Maghreb rail sector heads for boom

5 July 2024

 

The Maghreb region is headed for a potential surge in railway scheme development, with upcoming projects worth tens of billions of dollars in pre-execution and set to swell the $7.6bn of rail schemes currently at the execution stage, according to regional projects tracker MEED Projects.

There are $18.5bn-worth of rail projects in prequalification or bid in Algeria and Morocco right now, led by an $11.2bn expansion of Morocco’s high-speed railway network.

Building on a $2.4bn stretch of high-speed rail between Tangier and Casablanca that was delivered in 2018, the expansion plans include a further $4.5bn-worth of line development between Kenitra and Marrakech and a $5.6bn line across the more mountainous terrain from Marrakech to Agadir.

Morocco’s rail prospects are also being boosted by the revival of the Spain-Morocco tunnel project.

In June 2023, the Spanish government revived plans for a Morocco-to-Spain undersea rail link project after allocating about $2.5m for a renewed design study. The project was first launched in 2003 but was put on hold after the 2008 financial crisis. It has undergone several rounds of feasibility studies but remains in the study stage after nearly two decades of funding-linked delays.

The plans involve a double-rail track with an additional service line stretching 38.5 kilometres (km) from Tarifa in Spain to Tangier in Morocco. The technically challenging scheme involves a 28km section running under the Mediterranean Sea at a maximum depth of 475 metres below sea level.

This is significantly deeper than the comparable Channel Tunnel between the UK and France, which at its deepest lies only 75 metres below the seabed and 115 metres below sea level.

In Algeria, there is meanwhile upwards of $5bn-worth of work in prequalification as part of the National Railway Programme being pursued by the country’s rail authority Anesrif, including a multibillion-dollar planned rail line to connect Oran on the northwest coast to the Algeria-Mali border.

There is also a significant volume of work in the design and study phases, including a $10bn electrification scheme announced by Algeria and due for prequalification in 2025 and award in early 2026 – a clear sign that Algiers is committed to delivering a modern public transport network.

Other planned rail modernisation and expansion schemes in the region include the Mohammadia-Mascara railway line in Algeria, the extension of Rabat-Sale light rail in Morocco and the extension of the Sfax light rail in Tunisia.

Ongoing projects

In terms of projects already under execution, the rail activity in the region is currently being led almost entirely by $7.4bn-worth of work Algeria. Many of the existing rail projects are long-standing ones, however, with the average duration of ongoing projects exceeding four-and-a-half years.

The value of new project awards in the rail sector in recent years has been subdued. In the past two years, there have been just $1.2bn of rail awards across the four countries of the Maghreb region.

The largest ongoing projects in Algeria are the Oued Tlelat-Akid Abbes railway line upgrade, the Tlemcen-Akid Abbes railway and the Tebessa-Ain M'lila railway line – the combined value of which is about $3.5bn.

In April, Anesrif also restarted the Relizane-Tiaret-Tissemsilt component of its $1.9bn East-West rail network expansion after a pause of several years and a change of contractors.

The contract with the previous group of contractors, which included Spain’s Fomento de Construcciones y Contratas (FCC) and local company Groupe ETRHB Haddad, was terminated.

In June, the client awarded a new $231m contract for lots one and two of the project to a consortium of local contractors, including EPTP Alger, GCB, Infrafer and Societe Algerienne des Ponts et Travaux d’Art.

Lot one includes works on the Relizane, Tiaret, Tissemsilt and Saida/Tiaret sections, spanning 10km. The remaining works are expected to be completed in 10 months. Lot two includes works on the Tiaret and Tissemsilt section, covering 63.5km, and will be due within 20 months.

Another major rail project under way in Algeria is the project to connect the Gara Djebilet iron ore mine in Western Algeria’s Tindouf province with the national rail network at Bechar.

In January, Algeria selected a team of Beijing-headquartered China Railway Construction Corporation and local contractor Cosider Travaux Publics for a contract to build a 575km railway line. The precise value of the project is unknown, but it could be worth $900m-$1.2bn.

In Tunisia, railway projects worth over $227m are in the execution phase. The biggest railway schemes under way include lots one and five of the country’s Rapid Rail Network. Morocco and Libya do not have any major railway schemes under execution, according to MEED Projects.

In general, with few significant projects awarded in the past two years, construction companies and rail sector suppliers will be eagerly awaiting the upcoming opportunities in the region.

If even a modest share of the large volume of work planned in Algeria and Morocco comes to fruition, contractors in the rail sector in the region could experience a boom.

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Yasir Iqbal
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