The ever-changing Saudi landbridge
It was our retired colleague Hansueli Hof, a proven railways expert who is still well-known to many of our readers, who first wrote about the project known as the Saudi landbridge in the ITJ (issue 23-24 / 2004). Even if not all the dreams described have come true, the vision of developing a relatively basic railfreight transport network in Saudi Arabia into an extensive rail system remains unchanged.
Investment projects in rail transport are popular these days. More often than not, however, the focus is on high-speed passenger trains. One such project in California, with an estimated USD 68 billion price tag, is but one example. The bidding process for the project is expected to be completed by May 2014.
Transferring freight to the railways
In 2004, planning for a so-called Saudi landbridge embodied very different expectations. The mega-project was designed to «expand the country’s rudimentary network around Dammam and Riyadh» and to establish, above all, national rail connectivity from the Red Sea to the Arabian Gulf, linking the ports of Jeddah and Yanbu and the urban agglomerations of Mecca and Medina in the west, on the one hand, with Riyadh in the centre of the country and Jubail in the east.
The plan was accompanied by a project to privatise the Saudi Railways Organisation (SRO). Above all the plan was expected to, in a first step, increase the volume of railfreight traffic to 13.4 million t by 2010. After a second phase of development the prediction was that the volume of goods transport by rail would increase to 31.5 million t by 2030.
Competition in the bidding process
There was no dearth of investors for the project, but the process ended up dragging along. After a preliminary round a decision was taken to award the concession to the Tarabot consortium, which included Saudi businesses and the Australian company Asciano. The next round of decision-making on the financial aspects then failed, however, and in 2011 the Saudi government announced that the project was now to be managed by the state.
USD 7 billion was raised for the landbridge project. It is however, just one of many projects in the desert nation. Indeed, due to the level of its investments in infrastructure, Saudi Arabia was recently catapulted from 45th to 3rd place as a market for the logistics and transport industry in Agility’s emerging markets logistics index for 2014. The country plans to make USD 79 billion worth of investments in its railway network by 2020.
But the Saudi landbridge has lost its premier status to the 450 km Haramain high-speed rail link, which will connect Mecca, Medina and Jeddah, and to a 2,400 km north–south rail link from Al Haditha on the Jordanian border to the phosphate processing plants in Riyadh. The SRO, meanwhile, is still firmly in state hands.