Saudis May Award Railway Bids for Chemicals, Mining Hubs

Saudi Arabia may award bids to build a railway connecting its petrochemical and mining hubs on the Persian Gulf early next year, an official said.

Saudi Railway Co. may begin work on a 335-kilometer (208- mile) railway linking Jubail, Ras al-Khair and Dammam in 2013, Ahmed al-Balawi, the royal commission’s general manager for technical affairs at Jubail and Yanbu, said in an interview.

The royal commission has postponed plans to expand the King Fahad industrial port at Jubail, the major port for petrochemical exporters in Saudi Arabia, for at least five years. “In 2008, we were rushing to expand the port but when the global recession hit exporters, we reconsidered our plans,” he said today in Khobar.

The existing port in Jubail is capable of handling exports from the new SATORP refinery and $20 billion Sadara chemical plant Saudi Arabian Oil Co. is building with Total SA and Dow Chemical Co. (DOW) “We’ve already allocated lands in the port for both projects to build their own export facilities,” he said.

The royal commission plans to award 12.65 billion Saudi riyals ($3.37 billion) in contracts for engineering and construction work at the Jubail petrochemical hub, he told a conference in Khobar. The work will include roads, housing, water-treatment facilities and chemical plant infrastructure.

The commission will also award 5.98 billion riyals in construction contracts to the mining center of Ras al-Khair, he said.

To contact the reporter on this story: Wael Mahdi in Khobar, Saudi Arabia at wmahdi@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net