JEDDAH, 22 December 2004 — Saudi Railways Organization (SRO) announced a project day for the Saudi Landbridge to be held in London on Jan. 31. The day is being observed to seek international investment in a rail project to build more than 1,000 km of new track across the Kingdom.
The day also marks the promotion of the plan among potential investors before issuing invitations to apply for prequalification for the build, operate and transfer (BOT) scheme.
Dr. Jabara Al-Seraisry, minister of transport and chairman of SRO’s board of directors, will preside over the proceedings of the project day. Dr. Al-Seraisry said the SRO was planning a 950-km link between Jeddah and Riyadh, tying into an existing line between Riyadh and Dammam. It also wants to build another railway running 115 km north from Dammam to Jubail Industrial City.
The Landbridge is the cornerstone of the Railway Expansion Program approved by the Supreme Economic Council. The project is to be implemented through private sector participation as a BOT concession. It will be the first-ever rail link between the Red Sea and the Gulf and is expected to have a profound impact on shipping patterns in the region. A considerable saving in shipping time for goods originating in Europe and North America and destined for Gulf markets should be possible with the Landbridge.
The project day is being held to disseminate information that will assist key players in related industries and other prospective investors in forming consortiums to bid for the project.
Riyadh and Dammam, the Kingdom’s major port on the Gulf, are currently linked by two lines — a 556-km single track built in the 1950s, used only by freight trains, and the other a 449-km single track built in the 1980s, used exclusively by passenger trains. Annual traffic volume over the existing network amounts to about 300 million passenger/km and one billion ton/km of cargo.
“We’re convinced that ... the time is ripe for bringing to Saudi Arabia the many benefits of an expanded rail network. The Supreme Economic Council’s decision to implement the Landbridge project through private sector participation and privatize SRO in the process, is in line with the government’s declared policies of allowing greater private participation in sectors which in the past have been the exclusive domain of the public sector,” Dr. Al-Seraisry said.
The Saudi Landbridge will transform the existing rail network in the Kingdom into a world-class freight and passenger rail link across the country. It will have the capability of moving large quantities of cargo over long distances at competitive rates and will offer safe, comfortable and fast overland passenger transport between the country’s four major economic centers. The railway will connect the port cities of Jeddah, Dammam and Jubail via Riyadh.
Riyadh’s Dry Port, which handled in 2003 more than 250,000 TEUs transported by rail from and to Dammam’s King Abdul Aziz Port, is expected to experience a large boost in its activity once the Landbridge becomes operational. Since its opening in 1981, the Dry Port has proved very popular with importers in Riyadh who highly value the facility of clearing their custom bonded goods at their final destination rather than in Dammam. The Landbridge will extend the same facility to imports via the Jeddah Islamic Port. The seaports in Jeddah and Dammam are the largest in the Kingdom handling on annual basis 2.40 million and 0.75 million TEUs respectively.
“We’re delighted to announce the Landbridge Project Day,” said Khalid Alyahya, president of SRO and chairman of the Inter-Ministerial Committee. “A tremendous amount of preparatory work for launching the tender for the BOT concession has been completed and we look forward to explaining our plans and ensuring that interested organizations can meet each other and consider how they want to participate in this very important multibillion-riyal project. We expect strong participation from financial investors, construction companies, shipping lines, port operators, rail operators and equipment suppliers. We want to make sure that everybody understands the real potential of the Saudi Landbridge,” he added.
