Morocco leads Maghreb energy transition
11 July 2023
More on Morocco’s power and water sector:
> Morocco seeks firms for 400MW pumped storage contract
> Morocco extends Casablanca water PPP deadline
> US firm plans 2MW Morocco hydrogen project
> China's Tinci plans $280m Morocco lithium-ion plant
> Xlinks to seek construction partners
> Morocco signs $6.4bn electric battery and storage deal
> Morocco tenders 900MW power plant contract

Morocco is among the list of Maghreb countries that have seen few deals awarded in the power generation sector over the past 12 to 24 months.
The last contract awards it recorded were in April 2022 for the 333MW first phase of the Noor 2 solar photovoltaic (PV) project.
The Moroccan Agency for Sustainable Energy (Masen) and Morocco’s Energy Transition & Sustainable Development Ministry awarded six packages of this tranche to three independent power producer (IPP) developers: Voltalia Maroc, Enel Green Power Morocco and the UAE-based Amea Power.
Xlinks scheme
The country, however, could emerge from the doldrums with key projects such as the $18bn Xlinks on the horizon, enabling it to hold on to its status as the regional leader in renewable energy.
The Morocco-UK power project entails building 10,500MW solar and wind farms in Morocco’s Guelmim-Oued Noun region and sending 3,600MW a day of energy exclusively to the UK via four 3,800-kilometre high-voltage, direct current (HVDC) cables.
MEED understands the first phase of the surveys for the project is complete, with geophysical and geotechnical surveys expected to finish this year and next year.
The HVDC pipeline will pass through Spain, Portugal and France, where permitting processes are being undertaken. Financing sources could include export credit agencies, multilateral development agencies and commercial or investment banks.
Morocco aims to source up to 52 per cent of its energy – up from the current 32 per cent – from renewable sources and reduce greenhouse gas emissions by 45.5 per cent by 2030
Earlier this year, Xlinks completed an early development funding round that included a $30.7m investment from Abu Dhabi National Energy Company (Taqa) and $6.23m from London-headquartered Octopus Energy Group.
The UK-based startup is expected to seek interest from original equipment manufacturers and construction partners soon. This will be followed by seeking interest from financial advisers for the project.
Low-carbon molecules
Morocco aims to source up to 52 per cent of its energy – up from the current 32 per cent – from renewable sources and reduce greenhouse gas emissions by 45.5 per cent by 2030.
Thanks to the country’s strategic location and favourable legislative framework, this ambition is drawing investors focused on green hydrogen and derivatives production.
In April, a team led by China Energy International Construction Group signed a memorandum of cooperation to develop a green hydrogen project in a coastal area in southern Morocco.
The planned project involves constructing an integrated green hydrogen-based ammonia production facility. It will require a solar PV power generation plant with a capacity of 2GW and a wind power plant with a capacity of 4GW.
These plants will supply power to an electrolysis plant that can produce 320,000 tonnes of green hydrogen annually, which will then be processed to produce 1.4 million tonnes of green ammonia annually.
Energy China International Construction Group has partnered with Saudi Arabia’s Ajlan & Brothers Company and the local firm Gaia Energy Company for the project.
Amun project
It is the second high-profile green hydrogen project announced for the North African country since April 2022, when Serbia-headquartered renewables developer and investor CWP Global appointed US firm Bechtel to support developing large-scale green hydrogen and ammonia facilities in the country.
The Amun green hydrogen project, which CWP Global plans to develop in Morocco, is understood to require 15GW of renewable energy and has an estimated budget of between $18bn and $20bn.
Along with these projects – which could take several years to implement – several green hydrogen pilot projects are also under way in Morocco.
Africa-focused transitional energy group Chariot, the Mohammed VI Polytechnic University and UK-based hydrogen electrolyser developer Oort Energy are planning several small projects using a polymer electrolyte membrane electrolyser system patented by Oort.
The three parties will run initial proof of concept projects while evaluating the feasibility of implementing large-scale green hydrogen and ammonia production.
One of the pilot projects is intended to be hosted at the research and development unit at state-owned fertiliser producer OCP Group’s facilities in Jorf Lasfar.
US-headquartered Verde Hydrogen also plans to develop and commission a 2MW green hydrogen electrolyser plant project in Morocco, which it expects to complete next year.
Electric vehicle components
Recent developments also point to Morocco potentially becoming a global hotspot for the electric vehicles supply chain.
In July this year, China’s Guangzhou Tinci Materials Technology announced plans to build a lithium-ion battery materials plant in the country. The project capitalises on Morocco’s ample phosphorite ore resources.
The firm’s Singapore unit is expected to invest as much as $280m to set up a project company in the North African country to produce lithium-ion battery materials that can be exported to Europe.
In late May, the Moroccan government and Chinese-European company Gotion High-Tech also signed a preliminary agreement to establish a factory to produce electric car batteries and energy storage systems in the country.
The project is estimated to cost MD65bn ($6.3bn). The planned facility will have the potential to “create a comprehensive battery production solution” with a capacity of 100GW a year.
Morocco’s minister-delegate in charge of investment, convergence and evaluation of public policies, Mohcine Jazouli, said the factory “will not only contribute to Morocco’s renewable energy and electric transport sector, but also solidify its reputation as an automotive industry powerhouse”.
Traditional energy
Meanwhile, along with its intense drive towards clean energy, Rabat is also making progress on traditional energy projects. The National Office of Electricity & Drinking Water (Onee) last awarded a thermal power plant deal in 2017. So it was a surprise when Onee recently tendered a five-year contract to build and operate an open-cycle 900MW thermal power plant in the country.
To be located along the M18 station point of the Maghreb-to-Europe gas pipeline, the proposed power generation plant will use dual-fuel gas turbines, with diesel fuel as a backup. Onee expects to receive bids for the contract by 5 September.
In addition, the procurement process is under way for a major seawater reverse osmosis (SWRO) desalination plant in Grand Casablanca, which has a design capacity of 548,000 cubic metres a day.
The build-operate-transfer contract is for 30 years, including a three-year construction period and 27 years of operation and management.
Making amends
To its credit, however, Morocco’s sustainable campaign has extended to other sectors that have traditionally used carbon-intensive processes and technologies.
The Washington-based International Finance Corporation (IFC) and OCP Group recently signed a €100m ($111m) green loan to build four solar plants to power OCP’s Morocco operations.
The four solar plants, with a combined capacity of 202MW, will be located in the mining towns of Benguerir and Khouribga, home to Morocco’s largest phosphate reserves.
As captive power plants, they will supply clean energy directly to OCP’s operations. The project is part of OCP’s $13bn green investment programme, which aims to increase its green fertiliser production and transition its operations to green energy by 2030.
More on Libya and Tunisia’s power and water sectors:
> Libya awards $1.3bn power plant contract
> Italy and Tunisia start $1bn Elmed prequalifications
> Acciona and Swicorp to develop 75MW wind project
> Suez signs $221m Tunisia wastewater PPP deal
> Tunisia tenders 1GW of solar IPP contracts
Libya and Tunisia
Earlier this year, the state-owned General Electricity Company of Libya (Gecol) awarded a joint venture of Qatar-based construction company Urbacon for Trading & Contracting and Egypt’s ElSewedy Electric an engineering, procurement and construction contract for a 1,044MW gas-fired power plant in Libya.
The contract is valued at €1.19bn ($1.29bn). The project is expected to be completed in 26 months and comprises six gas turbines from Germany’s Siemens Energy. The emergency power plant project is located in Zliten.
The power plant is expected to help address the endemic electricity shortage in the country. However, it does little to reduce Libya’s carbon emissions. At under 10MW, the country has the lowest renewable energy installed capacity in the Middle East and North Africa (Mena) region, against a total capacity of 11,000MW as of 2021, according to International Renewable Energy Agency data.
Tunisia, where renewable sources account for at least 8 per cent of its power generation capacity, has also made minor progress over the past few months.
A team of Spain’s Acciona and Saudi investment group Swicorp have partnered to develop a 75MW wind farm in Chenini in Tunisia’s Tataouine governorate.
The Spanish-Saudi team is understood to have agreed to the technical and financial terms of the project, as well as the land lease for installing 14 wind turbines in Djebel Dahar, located 80 kilometres from Djerba.
Each wind turbine will have a capacity of 6MW. The project will require an estimated investment of TD500m ($164m).
Tunisia’s wind potential is estimated at 8,000MW, according to its wind atlas and a study published in 2021 by the German international cooperation agency Giz.
In January this year, the African Development Bank Group approved a $27m and €10m ($10.67m) loan package to co-finance the construction of a 100MW solar power plant in Kairouan, Tunisia.
The approval covers $10m and another €10m from the bank, and a $17m concessional financing from the Sustainable Energy Fund for Africa, a special multi-donor fund managed by the bank.
Additional financing will come from the IFC, the World Bank Group and the Clean Technology Fund (CTF).
The 100MW Kairouan project was part of the first round of solar schemes under Tunisia’s concession regime, launched through an international tender by the Ministry of Industry, SMEs & Cooperatives in 2018.
A consortium formed by Dubai-headquartered Amea Power and TBEA Xinjiang New Energy Company won the contract to develop the scheme in December 2019.
The project is located in El-Metbassta, in the Kairouan North region, about 150km south of the capital, Tunis.
More on Algeria’s power and water sectors:
> Sonatrach seeks solar PV consultants
> Cosider tenders desalination contract
> Sonelgaz tenders 2GW solar schemes
> Wetico wins Algeria water desalination contracts
Algeria
Despite a highly tentative approach to adopting low-carbon energy, there are some promising projects in Algeria.
In March, state-owned utility Sonelgaz invited companies to bid for the contract to build 15 solar plants in the country with a combined capacity of 2,000MW.
The solar projects will be built in 11 locations across the North African state.
The locations and capacities of the proposed solar power plants include:
- Bechar (Abadla): 80MW
- Bechar (Kenadsa): 120MW
- Msila (Batmete): 220MW
- Bordj Bou Arreridj (Ras al-Oued): 80MW
- Batna (Merouana): 80MW
- Laghouat: 200MW
- Ghardaia (Guerrara): 80MW
- Tiaret (Frenda): 80MW
- El-Oued (Nakhla): 200MW
- El-Oued (Taleb Larbi): 80MW
- Touggort: 130MW
- Mghaier: 220MW
- Biskra (Leghrous): 200MW
- Biskra (Tolga): 80MW
- Biskra (Khenguet Sidi Nadji): 150MW
In December 2022, Algeria’s Energy Transition & Renewable Energies Ministry (Shaems) also launched a tender to deploy 1,000MW of solar capacity. However, the status of the tender is unclear as of mid-2023.
Exclusive from Meed
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Egypt places fuel order for El-Dabaa nuclear plant21 November 2025
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Iraq unveils 20-year plan to add 57GW of power capacity21 November 2025
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Kuwait upstream project to be completed in 202721 November 2025
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Regional rail construction surges ahead21 November 2025
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Middle East becomes a hub as rail networks mature21 November 2025
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Egypt places fuel order for El-Dabaa nuclear plant21 November 2025
Egypt’s government has signed a nuclear fuel purchase order for the first unit of the El-Dabaa nuclear power plant, which is expected to be operational in 2026.
The fuel order was signed with Russia’s State Atomic Energy Corporation (Rosatom).
The signing ceremony was attended by Egypt’s Prime Minister Mostafa Madbouli. It included senior officials from Egypt’s Ministry of Electricity & Renewable Energy and the Nuclear Power Plants Authority (NPPA).
The agreement coincided with the installation of the VVER-1200 Generation III+ reactor pressure vessel for the project’s first unit.
The El-Dabaa nuclear power plant will have four units, each capable of generating 1,200MW of electricity. The VVER-1200 Generation III+ reactor model has been selected for all four units.
Egypt and Russia signed the initial inter-governmental agreement for the North African state’s first nuclear facility in November 2015.
Rosatom, the project’s main contractor, announced that it started the production of electrical components in Saint Petersburg for a reactor vessel for the plant in June 2022.
The two countries also agreed on broader cooperation covering nuclear technology, medical radioisotopes, technical applications such as 3D printing, and communications.
El-Dabaa project status
In September 2023, the Egyptian Nuclear & Radiological Regulation Authority (ENRRA) granted a construction permit for the plant’s fourth reactor. ENRRA granted the construction permit for unit three in March that year and units one and two in June 2022 and October 2022, respectively.
In November 2022, South Korea’s Doosan Enerbility signed a contract valued at $1.2bn with state-owned South Korea Hydro & Nuclear Power (KHNP), a subsidiary of Korea Electric Power Corporation (Kepco), for the project.
Rosatom subsidiary ASE earlier appointed KHNP as the single supplier for constructing the turbine islands.
The simultaneous installation of the reactor pressure vessel and fuel order indicates that Unit 1 has transitioned from civil construction into the core mechanical and systems-installation phase.
The latest advancements align with Egypt’s annual Nuclear Energy Day, observed on 19 November to mark the 2015 agreement that initiated the El-Dabaa project.
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Iraq unveils 20-year plan to add 57GW of power capacity21 November 2025
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Iraq has unveiled a 20-year plan to add 57GW of new power capacity in partnership with Germany’s Siemens Energy and US-based GE Vernova.
The programme aims to expand the electricity sector through new gas-fired plants, renewable energy schemes and long-term maintenance plans for existing plants.
Prime Minister Mohammed Shia Al-Sudani announced the plan on 19 November as he launched a project to build the 1,400MW Al-Youssifiyah thermal power plant under a build-own-operate (BOO) model.
Located about 30 kilometres from Baghdad, there have been previous attempts to restore the Al-Youssifiyah plant, which has been stalled since it was destroyed during the Gulf War.
In 2015, the project was cancelled amid civil unrest in the region.
No official timeline was given for the latest “implementation phase” of the project.
In a statement, however, the prime minister said the country will move towards an alternative financial model for electricity investments.
“We have adopted an investment financial model that addresses the injustices of previous phase contracts to provide an attractive environment for investment,” he said.
“We have worked to reduce the tariff rate and provide up to a 43% [reduction] from previous contracts while preserving public funds,” he added.
MEED understands that these savings refer to reduced generation costs under a model supported by long-term power purchase agreements (PPAs).
Al-Sudani has also directed the ministry to calculate the actual cost of producing electricity and recover it through improved billing and collection.
Iraq’s government has also set a target of adding more than 7GW of solar capacity by 2030 to reduce reliance on oil- and gas-fired generation. The country continues to face chronic electricity shortages, especially during the summer months, as it aims to meet 24-hour demand.
In August, the government approved five major power generation projects, with a combined capacity exceeding 10,000MW.
The projects include three major independent power producer (IPP) combined-cycle plants at Al-Faw, Abu Ghraib and Kirkuk, totalling 7,500MW.
The Iraqi cabinet also approved the development of two thermal power plants, one in Najaf and the other in Youssifiyah, with output capacities of 1,500MW and 1,800MW, respectively.
Furthermore, in September, Iraq started power generation at its first utility-scale solar plant.
The first phase of the 300MW Karbala solar power plant has started generating 22MW, with plans to increase to the full capacity of 300MW by the end of the year.
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Kuwait upstream project to be completed in 202721 November 2025

State-owned upstream operator Kuwait Oil Company (KOC) is expecting its project to install depletion compression systems and sulphur recovery units (SRUs) to be completed in the middle of 2027, according to industry sources.
KOC signed a contract with Kuwait-based engineering contractor Spetco earlier this year, and construction work is currently ongoing.
In November last year, Spetco submitted a bid of KD126.5m ($412m), beating bids from companies based in China, Saudi Arabia and India.
The project involves installing new units at the facilities known as Early Production Facility 50 (EPF-50) and Jurassic Production Facility 3 (JPF-3).
Tender documents were originally made available on 17 September 2023, with a bid deadline of 17 December that year.
Due to scope changes, the deadline was extended several times before bids were ultimately submitted ahead of a 15 October 2024 deadline.
Scope changes
In August last year, MEED reported that the estimated budget for the project had been increased from about $380m to approximately $460m due to scope changes.
The project uses the build-own-operate-transfer contract model.
EPF-50 and JPF-3 are sour hydrocarbons processing and handling facilities located in North Kuwait, designed to handle high-pressure (HP) sour hydrocarbons from several Jurassic wells in North Kuwait fields.
The project was launched to sustain production from the facilities by installing compression systems and SRUs.
Boosting compression
The contract’s original scope of work was divided into two parts, according to the tender documents that were released in September 2023.
The first part focused on installing a new medium-pressure (MP) compression system and SRU at EPF-50.
The second part focused on installing a new MP compression system and SRU at JPF-3.
The EPF-50 and JPF-3 facilities receive sour wet hydrocarbons reservoir fluids through flowline gathering networks and trunk lines.
Crude, gas and water are separated in a separation section that is currently receiving well fluid at 1,100 pounds a square inch gauge (psig), and the crude is stabilised for export after desalting.
The separation section consists of HP, MP and low-pressure (LP) separators in series. MP and LP gases are compressed to HP and combined with gas from HP separators.
The gas is then treated in gas sweetening and dehydration units before being exported via pipeline.
As the well fluid pressure depletes to MP, the combined feed from the inlet production headers and test header will be routed through a crude pre-heater to the new MP separator, which operates at about 425-450 psig.
The new compressors will compress the gas from MP to HP.
The EPF-50 facility can currently process 200 million standard cubic feet a day (scf/d) of gas, 50,000 barrels a day (b/d) of oil and 130 tonnes a day (t/d) of sulphur.
Originally, the upgrade project was expected to increase the volume of sulphur it can process to 270-310 t/d, but after the proposed changes to the scope, the capacity is now likely to be larger.
The JPF-3 facility can currently process 150 million scf/d of gas, 50,000 b/d of oil and 200 t/d of sulphur.
Originally, the planned upgrade was expected to increase the volume of gas that the facility can process to 240 million scf/d and the volume of sulphur to 440 t/d.
Due to the scope changes, the capacity of JPF-3 will now be increased by more than the volumes outlined in the original tender documents.
It is currently unclear by how much the capacities of EPF-50 and JPF-3 will increase under the new project scope.
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Regional rail construction surges ahead21 November 2025

> This package also includes: Middle East becomes a hub as rail networks mature
The GCC is at the centre of global rail construction activity after a decade of stop-start activity. Progress is being made on several large-scale rail schemes, providing renewed opportunities for international contractors to re-enter the market.
From the Qiddiya high-speed rail in Saudi Arabia to the planned expansion of Dubai’s metro network and the long-awaited revival of the GCC railway, a new wave of projects is shaping the region’s economic future.
Well-timed resurgenceAccording to data from regional projects tracker MEED Projects, the region boasts a pipeline of over $140bn-worth of railway schemes. Several factors are driving the renewed focus on major infrastructure.
Firstly, the region’s post-pandemic recovery has been underpinned by robust fiscal performance. Higher oil prices since 2022 have strengthened government balance sheets, enabling public investment in capital projects. Unlike in previous cycles, however, the current wave of spending is guided by a clearer vision rooted in diversification and long-term national development strategies.
Saudi Arabia’s Vision 2030, the UAE’s Centennial Plan 2071 and Oman’s Vision 2040 all emphasise connectivity, mobility and urban liveability as essential components of sustainable growth. Governments are therefore prioritising infrastructure that forms the backbone for tourism, logistics and housing development.
Secondly, project delivery capabilities have matured across the GCC. Local developers, contractors and authorities have gained experience delivering large and complex schemes such as the Dubai and Riyadh metros and Doha’s Fifa World Cup infrastructure. This has built confidence and the capacity to handle more ambitious undertakings.
Thirdly, global construction markets are shifting. With slowing growth in some developed economies, the GCC offers a stable, well-capitalised and politically supportive environment for investment.
In addition, international contractors, consultants and suppliers are facing shrinking margins elsewhere and are therefore refocusing on the Gulf region’s more promising project pipelines.
Strong prospects
Saudi Arabia has a pipeline of about $60bn-worth of rail projects. The long-discussed Saudi Land Bridge, connecting the Red Sea to the Gulf through Riyadh, is being prepared for procurement. Once complete, it will be a 1,300-kilometre (km) corridor from Jeddah to Dammam, transforming freight logistics and positioning Saudi Arabia as a regional trade hub.
The kingdom’s planned Qiddiya high-speed rail, meanwhile, will link King Salman International airport with Qiddiya entertainment city. It is part of Riyadh’s broader mobility masterplan and reflects the government’s intention to integrate developments with efficient public transport.
Riyadh also continues to expand its metro system, with Line 7 currently under tendering. This addition will extend the network’s reach to growing urban districts, further embedding mass transit into the daily life of the city.

Dubai is moving forward with the proposed Metro Gold Line
In the UAE, the momentum is just as strong. The ongoing Etihad Rail project is entering a new phase with the anticipated rollout of passenger services, connecting Abu Dhabi, Dubai and eventually the northern emirates. Freight operations are already under way, providing a backbone for industrial connectivity and cross-border trade. Plans for an Abu Dhabi–Dubai high-speed link are also progressing as bid evaluation continues for the main construction works.
Dubai is also going ahead with the proposed Metro Gold Line, which is designed to serve new growth corridors and improve connectivity to emerging districts.
Meanwhile, regional integration is back on the agenda with the GCC Railway, a long-delayed project that is finally gaining traction. Once realised, the network will connect Kuwait to Oman via Saudi Arabia, Bahrain, Qatar and the UAE, and governments are now actively coordinating to align standards, timelines and funding mechanisms.
The GCC offers a stable, well-capitalised and politically supportive environment for investment
Evolving delivery models
While public funding remains central to these initiatives, the GCC’s infrastructure landscape is also seeing a gradual shift towards new delivery and financing models.
Public-private partnerships (PPPs) are gaining traction, especially in Saudi Arabia. The proposed Qiddiya high-speed rail project is planned as a PPP, while several components of Hafeet Rail are being delivered through joint ventures providing financing arrangements.
This evolution comes with challenges, however. These frameworks must balance investor confidence with
public value, creating a need for clear risk allocation and transparent governance.The scale and ambition of the ongoing projects have not gone unnoticed internationally. Leading construction, engineering, and technology firms are either expanding or returning to the region after years of reduced activity.
Global rail specialists are competing for lucrative contracts in the region, while international consultancies are increasingly embedded in master planning and programme management roles.
The resurgence in project activity within the regional rail sector means firms will have many prospects to explore.
“The regional market has not been this exciting in a long, long time,” a senior executive from a major international rail firm told MEED.
“The market is shaping up for a golden era in rail and we will make sure that we give it our full attention.”
Another executive added: “This is primarily because of the resources available to governments now compared to in previous years, but more importantly [it is due to] the intent and will to make the projects happen.”
The GCC’s clear project pipeline and decisive execution are also a draw. Several rail projects in the region, such as Dubai Metro and Etihad Rail, have progressed from concept to implementation in relatively short timeframes.
Moreover, sustainability and innovation are becoming central to the GCC’s value proposition. Digital engineering, modular construction and low-carbon materials are being adopted more widely.
Developers are under pressure to meet environmental standards and align with global best practices. Commitment to these concerns, particularly through the UAE and Saudi Arabia’s net-zero goals, further enhances the region’s attractiveness to global investors.
Bringing together transport, tourism, logistics and sustainability is creating a practical approach to modern urban development
Challenges ahead
Despite the optimism, challenges remain. Cost pressures, supply chain disruptions and competition for skilled labour could slow progress or inflate project budgets.
The rapid pace of project launches also risks overstretching local capacity. Maintaining quality, timelines and financial discipline will require strong governance and careful coordination between various government agencies.
Long-term success depends on integrating infrastructure investment with broader social and economic goals. Transport systems must connect to affordable housing, job clusters and educational hubs, otherwise benefits remain limited.
That said, the GCC has shown remarkable adaptability. The lessons learned from previous cycles, especially the importance of phasing, master planning and stakeholder alignment, are helping to shape current strategies. Authorities are more selective, prioritising projects that yield clear economic multipliers and align with national visions.
The current wave of infrastructure expansion looks set to position the GCC region as a global rail construction hotspot. The projects will also define the physical and economic landscape of the region for decades to come.
By connecting cities, ports, and industries, these projects are reshaping the region’s economy. Bringing together transport, tourism, logistics and sustainability is creating a practical approach to modern urban development.
If the previous era of regional construction was defined by skyscrapers and luxury resorts, the coming decade will be defined by connectivity and integration. The GCC’s major projects today are not about scale alone, but also about building more connected economies that can sustain growth.
The renewed momentum also presents an opportunity for regional governments to amplify their national ambitions by building more diversified economies, reducing carbon emissions and enhancing liveability.
Main image: Haramain high-speed train in Jeddah, Saudi Arabia
Middle East becomes a hub as rail networks mature: MEED interviews Martin Vaujour, Alstom’s Africa, Middle East and Central Asia region presidenthttps://image.digitalinsightresearch.in/uploads/NewsArticle/15132273/main.gif -
Middle East becomes a hub as rail networks mature21 November 2025

The resurgence in investment in metro and intercity lines means the region is no longer an emerging market for the global rail industry. It is now an established hub with an expanding network of projects and, increasingly, the need for ongoing servicing, upgrades and new technologies.
“We are reaching a point where it is not just about building new lines. Customers are now understanding that it is not enough to just buy new trains – they also need long-term partnerships to service and maintain them efficiently,” says Martin Vaujour, Alstom’s Africa, Middle East and Central Asia region president.Alstom, which has supplied rolling stock and systems for major schemes in the region such as the Riyadh Metro, is now seeing growing demand for both new-build contracts and service agreements. “There are still lots of new investments,” he says, “but also growing activity in signalling projects, service projects and spare parts – areas that used to be small but are now taking off. That is a [source] of satisfaction for me, because those businesses are less risky, have better margins and create long-term relationships with customers.”
The change is an important development as the region becomes a mature market with diverse opportunities for the rail industry. “There was a time when countries would just buy materials with export credit,” says Vaujour. “Now, they are supporting local capacity to service and maintain trains. The mindset is evolving, and that is a very positive sign.”
Saudi expansion
Buoyed by the opening of Riyadh Metro at the end of 2024, Saudi Arabia remains an important market. “They are happy with the success [of Riyadh Metro],” says Vaujour. “There is extension work on the existing lines, new rolling stock being discussed and a potential Line 7 project. The network is expanding, and that is a great success story.”
The next wave of growth in Saudi Arabia includes the planned Qiddiya Express high-speed line, which has recently attracted expressions of interest.
“That project has been on our radar for some time,” says Vaujour. “It is under the umbrella of the Royal Commission for Riyadh City, which is very well organised and structured. That gives the project strength and credibility.”
The scheme is being developed as a public-private partnership, a model that Vaujour says fits Saudi Arabia’s stable economic environment. “Public-private partnerships (PPPs) take longer to put together because they are more complex to structure, but in countries like Saudi Arabia – stable and with the capacity to raise debt – why not?” he says.
“We are fine with PPPs. We have experience from France, the UK and Spain.”
While Alstom does not invest directly, it plays a key role in structuring deals. “We are facilitators and advisers,” says Vaujour.
“Our job is to accompany the customer, to adjust and iterate with them, and to help find the best solution. PPP is one of the tools in the box – not the simplest one, but one that works.”
The challenge in the market today is not a lack of opportunity, but deciding where to focus.
“Our main problem is not the market; it is how to be selective,” he says. “We have more than enough opportunities to ensure a nice trajectory of growth. The difficulty is to pick our battles and fight for the right ones.”
The challenge in the market today is not a lack of opportunity, but deciding where to focus
Shifting focus
In Africa and Central Asia, Alstom has long-term locomotive and commuter train partnerships that offer years of visibility. In the Gulf, by contrast, the model remains dominated by engineering, procurement and construction-style projects.
“It is more big projects, where civil contractors team up with us to deliver metros or airport people movers,” says Vaujour.
As regional urban transport networks become established, attention is turning to intercity and high-speed rail. “In the Gulf, the Abu Dhabi-Dubai high-speed project is probably the most advanced, while Qiddiya Express and upgrades to the Haramain line in Saudi Arabia could also accelerate momentum.”
Interest in high-speed connections between Riyadh, Doha and Kuwait is also growing, although such schemes will depend on electrification. “High-speed rail comes with electrification,” Vaujour notes. “And that means significant investment.”
In addition to new infrastructure, the rail sector is being reshaped by technology. Alstom is investing in clean traction systems, such as hydrogen and battery-powered trains, as well as in autonomous operations.
“Hydrogen and battery traction are progressing, but they are still in an early stage,” says Vaujour. “Diesel will continue to dominate freight for some time, because there is no clean technology yet that can deliver that level of power. But for passenger services, we are starting to see progress.”
Driverless trains are another major growth area. “Customers everywhere are interested, partly because it is increasingly hard to find drivers, and also because software drives more efficiently than humans. It is more energy-efficient and reduces wear and tear,” says Vaujour.
As the Middle East’s networks expand, upgrading existing infrastructure is becoming as important as building new lines. Signalling systems are central to this evolution. “You cannot just create new lines every year – it is too expensive,” says Vaujour. “Signalling allows you to double train frequency. It is what makes networks more efficient.”
The evolution reflects a wider transformation of the region’s rail sector. “The Middle East has become an established rail hub,” says Vaujour. “It is no longer just about building – it is about operating, maintaining and evolving.”
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