Infrastructure News

09/20/2018

Bahrain and Saudi Arabia to tender US$3.5 billion causeway PPP next year

Saudi Arabia’s ambassador to Bahrain has stated publicly that the tender for the King Hamad Causeway, a 25km road and rail bridge that will cross the Gulf of Bahrain, will be launched in six months. The estimated construction cost is between US$3 and 4 billion.

The project will follow a build, operate, transfer (BOT) model. It is thought that the causeway will have three lanes in each direction, for road-users, passenger trains and freight trains, respectively.

The Transport Ministers of both countries met earlier this month to discuss the project, and agreed that a coalition of consultancies will be appointed to advise the tender process during the first half of 2019. The authorities are aiming to commence the three-year construction period by mid-2021.

The new causeway will be the second crossing to link the two countries across the Gulf of Bahrain. The existing King Fahd Causeway opened in 1986. An average 45,000 vehicles cross it a day, though in June this year the management recorded an unprecedented 118,000 crossings, indicating the need for alternative routes.

The project has been in planning for some years. It was formally approved by the respective Kings of Bahrain and Saudi Arabia in December 2014 and a study was commissioned in December 2016.

It would certainly be the largest project developed through a public-private partnership in either country. Saudi Arabia is relatively experienced in tendering PPPs, though mainly in the water and waste sector. The government's openness to broadening its use of the model is evident though, as the Ministry of Education launched a Request for Expressions of Interest (RFEOI) in January this year for the design, construction, financing and maintenance of sixty schools.

The utilisation of PPPs for infrastructure projects is not popular in Bahrain. This is changing. Alongside this causeway project, the government is planning to tender a multi-billion metro project to private entities next year.