World’s tallest tower is back on track
24 October 2024
The chairman of Saudi Arabia’s Kingdom Holding, Prince Alwaleed Bin Talal Al-Saud, published a two-word message on social media platform X on 2 October. The message, which said, “We’re back,” was accompanied by an animated video of a fly-through rendering of the world’s next tallest building, the 1,000-metre-plus Jeddah Tower.
The post was made shortly after a pivotal event for the tower. Earlier that day, the company developing the project, Jeddah Economic Company (JEC), in which Kingdom Holding is a shareholder, signed a contract with the local Saudi Binladin Group (SBG) to resume construction work on the scheme. The SR7.2bn ($2bn) contract includes SR1.1bn for works already completed on the tower.
SBG was the original contractor on the project before construction work stalled in 2018. This left the tower’s superstructure about one-third complete, with 63 floors built out of 157.
Speaking to MEED after the contract signing, Kingdom Holding’s CEO Talal Ibrahim Almaiman echoed and expanded on Prince Alwaleed’s post.
“We’re back. People have been asking questions about the project after it froze in February 2018. We had the patience, but also the determination to finish it. We will deliver what we promised to deliver at the highest possible quality, with a contractor with a long history of success when it comes to handling such huge projects,” he says.
Contractor selection
Appointing a firm to build a tower that will be the world’s tallest is more than just a major contract signing.
“There are plenty of successes. Saudi Arabia will soon have the record for the tallest tower in the world. Kingdom Holding is doing what it does best, completing projects at the highest level. Saudi Binladin is going to get back its glory. And the people of Jeddah will have the tallest tower in the world,” says Almaiman.
The appointment of the original contractor after having started a fresh tender process for the project in late 2023 has taken some in the market by surprise.
“Rather than talk about the past, I would like to talk about the future,” says Almaiman.
“SBG has gone through some technical and financial difficulties in the past. The latest announcement, when the Ministry of Finance said it would support them with their issues with the banks, gave them huge financial credibility. The government of Saudi Arabia being a partner and shareholder in SBG gives us huge confidence,” he adds.
With financial issues put to one side, SBG was able to put together a winning proposal to complete the tower. “The contractor spent a lot of time with our designers, quantity surveyors and other experts and went through each part of the tower and how they plan to build it by moving from floor to floor, and this method was approved by us,” says Almaiman.
Programme and price were also key factors. “The other consortium we spoke to was planning to finish in 58 months, whereas Binladin was saying 42 months, which is three and a half years,” Almaiman explains, adding: “For pricing, we got a good deal.”
In addition, there were several practical reasons for selecting the original contractor on the project, according to Almaiman. SBG already has offices established on site and, as a Jeddah-based company with a long history of delivering major projects in Saudi Arabia, it has well-established connections with the local supply chain.
With financial issues put to one side, SBG was able to put together a winning proposal to complete the tower
Future vision
Although the Jeddah Tower project has a history that can be traced back over a decade, its ambitions are very much in tune with those of modern Saudi Arabia.
“It is in line with the government’s Vision 2030 to create attractions for Saudi Arabia,” says Almaiman.
Vision 2030 reinforces the importance of the three-and-a-half-year programme that SBG offered because it puts the tower comfortably on course to be delivered in mid-2028, well ahead of 2030.
Completing the world’s tallest tower is just the start for the wider Jeddah Economic City development.
“The tower is part of phase one, which is about 1.1 million square metres,” says Almaiman.
“We are now in discussions with investors about coming in and developing. We will contribute land. We will not be selling land at phase one for the sake of selling. We will control the development and the building code,” he adds.
Securing the title
Building the world’s tallest tower inevitably prompts conversations and speculation about other rival towers being planned around the world.
However, Almaiman is confident that Jeddah Tower’s reign as the world’s tallest will be lengthy, as he, perhaps better than anyone else, understands the challenges involved in building record-breaking towers.
“The reason for calling the tower 1,000-plus-metres is because we will add more height. The final height of the tower will be decided by HRH Prince Alwaleed Bin Talal,” he says.
“The other developers will probably need around 10 years to catch up, and if we keep the title for that long, I will be happy.”
Exclusive from Meed
-
Dubai budgets to increase construction spending by 18%
30 October 2024
-
Linde wins Hail and Ghasha project CO2 capture contract
30 October 2024
-
Dubai receives $22bn tunnels investor prequalifications
30 October 2024
-
Chinese firm wins facade work on world’s tallest tower
30 October 2024
-
TotalEnergies $11bn hydrogen project starts pre-feed
30 October 2024
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends
Related Articles
-
Dubai budgets to increase construction spending by 18%
30 October 2024
Dubai has announced its budget for 2025 with a 9% increase in government spending, which includes an extra $1.6bn allocated for construction and infrastructure compared to the approved budget for 2024.
Of the AED86.26bn ($23.5bn) of planned spending, 46%, or AED39bn ($10.6bn), will be allocated for construction and infrastructure schemes.
“These projects encompass roads, tunnels, bridges, transportation systems, sewage stations, parks, renewable energy facilities and the rainwater drainage network development plan. This also includes the recently announced Al-Maktoum airport development project and other initiatives supporting quality of life and promoting smart and sustainable transportation strategies in Dubai,” the emirate’s finance department said in a statement.
The spending on construction and infrastructure planned for 2025 is 18% more than the AED33.2bn allocated for 2024.
Increasing construction spending will help the emirate overcome some of its most pressing infrastructure challenges. Traffic has become a major issue for many residents and businesses in Dubai. Over the past year, the emirate’s Roads & Transport Authority (RTA) has pressed ahead with a series of road projects aimed at alleviating congestion. The most recent road project to be announced is the AED696m upgrade to the Trade Centre roundabout in Dubai.
Metro plans
A new metro line is also planned. In October, contracting consortiums submitted bids for the contract to complete a new Blue Line that will form part of the Dubai Metro network. The lowest-priced base offer received for the contract was valued at AED22.3bn. The project was given a budget of AED18bn when approved by the government in late 2023.
Another infrastructure concern is maintaining Dubai’s status as a leading global aviation hub. Dubai International airport is operating at close to capacity. With no room to add to its two existing runways, a major new airport project is planned at Al-Maktoum International airport. Designs for that project, valued at $35bn, were approved by the government in April and all operations at Dubai International airport are scheduled to move there within 10 years. Tendering for major construction contracts is expected to start in 2025.
Another pressing infrastructure concern is drainage. Widespread flooding in April this year exposed many shortcomings of the emirate’s infrastructure. In June, the government approved a AED30bn project known as Tasreef, which will enhance the capacity of Dubai’s rainwater drainage system by 700%, covering all areas of the emirate.
The emirate’s sewage system will also be upgraded with the $22bn Dubai Strategic Sewerage Tunnels (DSST) project. This project will be delivered as a public-private partnership. Potential investors submitted their statements of qualifications (SoQs) in late October.
Spending approval
The 2025 budget was approved by Sheikh Mohammed Bin Rashid Al-Maktoum, Vice President, Prime Minister and Ruler of Dubai, on 29 October.
The estimated expenditure for 2025 is a 9% increase on the AED79.1bn of spending that was budgeted for 2024 in November 2023. As well as expenditure of AED86.26bn for 2025, revenues are projected to be AED97.66bn. The budget also includes a general reserve of AED5bn.
The 2025 budget also allocated 30% of government expenditures to the social development sector. This encompasses health, education, scientific research, housing, and support for needy families, women and children. It also includes investments in youth and sports, and care for the elderly, retirees and people of determination.
The security, justice and safety sectors will receive 18% of total expenditures. The emirate has also allocated 6% of spending to support the public services sector, government excellence, creativity, innovation and scientific research.
The 2025 budget is part of the three-year budget cycle for 2025-27, which Sheikh Mohammed also approved. It has a total expenditure of AED272bn and a total revenue of AED302bn, making it the largest in the emirate’s history.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12820502/main.jpg -
Linde wins Hail and Ghasha project CO2 capture contract
30 October 2024
Register for MEED’s 14-day trial access
Germany-headquartered Linde Engineering has announced winning a contract to provide carbon capture technology for Abu Dhabi National Oil Company’s (Adnoc) estimated $17bn Hail and Ghasha sour gas field development project.
The deal has been awarded to Linde as a sub-contract by NextChem, a subsidiary of Italy-based Maire, the main contractor performing engineering, procurement and construction (EPC) works on the $8.74bn onshore package of the Hail and Ghasha project.
In June, Maire appointed NextChem as the technology design integrator to develop the process design package (PDP) for the hydrogen and carbon dioxide (CO2) recovery unit of the Hail and Ghasha onshore package.
As part of its contract, Linde will provide its adsorption-based carbon capture technology Hisorp CC, plus the core units, to capture and purify CO2 for sequestration (CCS). The CO2 recovery facility will have a total capacity to capture and store 1.5 million tonnes a year of emissions from the Hail and Ghasha scheme.
Linde’s Hisorp CC is an electrically-driven technology that can power the carbon capture process with renewable energy. It combines pressure swing adsorption with cryogenic separation and compression to achieve CO2 capture rates of over 99%. The process does not require steam for regeneration, so it does not increase the carbon footprint.
Hail and Ghasha scheme
The Ghasha concession consists of the Hail and Ghasha fields, along with the Hair Dalma, Satah, Bu Haseer, Nasr, Sarb, Shuwaihat and Mubarraz fields.
Adnoc Group owns and operates the Ghasha concession, holding the majority 55% stake. The other stakeholders in the asset are Italian energy major Eni with a 25% stake, Thailand’s PTTEP Holding with 10% and Austria’s OMV and Russia’s Lukoil with 5% interests each.
Adnoc expects total gas production from the concession to ramp up to more than 1.5 billion cubic feet a day (cf/d) before the end of the decade. This target will mainly be achieved through the Hail and Ghasha sour gas development project.
In October last year, Adnoc and its partners awarded $16.94bn of EPC contracts for its Hail and Ghasha project – the biggest capital expenditure made by the Abu Dhabi energy company on a single project in its history.
While Adnoc awarded the onshore EPC package to Tecnimont, the offshore EPC package was awarded to a consortium of Abu Dhabi’s NMDC Energy and Italian contractor Saipem.
The $8.2bn contract relates to EPC work on offshore facilities, including facilities on artificial islands and subsea pipelines.
Prior to reaching the final investment decision on the Hail and Ghasha project last year, the Ghasha concession partners, led by Adnoc, awarded two EPC contracts worth $1.46bn in November 2021 to execute offshore and onshore EPC works on the Dalma gas development project.
ALSO READ: Tecnimont awards sub-contracts on Hail and Ghasha scheme
https://image.digitalinsightresearch.in/uploads/NewsArticle/12819918/main5129.jpg -
Dubai receives $22bn tunnels investor prequalifications
30 October 2024
Register for MEED's 14-day trial access
Potential investors have submitted their statements of qualifications (SoQs) for a contract to develop and operate various packages of the $22bn Dubai Strategic Sewerage Tunnels (DSST) project.
MEED understands that the project client, the Dubai Municipality, received SoQs from over a dozen companies, including several prequalified as engineering, procurement and construction (EPC) contractors for the project’s first four packages.
According to industry sources, the companies that are keen to prequalify as investors or sponsors of the planned public-private partnership (PPP) project include:
- Abrdn Investcorp Infrastructure Investments Manager (UK)
- Besix (Belgium)
- China Railway Construction Corporation (CRCC)
- China Railway Engineering Group (CREG)
- China State Construction Engineering Corporation (China)
- Itochu (Japan)
- Plenary (Australia)
- Samsung C&T (South Korea)
- Vision Invest (Saudi Arabia)
- WeBuild (Italy)
The project client and its consultants held a consortium match-making event for prospective contractors and sponsors or investors in Dubai on 7 October.
MEED previously reported that the bidders for the six PPP packages would be prequalified consortiums comprised of sponsors or investors; EPC contractors; and operations and maintenance contractors.
The overall project will require a capital expenditure of about AED30bn ($8bn), while the whole-life cost over the full concession terms of the entire project is estimated to reach AED80bn.
The investor prequalification process for the scheme comes after the client prequalified EPC contractors that can partner with the developers or investors to bid for the contracts.
MEED understands that packages J1 and W will be tendered together as separate contracts first, followed by J2 and J3, with the requests for proposals to be issued sequentially, staggered about six to 12 months apart.
Dubai Municipality is expected to invite prequalified companies to submit bids for the contracts to develop the first two packages of the DSST project in the fourth quarter of 2024.
DSST packages
Under the current plan, the $22bn DSST project is broken down into six packages, which will be tendered as PPP packages with concession periods lasting between 25 and 35 years.
The first package, J1, comprises Jebel Ali tunnels (North) and terminal pump stations (TPS). The tunnels will extend approximately 42 kilometres (km), and the links will extend 10km.
The second package, J2, covers the southern section of the Jebel Ali tunnels, which will extend 16km and have a link stretching 46km.
W for Warsan, the third package, comprises 16km of tunnels, TPS and 46km of links.
J3, the fourth package, comprises 129km of links.
J1, J2, W and J3 will comprise the deep sewerage tunnels, links and TPS (TLT) components of the overall project.
J1, J2 and W will be procured under a design-build-finance-operate-maintain model with a concession period of 25-35 years.
J3 will be procured under a design-build-finance model with a concession period of 25-35 years. Once completed, Dubai Municipality will operate J3, unlike the first three packages, which are planned to be operated and maintained by the winning PPP contractors.
The project’s remaining two packages entail expanding and upgrading the Jebel Ali and Warsan sewage treatment plants.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12804424/main.jpg -
Chinese firm wins facade work on world’s tallest tower
30 October 2024
Register for MEED’s 14-day trial access
Saudi Binladin Group (SBG) has awarded Beijing-headquartered Jangho Group a facade works contract on what will be the world’s tallest tower – the 1,000-metre-plus Jeddah Tower in Saudi Arabia.
Jangho Group will provide engineering design and technical services for the project’s structural glass and adhesive curtain walls.
The announcement comes after the client, Jeddah Economic Company (JEC), signed an estimated SR8bn ($2.1bn) contract with SBG to resume construction work on the project.
When completed, Jeddah Tower will be more than 172 metres taller than the 828-metre-tall Burj Khalifa, the world’s tallest building since 2009.
Jeddah Tower’s superstructure is about one-third complete, with 63 floors out of a total of 157. SBG was the main contractor on the project in the early and mid-2010s. Germany’s Bauer completed the tower’s piling work.
The architect is US-based Adrian Smith & Gordon Gill, and the engineering consultant is Lebanon’s Dar Al-Handasah (Shair & Partners).
Jeddah Tower is the centrepiece of the Jeddah Economic City development. The project’s first phase, which includes the main tower, covers an area of 1.5 million square metres.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12819518/main.jpg -
TotalEnergies $11bn hydrogen project starts pre-feed
30 October 2024
France’s TotalEnergies has started the pre-front-end engineering and design (feed) for its planned $11bn integrated project to produce green hydrogen and ammonia in Morocco, according to a company spokesperson.
TotalEnergies signed the joint development agreement with the relevant authorities and ministers in Morocco on 28 October, during French President Emmanuel Macron’s visit to the North African state.
It was previously reported that the planned integrated facility would be located in Guelmim-Oued Noun in southern Morocco.
TotalEnergies’ chairman and CEO, Patrick Pouyanne, signed the agreement for the local production of green hydrogen and ammonia in the presence of Morocco’s King Mohammed VI and Macron.
The counterparties included Morocco’s Energy Minister, Leila Benali; Economy and Finance Minister, Nadia Fattah; Interior Minister, Abdelouafi Laftit; and Minister Delegate in charge of Investment, Karim Zidane.
It is understood that the project will require the development of 10GW of solar and wind energy and a land area of 187,000 hectares.
It was reported that Morocco’s Unified Regional Investment Commission had approved the project’s launch in November 2022.
The other agreements signed during Macron’s visit to Morocco cover financial cooperation in the rail, forestry, aviation, logistics and energy sectors, with a particular focus on decarbonisation and energy transition.
TotalEnergies has been exploring green hydrogen and other related projects in the Middle East and North Africa region.
In August, the Courbevoie-headquartered firm and Abu Dhabi Future Energy Company (Masdar) signed an agreement to assess the viability of developing a commercial green hydrogen-to-methanol-to-sustainable aviation fuel (saf) project.
It is also among the early investors in UK-based Xlinks First, which aims to deliver the $18bn Morocco-UK power interconnector project. TotalEnergies acquired a minority stake in the company following an investment of $25.4m announced in November last year.
https://image.digitalinsightresearch.in/uploads/NewsArticle/12819510/main.gif