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• 
  Acwa Power starts production at new Shuaibah plant

  3 April 2025

  The new seawater reverse osmosis (SWRO) technology-based plant in Shuaibah, Saudi Arabia, has started water production following the decommissioning of the old plant running on multi-stage flash (MSF) technology.

  The new plant will cater to the water needs of Jeddah and Makkah Al-Mukarramah, especially during peak demand periods such as the Ramadan and Hajj seasons.

  Saudi utility developer Acwa Power CEO Marco Arcelli said in a social media post that the company has begun producing “green” water from the new SWRO plant in Shuaibah following the decommissioning of the old MSF desalination plant there.

  “We bid farewell to the first ever Acwa Power plant to jump into the future with one of the most efficient and green plants in the world, reducing power consumption by 87%, integrating 65MW of locally produced solar power, and bringing 22 million barrels of oil and 9 million tonnes of carbon dioxide annually to zero,” Arcelli said.

  The old MSF-based plant was part of the first independent water and power project (IWPP) to be developed in Saudi Arabia when the government opened the market for private investment. It became operational in 2010.

  Acwa Power, Shuaibah Water Electricity Company (Swec) and Saudi Water Partnership Company (SWPC) agreed to convert the water desalination component of the Shuaibah 3 IWPP into an SWRO plant in June 2022.

  At the time, the stakeholders announced that “operations of Shuaibah 3 IWPP will cease in 2025, saving nearly 45 million tonnes of carbon dioxide emissions and 22 million barrels of light crude oil annually”.

  A consortium led by Acwa Power and Public Investment Fund (PIF)-owned Badeel is developing the new facility, known as the Shuaibah 3 independent water project (IWP), at a cost of approximately SR3bn ($800m).

  It will produce 600,000 cubic metres of water a day once complete.

  The Acwa Power-led team agreed to have 40% local content in the construction phase and 50% in the operation and maintenance phase for the first five years, which will eventually increase to 70%.

  Swec is the project company that developed, financed and operated the Shuaibah 3 IWPP. It comprised Acwa Power (30%); a Malaysian consortium of Tenaga Nasional, Malakoff Berhad and Khazanah Nasional (30%); PIF (32%); and Saudi Electricity Company (8%).

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  Jennifer Aguinaldo
• 
  Read the April 2025 MEED Business Review

  3 April 2025

  Download / Subscribe / 14-day trial access

  Governments in the Middle East and North Africa (Mena) region are digging deep to find solutions to the challenges posed by booming populations and rapidly growing cities. It is hoped that by expanding their underground infrastructure, major urban
  centres such as Dubai, Riyadh and Doha can alleviate the mounting pressure that is being put on their existing transport and utility networks.

  Subterranean transport projects, such as the high-profile Dubai Loop scheme being planned by the Roads & Transport Authority in partnership with Elon Musk's The Boring Company, or the recently completed metro systems in Riyadh and Doha, promise to tackle urban congestion and slash commute times. Meanwhile, through large-scale underground utilities schemes like the Dubai Strategic Sewerage Tunnels project, the traditional wastewater network can be upgraded without disturbing the existing cityscape.

  As a result, while governments globally are curtailing public infrastructure spending to reduce public debt, GlobalData has revealed that the Mena region has a tunnel construction pipeline worth $128.6bn.

  In the April edition of MEED Business Review, we take an in-depth look at the various subterranean transport and utility projects that are in the pipeline in the Mena region, and examine the outlook for major tunnelling projects globally. 

  MEED's latest issue also includes a comprehensive report on the region's tourism and hospitality sector, as Saudi Arabia strives to join Qatar and the UAE as one of the GCC’s leading leisure tourism destinations. Indeed, the kingdom dominates when it comes to hospitality-linked project activity, with contracts worth a total of $4.4bn awarded last year.

  Saudi Arabia is also the focus of this month’s exclusive 21-page market report, which finds the kingdom looking forward to a positive year in 2025. As Riyadh takes the diplomatic initiative, particularly as an intermediary in the Ukraine conflict, the kingdom's non-oil economy is also going from strength to strength.

  Although lower oil prices are expected to slightly dent revenues this year, Saudi Aramco is planning sustained capital expenditure and remains intent on projects to expand the production of high-value petrochemicals. Meanwhile, 2025 is expected to be a year of stable profitability for Saudi Arabia’s banks, and is set to be the busiest year ever for the power sector. Construction awards also remain up as Riyadh shifts its focus to delivering the infrastructure and transport projects that are needed for the kingdom’s hosting of upcoming international events.

  This issue is also packed with analysis. We find out how BP’s planned $25bn investment in Iraqi oil fields will benefit Chinese contractors, round up the top five GCC data centre projects, look at why the rapid deployment of low-cost solar power is causing a surge in battery energy storage demand, and discover that Riyadh's need to diversify its sources of project financing has led to a sharp rise in the value of public-private partnerships in Saudi Arabia.

  In the April issue, the team also speaks exclusively to CEO of Edmond de Rothschild Asset Management UK and global head of infrastructure and structured finance, Jean-Francis Dusch, about Saudi infrastructure investment opportunities; and talks to Mark Thomas, group CEO of Bapco Energies, about how the state energy conglomerate plans to secure Bahrain’s hydrocarbons potential.

  We hope our valued subscribers enjoy the April 2025 issue of MEED Business Review. 

  

   

  Must-read sections in the April 2025 issue of MEED Business Review include:

  > AGENDA: 
  > Traffic drives construction underground
  > Muted public spending hinders global tunnelling

  > CURRENT AFFAIRS:
  > Chinese contractors to benefit from BP’s investment in Iraq

  INDUSTRY REPORT: Tourism and hospitality > Beaches and luxury drive regional tourism > Region’s hotel projects pipeline balloons

  > INTERVIEWS:
  > Investing in Saudi Arabia’s infrastructure opportunities
  > Securing Bahrain’s hydrocarbons potential

  > DATA CENTRES: GCC’s top five data centre projects

  > POWER: GCC battery storage pipeline hits over 55GWh

  > SAUDI PPPs: Rise in PPPs reflects Saudi budgetary pragmatism

  > SAUDI ARABIA MARKET REPORT: 
  > COMMENT: Riyadh enjoys buoyant fortunes
  > GOVERNMENT: Riyadh takes the diplomatic initiative
  > ECONOMY: Saudi Arabia’s non-oil economy forges onward
  > BANKING: Saudi banks work to keep pace with credit expansion
  > UPSTREAM: Saudi oil and gas spending to surpass 2024 level
  > DOWNSTREAM: Aramco’s recalibrated chemical goals reflect realism
  > POWER: Saudi power sector enters busiest year
  > WATER: Saudi water contracts set another annual record
  > CONSTRUCTION: Reprioritisation underpins Saudi construction
  > TRANSPORT: Riyadh pushes ahead with infrastructure development
  > DATABANK: Saudi Arabia’s growth trend heads up

  > MEED COMMENTS: 
  > Saudi Arabia is high-rise capital of the world
  > Dubai needs to deliver more metro lines
  > US and UAE power play gains momentum
  > Libya’s new oil licensing round could be make or break

  > GULF PROJECTS INDEX: Gulf index sees minor correction

  > FEBRUARY 2025 CONTRACTS: Project awards slump notably in February

  > ECONOMIC DATA: Data drives regional projects

  > OPINION: Is this the end for Middle East studies?

  > BUSINESS OUTLOOK: Finance, oil and gas, construction, power and water contracts

  To see previous issues of MEED Business Review, please click here

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  MEED Editorial
• 
  Australian firm wins Trojena dams subcontract

  3 April 2025

  Australian firm Glaass has won a subcontract from Italian contractor Webuild for the Trojena dams project in Neom, Saudi Arabia.

  In an official statement, the firm said its contract scope covers providing comprehensive quality, health, safety and environmental services for the project, which involves around 2,800 field workers.

  Neom awarded Webuild a $5bn contract in late 2023. The deal covers the construction of three dams that will form a freshwater lake for the Trojena ski resort.

  The main dam will be 145 metres high and 475 metres long at its crest. It will be built using 2.7 million cubic metres of roller compact concrete (RCC).

  Some 650,000 cubic metres of RCC will be used to build a dam within the planned lake, creating an island below the water level.

  The kidney-shaped dam will be 38 metres high and 700 metres long. It will be connected to the nearby Lake Village by an underwater tunnel. The landscaping and other attractions within the dam are known as the Enchanted Forest.

  The third dam will be 65 metres high and 490 metres long at its crest. It will be constructed using 4.15 million cubic metres of rockfill. The works also include the lakebed line and the foundations for the Bow Building, a concrete structure at the end of the lake that will overhang the valley below and incorporate a hotel.

  ---

  Hear directly from the gigaproject owners at the biggest construction event—The Saudi Giga Projects 2025 Summit, happening in Riyadh from 12-14 May 2025. Click here to know more

  ---

  MEED’s April 2025 report on Saudi Arabia includes:

  > GOVERNMENT: Riyadh takes the diplomatic initiative
  > ECONOMY: Saudi Arabia’s non-oil economy forges onward
  > BANKING: Saudi banks work to keep pace with credit expansion
  > UPSTREAM: Saudi oil and gas spending to surpass 2024 level
  > DOWNSTREAM: Aramco’s recalibrated chemical goals reflect realism
  > POWER: Saudi power sector enters busiest year
  > WATER: Saudi water contracts set another annual record
  > CONSTRUCTION: Reprioritisation underpins Saudi construction
  > TRANSPORT: Riyadh pushes ahead with infrastructure development
  > DATABANK: Saudi Arabia’s growth trend heads up

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  Yasir Iqbal
• 
  Wood shares drop after financial warning

  3 April 2025

  Shares in the UK-based engineering company Wood Group dropped by 25% after it announced that accounting issues would delay the publication of its full-year results for 2024.

  The company, which has numerous project contracts around the Middle East and North Africa, said it had identified “material weaknesses and failures” in its financial culture within its projects business unit, following an independent review conducted by financial services company Deloitte.

  Wood said the failures included “inappropriate management pressure and override to maintain previously reported positions”, and led to instances of information withheld from Wood’s auditors.

  It also said there was an inappropriate “over-optimism and/or lack of evidence in respect of accounting judgements”.

  Wood has project contracts in Iraq, Kuwait, Oman, Qatar, Saudi Arabia and the UAE, where the company opened its third office in Sharjah.

  The firm’s regional projects pipeline includes pre-front-end engineering and design (pre-feed) work on Saudi Aramco’s Southern and Northern Areas project in Saudi Arabia.

  It is also working on an integrated feed, detailed design, procurement support, and construction and commissioning assistance for TotalEnergies in Iraq.

  In its latest statement, Wood said: “We are committed to implementing a detailed remediation plan, including necessary follow-on actions from the review, to continue to strengthen the group’s financial culture, governance and controls.

  “This will include actions on culture, controls and organisational structure.”

  As a result of the initial report from Deloitte, Wood said:

  • A number of prior year adjustments are expected to be required for the income statement and balance sheet
  • Issues identified in a limited number of contracts in the Projects Business Unit, particularly in relation to legacy lump-sum turnkey projects
  • Issues with the application of relevant accounting standards, such as holding specific amounts on the projects balance sheet that should have been written off
  • Gaps and deficiencies within the application of controls, which relate to the monitoring and reporting of project positions within the Projects Business Unit
  • No material issues identified in our other business units (Consulting, Operations and Investment Services)

  Extensive work is needed to conclude the audit, according to Wood.

  The company has said that it is now expected to have to delay the publication of its full-year accounts and will not publish them for 2024 by 30 April 2025 as was previously expected.

  It also said that if the publication of its results is delayed, the company’s shares will be suspended from trading from 30 April 2025 as work progresses towards completion of its FY24 accounts.

  Commenting on its engagement with lenders, Wood said: “We remain in constructive dialogue with the group’s lenders regarding refinancing options and will engage with lenders in respect of the timing of our FY24 accounts, including putting in place appropriate pre-emptive waivers under our committed debt facilities.”

  Last month, Wood said it had extended the deadline for talks regarding a possible takeover by Dubai-based Dar Al-Handasah Consultants Shair & Partners Holdings (Sidara).

  The new deadline was set for 17 April.

  In its latest statement, Wood said that it remains in discussions with Sidara about a possible cash offer for “the entire issued and to be issued share capital of the company”.

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• 
  Traffic drives construction underground

  3 April 2025

  

   

  On 14 February, Dubai construction was thrust again onto the global stage when Elon Musk, the world’s richest man, announced plans to explore the development of an underground Dubai Loop transportation system, along the lines of the Las Vegas Convention Centre Loop project in the US.

  Dubai has typically made headlines globally by constructing the world’s tallest towers. As the city becomes increasingly congested on the surface, it is taking some of its largest construction projects underground.

  With Musk’s backing, the Dubai Loop scheme is the most high-profile tunnelling project launched to date. It involves carving a futuristic transport system underneath Dubai. The initial phase of the project is currently being studied by Dubai’s Roads & Transport Authority (RTA) in partnership with The Boring Company, which is owned by Musk. It will cover 17 kilometres (km) and have 11 stations, with the capacity to transport over 20,000 passengers an hour.

  The project highlights the importance of expanding underground infrastructure in the Middle East region. This is mostly necessitated by the pressure that rapidly growing cities have put on existing transport and utility networks, particularly in major urban centres such as Dubai, Riyadh and Doha.

  Underground opportunities

  Projects that involve tunnelling, such as metro rail systems, underground highways and pedestrian walkways, are deemed key enablers in reducing congestion and optimising land use.

  The recently completed metro systems in Riyadh and Doha are examples of how underground rail networks can facilitate efficient urban mobility, and more such schemes are planned. 

  Without these subterranean projects, cities risk being stuck in a permanent state of gridlock, with longer commute times and decreased productivity. At the same time, tunnelling allows urban planners to integrate sustainable transport solutions, as well as large-scale utilities networks, without disturbing existing cityscapes, thereby enhancing connectivity and economic growth.

  These developments signal a major shift in engineering priorities, with regional governments investing in underground transport, sewerage and metro extensions to accommodate their growing populations and infrastructure needs.

  While the tower crane-dotted skylines of urban centres in the GCC attract attention, delivering major projects underground is an equally impressive engineering feat. Tunnelling under busy cities requires advanced excavation techniques, careful planning and coordination to avoid disruptions.

  More tunnelling work is expected as Dubai takes another significant step forward in tackling its ongoing traffic problems [with] a new metro link

  UAE tunnelling projects

  Tunnelling work forms a significant portion of the Dubai Metro Blue Line extension. Awarded in December for AED20.5bn ($5.5bn), the project includes 15.5km of underground track and five subterranean stations. When operational in 2029, the Blue Line will significantly expand Dubai’s metro capacity, linking major residential and commercial hubs.

  More tunnelling work is expected as Dubai takes another significant step forward in tackling its ongoing traffic problems by starting the procurement process for its next metro link: the Gold Line.

  Although the technical details of the project have yet to be revealed, it is expected that tunnels will form a major component of the scheme given that the new line will run through busy urban areas where there is little space to build overground. 

  The Gold Line will start at Al-Ghubaiba in Bur Dubai. It will run parallel to – and alleviate pressure on – the existing Red Line, before heading inland to Business Bay, Meydan, Global Village and residential developments in Dubailand.

  As a first step, the RTA has sent a request for proposals to companies for the lead consultancy role on the multibillion-dollar project.

  The UAE’s Etihad Rail also began a study of the tunnels required for the high-speed railway line connecting Abu Dhabi and Dubai in January. The survey works are ongoing on the Jaddaf and Dusup tunnels that will serve the high-speed rail link. Initial plans for the project include tunnelling works totalling 31km.

  Another major tunnelling project in the UAE is the $22bn Dubai Strategic Sewerage Tunnels scheme. The client, Dubai Municipality, is preparing to tender its first packages, which include deep tunnels that will stretch 42km in Jebel Ali and 16km in Warsan.

  The project will be delivered under a public-private partnership model, with international consortiums competing for contracts. Once completed, these tunnels will replace the traditional wastewater network, reducing energy consumption and enhancing long-term sustainability.

  Saudi schemes

  In Saudi Arabia, Riyadh is preparing to expand its metro network with the addition of a Line 7 and an extension to the existing Line 2.

  The total length of Line 7 will be about 65km, of which 47km will be underground. The line will have 19 stations, 14 of which will be underground.

  The project involves constructing a metro line linking the Qiddiya entertainment city development, King Abdullah International Gardens, King Salman Park, Misk City and Diriyah Gate. 

  In March, the Royal Commission for Riyadh City (RCRC) gave consortiums until 15 June to submit their bids for a design-and-build contract for the construction of Line 7.

  The planned Line 2 extension is 8.4km long, of which 7.1km is underground, and three out of its five stations will be built underground. The RCRC is expected to award the construction contract this year.

  In January, the kingdom also completed the phased roll-out of the Riyadh Metro network. The current network comprises six lines spanning about 176km, of which 74km is constructed underground.

  These numbers indicate that over 42% of the overall network is underground, highlighting the growing importance of tunnels in the kingdom’s plans to improve infrastructure in its most densely populated cities.

  Tunnelling works are also a key component of the plans to improve the stormwater drainage system in Jeddah, where the municipality is preparing for the construction of the King Abdullah Road-Falasteen Road tunnel.

  The three-year scheme involves constructing 5.3km of tunnels with an internal diameter of 7.2 metres using tunnel boring machines (TBMs) and another 3.4km of tunnels with a diameter of 3.5 metres driven by pipe jacking or TBMs.

  At the kingdom’s Neom gigaproject, city planners are looking to find solutions to many of the problems faced in existing cities and, as a result, tunnels and large-scale underground utilities corridors are being built at the beginning of the project. For example, the development’s Delta Junction tunnels will serve as a railway junction connecting the Spine infrastructure corridor with the Neom Connector rail link to the Oxagon industrial zone. 

  The project involves 26.5km of tunnelling work that will be split into a north and a south lot. The construction works are expected to begin this year as the client is evaluating the revised proposals submitted by firms in November last year.

  Kuwait Metro will feature extensive tunnelling … ensuring minimal disruption to existing roads while integrating with future transport networks

  Further tunnel projects

  Beyond the Gulf, Egypt has a long history of tunnelling projects, as it has had to deal with crippling congestion and urban overcrowding for decades. In the 1980s, work was completed on two major projects that involved tunnelling: the first phase of the Cairo Metro system and the Greater Cairo wastewater project, which involved the construction of sewage tunnels on the east and west banks of the Nile. 

  Today, Cairo’s tunnelling projects include the Cairo Metro Line 4 project. Spanning 42km with 39 stations, it involves over 20km of tunnels.

  Meanwhile, in Morocco, national railway operator L’Office National des Chemins de Fer (ONCF) is constructing a tunnel project in Rabat.

  In February, ONCF announced a 3.3km tunnel to be constructed under the Bou Regreg river at an estimated cost of MD1.4bn ($140m). The tunnel will connect the Sale and Agdal stations in an effort to alleviate traffic.

  Similarly, the long-awaited Kuwait Metro will feature extensive tunnelling to navigate the dense urban fabric of Kuwait City, ensuring minimal disruption to existing roads while integrating with future transport networks. 

  Qatar’s expansion of Doha Metro, meanwhile, requires additional underground infrastructure to connect developing areas and support the country’s vision for a comprehensive public transport system. 

  Mecca Metro, already serving millions of pilgrims, is also set for further expansion, likely involving significant tunnelling to facilitate smoother access to holy sites while overcoming geographic constraints. 

  In Oman, the Muscat Metro project is likewise expected to link key districts while preserving the city’s landscape and avoiding disruptions to arterial roads by introducing underground sections. 

  All of these projects show that tunnels will play an important role in the region’s future as it strives to create cities with more efficient and environmentally sustainable transit and utilities systems. 

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  Yasir Iqbal