Jeddah plans $31bn airport expansion
29 May 2023
Register for MEED’s guest programme
Jeddah Airports Company (Jedco) plans to transform King Abdulaziz International airport (KAIA) into one of the world’s largest airports with a SR115bn ($31bn) expansion plan that will increase its capacity to 114 million passengers a year.
The largest components of the plan cover the design and expansion of Terminal 1 and the construction of a new passenger terminal to be called Terminal 2.
The expected completion date for the expansion project is 2031.
Terminal plans
The Terminal 1 project comprises basic infrastructure and enabling works, the installation of new gates, air bridges and parking aprons, the extension of the automatic people mover, new baggage conveyor systems and lounges, with the goal of increasing annual passenger capacity by 15 million.
Work on the multibillion-dollar scheme is scheduled to start this year, with completion targeted for 2026.
The Terminal 2 project aims to increase the airport’s total capacity to 114 million passengers a year, almost tripling the airport’s 40 million limit today.
Due to start in 2026 and end by 2031, the project will involve constructing a completely new terminal building with dozens of gates, new taxiways, aprons, roads, utilities, and baggage handling and other software systems. It is likely to be worth in excess of $10bn to build.
Jedco is also planning to construct a fourth runway starting in 2025 and completing by 2029 to cope with the increased traffic. Due to space limitations, the new runway will require substantive infrastructure relocation work to accommodate it.
Passenger traffic-focused developments are not the only element of the plan. As part of growing the airport’s commercial proposition, the client is also due to start developing a new logistics area later this year.
Covering more than 3 square kilometres, the facility will house new customs and service buildings as well as several leasable warehouses for the private sector. Construction of the facilities will be implemented in phases with an ultimate scheduled completion date of 2029.
Concurrently, Jedco is building a new Hajj and Umrah terminal. Pilgrims comprise a large portion of passenger traffic, and the new arrivals and departures hall for budget airlines will be able to handle 15 million passengers a year. The project is expected to be completed by 2025.
Another project starting this year is the construction of a new baggage handling facility to expand the airport’s existing capacity. The building will be located next to Terminal 1 and will be integrated with the existing conveyor belt systems.
Passenger demand
The project investment programme is a result of Jedco’s forecast that annual demand will reach 114 million passengers by 2030. Of this figure, the authority estimates 51 million will come from Saudi Arabian Airlines, 21 million from international airlines, and 13 million and 12 million from budget airlines Flynas and Flyadeal, respectively.
The forecast and plans were created in conjunction with key drivers of future passenger demand in the Mecca and Jeddah region, including gigaproject real estate developers Roshn and Uptown Jeddah, air cargo handler Saudi Logistics Services (SAL), and the General Civil Aviation Authority (Gaca) with its subsidiary Matarat Holding. Engineering firms Atkins, Mace and DGJ also inputted into the process. The three companies are the consultants on the capital projects investment plan.
KAIA has three operational terminals. Opened in 2018, Terminal 1 is one of the world’s largest passenger terminals, and caters primarily for the state carrier and domestic flights. The North Terminal handles international airlines, while the Hajj Terminal is dedicated to pilgrim traffic.
Construction work on KAIA has been a key driver of airport-building activity in Saudi Arabia in the past. In 2010, there were over $7bn of contract awards for work at the airport, marking the most active year for airport construction activity on record, according to regional projects tracker MEED Projects.
There are other major airport projects planned in Saudi Arabia. In November, Saudi Arabia’s Crown Prince Mohammed bin Salman bin Abdulaziz al-Saud announced the masterplan for King Salman International airport in Riyadh. If completed on time in 2030, it will become the largest airport in the world in terms of passenger capacity.
The airport aims to accommodate up to 120 million passengers by 2030 and 185 million by 2050. For cargo, the goal is to process 3.5 million tonnes a year by 2050.
Neom airport
Another major airport is planned for Neom. US firm Aecom confirmed on 22 March that it had been awarded a contract to provide project management consultancy (PMC) services for the new airport project.
The airport will be inland, close to the Tabuk end of the 170-kilometre-long Line development. Neom International airport is separate from the Neom Bay airport, which started receiving commercial flights in 2019.
Although not confirmed, it is understood that the first phase of the airport will have the capacity to handle 25 million passengers a year. A second phase could take the capacity up to 50 million passengers a year. There is an aspiration for the airport to become the largest in the world, with a capacity of 100 million passengers a year.
Regional airports
Smaller domestic airports are also being developed. In March, Matarat signed a three-year contract with France’s Egis Group to provide technical support and project management services for 26 regional airports.
The contract aims to establish phased project management portals, update airport project management policies and procedures, and provide technical support for planning and designing.
The contract also involves following up on the implementation of capital projects with Matarat subsidiaries, including Riyadh Airports Company, Jeddah Airports, Dammam Airports and Cluster2.
Register for MEED's guest program now to access this article.
Exclusive from Meed
-
November 2025: Data drives regional projects25 November 2025
-
Bahrain pursues reform amid strain25 November 2025
-
Chinese firms expand oil and gas presence25 November 2025
-
Saudi housing entity awards infrastructure contract24 November 2025
-
Saudi utility firm awards water transmission contract24 November 2025
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
-
November 2025: Data drives regional projects
25 November 2025
Click here to download the PDF
Includes: Top 10 global contractors | Brent Spot Price | Construction output
MEED's 2025 EPC contractor ranking
MEED’s December 2025 report on Bahrain includes:
> COMMENT: Manama pursues reform amid strain
> GVT & ECONOMY: Bahrain’s cautious economic evolution
> BANKING: Mergers loom over Bahrain’s banking system
> OIL & GAS: Bahrain remains in pursuit of hydrocarbon resources
> POWER & WATER: Bahrain advances utility reform
> CONSTRUCTION: Bahrain construction faces major slowdown
> TRANSPORT: Air Asia aviation deal boosts connectivityTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/15149339/main.gif -
Bahrain pursues reform amid strain
25 November 2025
Commentary
John Bambridge
Analysis editorCautious optimism defines Bahrain’s current economic moment as the country presses ahead with a broad agenda of diversification, reform and targeted investment. Yet the more assertively Manama moves to reshape its future, the more the tension between its ambition and its fiscal constraints becomes evident as the defining feature of its policymaking.
Bahrain’s projects sector, which has now been shrinking for the past seven years, is emblematic of the country’s constricted spending. This year, contract awards have fallen to their lowest value in a decade. This signals a decisive shift to a more disciplined investment strategy aligned with fiscal realities and a more selective approach to forward-looking capital spending.
The diminished projects market is in turn a challenge for the financial sector, which now faces a receding pool of project financing and other contracting loans. This is giving further impetus to the potential consolidation of local lenders in the overbanked market, which is also beset by thinning margins, rising compliance costs and pressure to scale amid financial system modernisation. While it could create short-term pain, consolidation should boost the financial health of legacy lenders and provide stability in a sector increasingly being defined by new digital banking models and innovation.
Yet even as some sectors change, Bahrain’s government remains deeply reliant on hydrocarbons, which continues to drive exploration, including in the technically complex Khaleej Al-Bahrain basin. These activities reflect the practical need to maintain oil revenues in the medium term and, should additional recoverable reserves be discovered, a potent source of optimism.
Manana is meanwhile looking to overhaul the utilities sector by creating a dedicated regulator and new national operator. The reforms should make space for greater private participation, drawing more capital into power and water projects while improving efficiency and reducing state expenditure in an aspirationally positive step towards greater long-term sustainability.
Even as fiscal concerns narrow Manama’s policy options, it continues to secure strategic wins. A new aviation agreement with Air Asia establishes Bahrain as a regional hub for one of Asia’s largest low-cost carriers. This move opens new connectivity corridors and, alongside the renewal of direct Gulf Air routes to the US, reinforces Bahrain’s position as a gateway between regions, promising benefits for tourism, logistics and services.
Overall, Bahrain’s economic trajectory remains delicately balanced – marked by reform-driven progress yet tempered by fiscal constraint. But in threading this needle, Manama shows that cautious optimism can still be a powerful catalyst for change.
MEED’s December 2025 report on Bahrain includes:
> GVT & ECONOMY: Bahrain’s cautious economic evolution
> BANKING: Mergers loom over Bahrain’s banking system
> OIL & GAS: Bahrain remains in pursuit of hydrocarbon resources
> POWER & WATER: Bahrain advances utility reform
> CONSTRUCTION: Bahrain construction faces major slowdown
> AVIATION: Bahrain signs game-changer aviation deal with Air AsiaTo see previous issues of MEED Business Review, please click herehttps://image.digitalinsightresearch.in/uploads/NewsArticle/15109785/main.gif -
Chinese firms expand oil and gas presence
25 November 2025
> This package also includes: Larsen & Toubro climbs EPC contractor ranking
Chinese contractors have been present in the oil and gas projects market in the Middle East and North Africa (Mena) region since the turn of this century, but largely remained on the fringes. In a hydrocarbons market that has traditionally been dominated by European and American contractors, and those from Japan and South Korea, Chinese firms have become a rising force, especially since the start of the decade.Economic competitiveness in bid battles, significant improvement in engineering and technological capabilities and commitment to execution schedules have been primary factors behind the success of Chinese contractors in the regional oil and gas projects market since 2020.
Competitive edge
Traditionally, Chinese engineering, procurement and construction (EPC) contractors have enjoyed a lower cost base than their international competitors. This comes from lower manpower costs, access to cheaper materials and equipment, and financial support from state banks.
In addition, Chinese firms have typically had a different attitude to risk than many other contractors. Instead of seeking to turn a profit on specific projects, Chinese firms have entered markets cautiously and, as their knowledge of the local market grew, built a commanding long-term position.More recently, the edge that Chinese contractors enjoy has come from the technical experience they have gained from delivering large-scale, complex projects in their domestic market. While in the past Chinese contractors were only considered capable of delivering basic construction work, they now have some of the best project references in the world.
Regional leaders
Chinese EPC contractors have strengthened their performance in the Mena oil and gas projects market, particularly since the end of the Covid-19 pandemic. Since 2023, the combined value of projects won by Chinese firms has consistently remained well over $13bn, with them winning key contracts on major projects.
The largest EPC scheme under execution by a Chinese contractor in the region is on a project to maintain and increase the oil production potential of the Bul Hanine offshore oil field development in Qatar. China Offshore Oil Engineering Company won contracts worth $4bn for the two main EPC packages of the project in the third quarter of 2025.Also this year, Abu Dhabi’s Taziz awarded the main EPC contract to build a complex of specialty chemicals plants in the Taziz Industrial Chemicals Zone at Ruwais Industrial City to China National Chemical Engineering & Construction Corporation Seven (CC7).
The EPC contract is valued at $1.99bn, with work expected to be completed by Q4 2028. The chemicals cluster, known as Project Salt, will produce 1.9 million tonnes a year of marketable polyvinyl chloride (PVC), ethylene dichloride (EDC), vinyl chloride monomer (VCM) and caustic soda.
Chinese contractors have also enjoyed success in Saudi Arabia, with Aramco having awarded several key EPC contracts to Chinese firms since 2023. China Petroleum Engineering & Construction Company, Sepco and Sinopec Petroleum Services are executing EPC works on four out of the 17 packages of the third expansion phase of Aramco’s Master Gas System project.
Sinopec Group has played a significant role in Aramco’s Jafurah unconventional gas development in Saudi Arabia. In a consortium with Spanish contractor Tecnicas Reunidas, in 2024 Sinopec won packages one and two of the Riyas natural gas liquids scheme, part of the second Jafurah unconventional gas expansion phase. The combined value of the two EPC contracts was $3.2bn.
Just weeks after securing these EPC contracts, the consortium also won the contract to deliver the entire scope of work on the scheme’s third expansion phase, valued at $2.24bn.
In Iraq, China Petroleum Engineering (CPE) won a major contract in August to carry out EPC works on a package covering a major seawater transmission pipeline to be built in Basra as part of the larger Common Seawater Supply Project, which is one of four main components of the estimated $10bn Gas Growth Integrated Project masterplan.
Work on the $2.52bn contract will be carried out by CPE’s engineering arm, China Petroleum Pipeline Engineering.
China has built up extensive resources, from skilled personnel to technical know-how. As the domestic market shows signs of slowing, these resources are being deployed internationally, supporting the growing presence of Chinese contractors in the Mena region.
https://image.digitalinsightresearch.in/uploads/NewsArticle/15149182/main.gif -
Saudi housing entity awards infrastructure contract
24 November 2025
Saudi Arabia’s National Housing Company (NHC) has awarded Riyadh-based Alomaier Trading & Contracting Company a contract to carry out infrastructure works at its Khuzam residential development in Riyadh.
The scope of work covers all infrastructure works across an area of 4,000,000 square metres (sq m) in stage three, phase three of the Khuzam residential project.
Construction works have started, and the project is expected to be completed in 2028.
NHC’s Khuzam project is located to the north of Riyadh, near King Khalid International airport and the Expo 2030 site.
The development will offer more than 50,000 residential units and will include parks, commercial areas and other associated amenities.
It will also feature a grand park spanning an area of more than 4.5 million sq m.
MEED reported in 2020 that Riyadh planned to oversee the development of more than 1 million homes by 2025 to meet growing demand in the kingdom.
By 2030, the Saudi capital aims to more than double its population, from 7-8 million to 15-20 million, and become one of the 10 wealthiest cities in the world.
Alomaier Trading & Contracting is undertaking some major infrastructural development projects across the kingdom.
In 2023, MEED reported that Saudi Arabia’s National Water Company had awarded a contract worth SR371m ($99m) to Alomaier Trading & Contracting. It covers the construction of a sewage network in Dammam’s King Fahd suburb and adjacent areas.
The contract also involves the construction of regression lines with diameters of up to 700 millimetres (mm) and a total length of 300 kilometres (km), as well as five ejection lines with diameters of up to 500mm and a total length of 15km, according to data obtained from the regional projects tracker MEED Projects.
The firm specialises in the construction of roads, railways and other infrastructural development works.
https://image.digitalinsightresearch.in/uploads/NewsArticle/15141143/main.jpeg -
Saudi utility firm awards water transmission contract
24 November 2025
Saudi Arabia’s state-owned utility National Water Company (NWC) has awarded a contract for the operation and maintenance of water distribution networks to local firm International Water Distribution Company (Tawzea).
The project comprises the operation and maintenance of water transmission pipelines in Medina province, Sisco Holding announced.
Sisco Holding, also known as Saudi Industrial Services Company, holds a 50% stake in Tawzea. The other 50% stake is owned by Amiantit Water, a subsidiary of Saudi Arabian Amiantit Company.
The contract is valued at SR133.4m ($35.6m) and has a duration of 36 months.
It covers main and secondary pipelines, reservoirs, pumping stations, valves and all related components of the water distribution system.
NWC has also been advancing major sewer network expansion plans in Hafar Al-Batin and Al-Qaisomah.
The utility recently awarded local firm Alkhorayef Water & Power Technologies (AWPT) a contract to deliver the next phase of this project.
The phase four (part two) package involves constructing about 184 kilometres of sanitary sewer pipeline.
As of September, NWC had awarded $337m-worth of contracts. This includes a separate contract awarded to AWPT in August for a sewage network scheme in Al-Kharj governorate.
https://image.digitalinsightresearch.in/uploads/NewsArticle/15140733/main.jpg