Riyadh’s $22.5 billion urban rail and bus system project is on track despite the Saudi government’s austerity measures after oil revenues fell in 2016, a major contractor of the project revealed. The Metro is the biggest infrastructure project in the history of the Saudi capital.
“We are progressing. The project is going on satisfactorily. It is a priority project” for the government, Pietro Bagnati, project director for the Italian construction group Salini Impregilo, was quoted by the Saudi Gazette newspaper as saying.
His firm leads the ArRiyadh New Mobility consortium, one of the three foreign groups building the six-line Metro project planned to cover 179 kilometers of the sprawling, congested city. The underground and elevated rail network is to be supported by a bus system.
Asked if there had been any cuts to New Mobility’s portion of the project, the Line 3 railway covering 42 kilometers, Bagnati said, “Our contract is still the same.”
He spoke on the sidelines of the EU-GCC Business Forum which aims to strengthen trade and investment ties between the European Union and the six-nation Gulf Cooperation Council. The EU is the Gulf’s biggest trading partner.
The construction work on the Riyadh Metro began in late 2013 with 2018 the date initially targeted for completion.
EU Commissioner for Transport Violeta Bulc said that she understood the completion date to be 2019, and described the Metro as “the biggest global project in urban mobility”.
Bulc, who opened the EU-GCC forum, spoke to reporters after touring the Metro’s tunnels and stations.
“The deadlines are very demanding but so far they’re following… the deadlines well,” she said. “As far as I could tell… it’s moving well.”
Reductions in capital spending
Analysts say that Saudi Arabia made significant reductions last year in its capital spending, including infrastructure, to adjust to falling oil prices since 2014. This year’s budget projects saw a rise in infrastructure and transport spending to SR52 billion ($13.9 billion) from SR37.5 billion in 2016.
The government says it will finish paying early this year billions of dollars it owes to private firms, chiefly in the construction sector, after cuts to projects as oil revenues fell.
The ArRiyadh New Mobility consortium has been awarded a contract to design and build Line 3, which will be the longest line at 40·7 km and have 22 stations.
The consortium comprises two groups. The electrical and mechanical equipment is to be delivered by the Electrical Work Group comprising Ansaldo STS and Bombardier Transportation. Infrastructure will be delivered by the Civil Work Group of Salini-Impregilo, Larsen & Toubro and Nesma.
Riyadh’s population of nearly 6 million is forecast to increase to 8 million by 2030. The new metro system will meet the demands of the growing population while reducing traffic congestion and improving air quality.
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