Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships

Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships
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The “Journey Through Time Masterplan” was recently announced by Crown Prince Mohammed bin Salman. (Supplied)
Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships
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Around $2 billion has already been invested in the project and $3.2 billion is set to be spent on priority infrastructure. (Supplied)
Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships
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The full $15 billion AlUla masterplan will be developed in three phases in 2023, 2030, and 2035. (Supplied)
Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships
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One of the first opportunities for private participation in the project is in the hospitality sector. (Supplied)
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Updated 28 April 2021

Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships

Royal Commission for AlUla confirms $15 billion masterplan opportunity for public-private partnerships
  • Royal Commission for AlUla in talks with potential private investors, hospitality brands for participation in $15 billion masterplan

DUBAI: Saudi Arabia has invested $2 billion in initial seed funding for the development of the AlUla historical development area.

And a further $3.2 billion, which will come from public-private partnerships, has been earmarked for spending on priority infrastructure ahead of the completion of phase one of the project in 2023, the chief executive officer overseeing the development told Arab News.

“We are well into executing phase one. This includes the upgrade of the airport, which has been completed. We will start our low-carbon tram development infrastructure as well. And, so far, our visitor experience centers in the heritage and nature site are being upgraded,” said Amr AlMadani, CEO of the Royal Commission for AlUla (RCU), the entity set up by the Saudi Ministry of Finance in July 2017 to manage the development of the site.

Around $2 billion has already been invested in the project and $3.2 billion is set to be spent on priority infrastructure. This will include the first 22 kilometers of a 46-kilometer low-carbon tramway system, the development of a renewable energy network, and the upgrading of the water supply system and wastewater treatment plant.

The full $15 billion AlUla masterplan will be developed in three phases in 2023, 2030, and 2035. Located 1,100 kilometers from Riyadh, AlUla consists of 22,561 square kilometers of lush oasis valleys, sandstone mountains, and ancient cultural heritage sites, including Hegra, Saudi Arabia’s first UNESCO World Heritage Site.

A 52-hectare ancient city, Hegra was the principal southern city of the Nabataean kingdom and is comprised of nearly 100 tombs with elaborate facades cut into the sandstone.

 

 

The “Journey Through Time Masterplan” was recently announced by Crown Prince Mohammed bin Salman. Upon completion in 2035, the development project aims to create 38,000 new jobs, attract 2 million visitors a year, expand the population of the area to 130,000, and contribute $32 billion to the Kingdom’s economy.

“We’re in the market. We are already actively engaged with multiple investing firms and fund structures to participate starting today. The business plans for these investments are becoming more viable for investors to look at. This is an interactive journey with investors, and our portal online invites all investors to register and seek to engage today,” added AlMadani.

One of the first opportunities for private participation in the project is in the hospitality sector. The site will have 9,400 hotel rooms when complete, with work on the first resorts set to start in October.

“A key item for the private sector to participate in, we expect that the rollout requires around 1,000 resort keys (in phase one) for the anticipated travel numbers.

“We have invested in 200 (hotel rooms) that will hit the market this year. Currently, the private sector has already participated in another 150, so huge opportunity,” AlMadani said.

International hospitality brands such as Accor/Banyan Tree, and Habitas have already confirmed their participation, and more are set to be added by the end of this year.

“We are actually in talks with at least two to three unique hotel operators. We can’t actually mention the names without fully reaching content management agreement, but I can assure you that, from the big players, the unique nature resort operators, the interest is amazing.

“At least two of the large hotel chains that have luxury brands fit for AlUla will be announced by end of this year,” the CEO added.

AlMadani said the majority of initial investment interest had so far come from domestic players, but as the project begins to take shape international players were expected to come on board in partnership with local developers and investors.

“I think generally it’s all about credibility of the plans. People want to make sure that there is consistency, the vision is clear, but delivery is the key item as well.

“Definitely the investment appetite is building up quite fast in the local market. Saudi Arabia’s investment capabilities in the private sector aren’t small, and it’s a major player in global investment as well. I think the first ones will be local, but with huge international participation, and soon enough we think international funds will play a role,” he added.

The Kingdoms Institute – AlUla’s global hub for archaeological and conservation research – has conducted extensive excavations at the site and this week announced significant archaeological discoveries. The team has discovered more than 1,000 mustatils which were previously unknown. Mustatils, which means rectangular in Arabic, are ancient stone-walled structures.

Mustatil research is a priority for the RCU and the process of uncovering them is currently the focus for a Discovery Channel documentary series. The parallel processes of excavation and commercial development at the ancient site could be challenging, but AlMadani noted that it was one of the most exciting elements of working on the project.

“Having to realize the potential of this amazing cultural landscape, bringing it out to the world as a living museum, while ensuring that we give residents new economic opportunities and travelers unique experiences, having this all come together in an integrated manner is actually the challenge that we are today enjoying, celebrating and sharing the masterplan with the world,” he said.

“It’s about developing correctly, having to break the stigma that development comes at the price of nature. How can we make sure development is actually complementary and is a plus? It’s a plus to the place that we are developing.

“This is what we are excited about, to issue to the world a new model for sustainable development that respects culture, heritage, and the people of the land.”


Saudi delivery startup raises $2.4m to expand outside KSA

Saudi delivery startup raises $2.4m to expand outside KSA
Updated 29 July 2021

Saudi delivery startup raises $2.4m to expand outside KSA

Saudi delivery startup raises $2.4m to expand outside KSA
  • The startup uses artificial intelligence and a mobile application to partner companies

JEDDAH: WeDeliver, a parcel delivery startup headquartered in Riyadh, has secured SR9 million ($2.4 million) as part of its first pre-seed investment round, it was announced on Wednesday. I coudn’t find a ‘WeDelivery’ in an online search.

The startup uses artificial intelligence and a mobile application to partner companies that have parcels to be delivered with a network of freelance drivers close by.

The company launched its operations in the Kingdom in April last year, just weeks after the pandemic took hold. Starting first in Riyadh, it has since expanded to Jeddah and the Eastern Province.

Ahmad Ramahi, co-founder and CEO of WeDeliver, said in a press statement: “WeDeliver is a MENA startup with a global vision, driven by an experienced team. We have ambitious plans to enrich our growth in the Saudi market and look forward to expanding to new regional markets.

“We believe that our asset-light collaborative model will disrupt intra-city logistics, enabling faster, more efficient, low-cost delivery for businesses and online sellers,” he added. Nasser Al-Maawi, another cofounder of the startup, said that WeDeliver has seen “strong results” and reported “300 percent growth in the second quarter of this year.”

According to a recent industry report, Saudi startups raised more than a quarter of a billion dollars in venture capital (VC) funding during the first half of 2021.

A total of $1.228 billion was raised by startups in the Middle East and North Africa (MENA) in the first six months of the year, a rise of 63 percent year on year and 12 percent more than was raised during the whole of 2020, according to figures from the MENA H1 2021 Venture Investment Report, published by Dubai-based research platform Magnitt.

According to the report, the top three countries in the MENA region for startup funding were the UAE, Egypt and Saudi Arabia, accounting for 71 percent of total investment. The UAE was the dominant market, making up 26 percent of total funding, followed by Egypt with 24 percent and Saudi Arabia with 21 percent, for a total of $257.88 million.

“It’s also important to note that within this top three ranking, Egypt was the only geography to observe a deal count increase year on year, while Saudi Arabia has almost closed the deal count gap with UAE from 44 deals in 2020 to just an 11-deal difference in H1 2021,” the report said. The food and beverage sector was the most popular among VCs in terms of dollars invested, while the fintech sector generated the most deals.

According to this year’s Global Entrepreneurship Monitor report, total entrepreneurial activity in Saudi Arabia increased in 2020 by 24 percent compared to 2019. It also showed that more than 90 percent of adults saw entrepreneurship as a favorable career choice, while a third of Saudis surveyed said that they were keen on launching a business within the next three years.


MasterCard launches support for cryptocurrency startups

MasterCard launches support for cryptocurrency startups
Updated 29 July 2021

MasterCard launches support for cryptocurrency startups

MasterCard launches support for cryptocurrency startups
  • XRP, a cryptocurrency that Ripple uses in its payments network, rose 15.48 percent on Wednesday

RIYADH: Bitcoin traded higher on Wednesday, rising by 3.95 percent to $39,808.10 at 4:21 p.m. Riyadh time. Ether, the world’s second most-traded cryptocurrency, was down 0.29 percent to $2,291.10, according to data from CoinDesk.

XRP, a cryptocurrency that Ripple uses in its payments network, rose 15.48 percent on Wednesday, trading at $0.74, its highest level since June 21. This represents a daily gain of 13 percent, after the company said it is targeting the $1.8 billion Filipino Remittance Corridor. Ripple announced that Japanese money transfer provider SBI Remit and Philippine mobile payment service Coins.ph have teamed up to move remittance payments from Japan to the Philippines, CoinDesk reported.

Earlier this week, US Sen. Elizabeth Warren wrote to Treasury Secretary Janet Yellen outlining several concerns about the risks posed by cryptocurrencies. Warren asked Yellen to act urgently and adopt appropriate policies to address her concerns.

She claimed that the longer the US waits to introduce the appropriate regulatory regime for these assets, the more likely they will become so entangled in the financial system, potentially creating serious consequences if this market comes under pressure. 

The senator from Massachusetts said: “I have become increasingly concerned about the dangers cryptocurrencies pose to investors, consumers, and the environment in the absence of sufficient regulation in the US,” according to Bitcoin News.

MasterCard on Tuesday announced a new global program dedicated to supporting fast-growing digital assets, blockchain and cryptocurrency companies. Seven startups have signed up for the Start Path program. With Mastercard, the startups will expand and accelerate innovation around digital asset technology and make it safer and easier for people and organizations to buy, spend and hold cryptocurrency and digital assets, Bitcoin News reported.


ExxonMobil, Sabic US petrochemical complex to operate end of 2021

ExxonMobil, Sabic US petrochemical complex to operate end of 2021
Updated 28 July 2021

ExxonMobil, Sabic US petrochemical complex to operate end of 2021

ExxonMobil, Sabic US petrochemical complex to operate end of 2021
  • The project, located near Corpus Christi, Texas, is expected to begin ahead of schedule, likely in the fourth quarter of 2021

RIYADH: A petrochemical complex on the US coast being built Saudi Basic Industries Corporation (SABIC) and ExxonMobil is expected to be operational by the end of 2021, the US energy company said.

The complex — which is being developed by Gulf Coast Growth Ventures (GCGV), a joint-owned company by the Saudi and US companies — has reached mechanical completion of a monoethylene glycol unit and two polyethylene units, ExxonMobil said.

“Gulf Coast Growth Ventures is a key development of our plan to serve growing demand for our high value performance products,” said Karen McKee, ExxonMobil President. 

The project, located near Corpus Christi, Texas, is expected to begin ahead of schedule, likely in the fourth quarter of 2021.

“Not only are we ahead of schedule, but we have executed this project with the highest commitment and emphasis on safety with nearly 18 million safe person-hours worked, all while acting on the promises we made to the community when we started this journey four years ago,” said Abdulrahman Al-Fageeh, SABIC’s executive vice president of petrochemicals. 

GCGV will produce 1,100 kilotons of monoethylene glycol and 1,300 kilotons of polyethylene per year upon completion.

“The benefits of this strategic joint venture will not only accrue to SABIC but also to Saudi Aramco, which bought the company from the Public Investment Fund to create a Saudi synergy in local petrochemical production,” independent economist and former professor of finance and economics at King Fahd University of Petroleum and Minerals Dr. Mohamed Ramady told Arab news.

Once in full production, the new venture will add a welcome stream of additional revenue to SABIC’s profitability and its market value. It is expected to reinforce the Kingdom’s diversification into high-value hydrocarbon products through high-performance plastics, adding to SABIC’s portfolio of agri-nutrients and metals, he said.

“This new strategic joint venture cements the ongoing relationship that SABIC has built over the years with international partners as part of its plans to service its key overseas markets with high quality petrochemical downstream products,” he added.

The project created more than 600 permanent jobs with average salaries of $90,000 per year and an additional 6,000 high-paying jobs were created during construction.

The project is expected to be delivered under budget and at approximately 25 percent less than the average cost of similar projects along the US Gulf Coast.


Oil nears $75 on US inventory decline as pandemic concerns recede

Oil nears $75 on US inventory decline as pandemic concerns recede
Updated 28 July 2021

Oil nears $75 on US inventory decline as pandemic concerns recede

Oil nears $75 on US inventory decline as pandemic concerns recede
  • ‘Supply is likely to remain tight even with the production hikes set by OPEC+,’ says broker

LONDON/RIYADH: Brent crude approached $75 a barrel on Wednesday as a report showed US inventories fell more than expected last week, moving the market’s focus away from concerns that rising coronavirus disease (COVID-19) infections will hurt demand.

Crude in storage fell to the lowest since January 2020, while distillate supplies posted the biggest decline since April, according to a report from the US Energy Information Agency. Fuel inventories fell by more than 2 million barrels.

WTI, the US benchmark, added 0.5 percent to $72.03 a barrel as of 3:48 p.m. in London, while Brent climbed 0.3 percent to $74.72.

Oil is 45 percent higher this year, boosted by a return of demand, as economies have reopened following millions of doses of COVID-19 vaccines, while OPEC+ has kept supply tight.

However, OPEC+ agreed to increase supply by 400,000 barrels a day every month from August, leading to speculation as to whether demand will continue to return.

“Oil supply is likely to remain tight even with the production hikes set by OPEC+,” Naeem Aslam, from online broker Avatrade, told Reuters.

Russia’s flagship Urals crude oil has mostly been used in Europe so far this year due to relatively low output and high prices, while Asian markets have shunned the blend, data showed on Wednesday.

As a result, Russia has lagged behind Saudi Arabia in China’s energy market, one of the world’s largest.

According to Refinitiv Eikon data, the port of Rotterdam, Europe’s biggest oil hub, received 9.7 million tons of Urals in the first half of this year, up from 7.3 million tons in the same period last year.

At the same time, supplies of seaborne Urals cargoes to China plunged to 1.8 million tons from 7.86 million in the first half of 2020.

This year, the spread between Brent — to which Urals is linked — and the Middle Eastern Dubai blend has reached an all-time high of more than $4 per barrel, making Russian oil uncompetitive in Asia.

India has also cut purchases of Urals, while South Korea and Thailand have completely stopped intake of the blend.

Some European countries, notably Finland, have also reduced purchases of seaborne Urals amid the move to greener economies.


Saudi Arabia anticipates 1 trillion riyal injection from 4IR technology

Saudi Arabia anticipates 1 trillion riyal injection from 4IR technology
Updated 28 July 2021

Saudi Arabia anticipates 1 trillion riyal injection from 4IR technology

Saudi Arabia anticipates 1 trillion riyal injection from 4IR technology
  • Artificial intelligence and smart cities will see Saudi Arabia rebrand as a global technology hub

RIYADH: Advanced technology from the Fourth Industrial Revolution (4IR) is expected to generate around 1 trillion riyals for the Saudi economy in new revenue streams, a senior Saudi official told a conference in Riyadh today.

The Kingdom will enjoy economic boosts from robotics, artificial intelligence, and wireless production models as it pushes for more smarter cities and infrastructure.

In his opening remarks of the Saudi 4IR conference, Minister of Communications and Information Technology Abdullah Alsawaha announced the inauguration of the Saudi 4IR center in collaboration with WEF and said that the center will spur more innovation as Saudi cities must keep pace with technological developments.
He told an audience at the two-day conference, being held at King Abdullah City for Science and Technology, that the Kingdom is building the most technologically advanced infrastructure in the new NEOM giga-project, which will be a global technology center.

The impact of the 4IR is expected to be massive, with non-oil gross domestic product anticipated to increase by more than 4 percent from 2017 to 2030, generating 1 trillion riyals in new revenues, Abdullah Alghamdi, the president of Saudi Data and Artificial Intelligence Authority (SDAIA) said in his opening remarks.

He added that SDAIA is working on developing customized platforms for each  city to accommodate their specific needs.

The concept of a Fourth Industrial Revolution was first suggested by Klaus Schwab, chairman of the World Economic Forum, and was the theme of the annual WEF meeting at Davos in 2016. WEF opened its first 4IR Center in San Francisco in 2016, and there are now centers in 13 countries, including Saudi Arabia.

"With this launch you have become part of our growing global network of centers, Schwab said in his remarks to the conference.

Saudi Arabia has invested heavily in digitizing its cities, with 60 percent of the Kingdom’s urban centers covered by 5G networks, said Haytham Alohali, vice minister of communications and information technology.

The government has developed one of the most advanced E-government systems in the world and has established data and AI to support its digital transformation, minister of industry Bandar Alkhorayaf said, adding that the Kingdom has a strong manufacturing base with over 10,000 factories 40 specialized integrated industrial cities that provide the required infrastructure and services needed for the manufacturing facilities and workforce.

The world's leading petrochemical producer, SABIC, strives to keep pace with technical developments and is focused on digital transformation in artificial intelligence, machines, and robotics, CEO Yousef Albenyan told the conference. It also seeks to provide smart solutions to its customers and enhance the competitive process, he added.