consortia - Agility PWC Logistics Consortium, Mada Consortium, Saudi Binladin Consortium and Al-Muhaidib/ACWA (Tarabot) Consortium - have presented their financial and technical offers to implement the project, which is estimated to cost more than $5 billion.
"We have already presented two proposals regarding the new company and the new transport law to higher authorities for approval," the SRO chief said, adding that the formation of the proposed company would be a major step toward the privatization of the Kingdom's railways.
The board meeting, which was chaired by Transport Minister Dr. Jabara Al-Seraisry, discussed the latest developments in the land bridge and Haramain projects. The board expressed its satisfaction over the increase in SRO's revenues from SR362 million in 2006 to SR418 million in 2007.
The Haramain railway project linking the two holy cities of Makkah and Madinah, which is known as MMRL, includes the construction of approximately 500 km of new high-speed electrified railway lines between Jeddah-Makkah and Jeddah-Madinah. Railway lines will be equipped with modern signaling and telecommunications systems.
Six consortia - the Al-Rajhi Consortium, the Saudi Binladin Group, Saudi Oger, the Saudi Japanese Consortium, the Al-Sholah Consortium and the OHL International - are vying for the MMRL contract. MMRL will have stations at the Jeddah Islamic Port, the King Abdul Aziz International Airport and the King Abdullah Economic City in Rabigh.
"There is considerable progress in the Haramain project. We have presented to the Supreme Economic Council a report asking for its approval of the railway line. We have also prepared the design for civilian works, including the railway track and stations," Al-Hoqail said.
Last February, Custodian of the Two Holy Mosques King Abdullah ordered the implementation of the Haramain project using local funds.
The royal directive is expected to speed up the implementation of the project, which will reduce travel time between Jeddah and Makkah to 30 minutes and between Jeddah and Madinah to no more than two hours.
The MMRL aims to provide a safe, fast, and comfortable mode of transport for an estimated 10 million Umrah and Haj pilgrims traveling between the two holy cities and Jeddah. The project will be implemented on a design, build, operate and transfer (DBOT) basis.