meed-logo

line1 line2 line3
SIGN IN / REGISTER

Neom becomes real-world building project

26 April 2023

This package on Neom also includes:

> SITE REPORT: World’s largest piling project shifts to The Line’s marina
> INTERVIEW: Neom to fix construction
> MOVIE SET: Neom advances plans to be leading movie destination
> TUNNELS: Neom tenders Delta Junction tunnel contracts
> OXAGON: Work to start for $1.5bn Oxagon wind turbine plant

 

The launch of Neom by Saudi Arabia’s Crown Prince Mohammed bin Salman at the Future Investment Initiative (IFI) in Riyadh in October 2017 challenged the world’s imagination and marked the beginning of Saudi Arabia’s gigaprojects era.

Strategically located close to neighbouring Jordan and Egypt, the 26,500 square-kilometre project is about the size of Belgium.  With a $500bn price tag, it quickly became known as the world’s largest construction project.

In the six years that followed, there has been a steady wave of announcements detailing the individual components of Neom. Each launch has been accompanied by marketing campaigns showcasing slick computer-generated imagery (CGI) of futuristic cities that aim to change how mankind will live. 

Unless working on these projects directly, Neom has been an abstract idea for most people. That started to change in January when Neom released a progress video of construction work on Sindalah Island, which is due to open its doors in 2024. Then in March, MEED visited Neom to witness the work progressing The Line, which is now the world’s largest piling project. 

The images of construction equipment toiling on site showed that after six years of planning, Neom is here.

In 2022, there were $13.6bn of contract awards at Neom, surpassed only by Saudi Arabia, the UAE and Qatar 

Awards soar 

As Neom morphs from a futuristic concept into a real-world building project, the construction industry has started to benefit from a sharp increase in contract awards, which by mid-April 2023 totalled $27bn. 

As construction activity ramps up, the data shows that Neom is no longer a single project offering tactical opportunities. It has become a strategic market in its own right. 

In 2022, there were $13.6bn of contract awards at Neom, surpassed only by Saudi Arabia, the UAE and Qatar. 

On a submarket level, the total value of contract awards exceeds the Saudi capital Riyadh, where there were $11bn of awards, and Dubai, which has traditionally been regarded as a hotbed of construction, with $9.3bn of awards in 2022. 

As tendering activity continues for major contracts, Neom’s prominence as a projects market will likely increase further. 

So far, four major components of Neom have been officially launched by Prince Mohammed. They are The Line, Trojena,
Oxagon and Sindalah Island. Meanwhile, work has also progressed on other projects that have yet to be officially launched with the full CGI treatment, such as Neom International airport and the Gulf of Aqaba.

The Line was the first to be launched in January 2021 as a 170-kilometre linear belt of hyper-connected, car-free communities. Then in July 2022, the designs of The Line’s mirrored buildings were revealed. They are 200 metres wide and 500 metres above sea level, running entirely on renewable energy. Once complete, The Line will accommodate 9 million residents.

Piling work has started for the first modules of buildings that make up The Line (click here for images of the site). Infrastructure work for The Spine, the infrastructure corridor parallel to The Line that includes the high-speed rail, is also advancing.

Floating city

The second major project launch was Oxagon industrial city in November 2021. It will be built around an integrated port and logistics hub, with its octagonal design minimising environmental impact and optimising land usage. The city will feature the world’s largest floating structure and be powered by 100 per cent clean energy. 

The first major area of construction for Oxagon is the expansion of the existing Duba port. A contract for the first phase of that project was awarded earlier this year and a second phase is being tendered.

In March 2022, Prince Mohammed announced Trojena. Located in the mountains, it has temperatures 10 degrees Celsius lower than other regional cities and offers the potential for snow-covered ski slopes.

Trojena dams face countdown to make it snow

Trojena received added impetus in October last year when it was selected to host the ninth Asian Winter Games in 2029. Trojena will have two competition clusters for the games: a snow cluster for sports, including alpine skiing, snowboarding and slalom; and an ice cluster for sports, including ice hockey, figure skating and curling. The games village will have 14 luxury hotels and be powered entirely by renewable energy.

Construction contracts covering major infrastructure elements such as three major dams are at the tendering stage. Procurement activity is also starting for major buildings such as The Vault, which is a 198-metre-high, 253-metre-wide and 864-metre-long building that will serve as the gateway to Trojena.

Sindalah, Neom’s first luxury island destination, was announced in December 2022 and construction work is advancing (see main image). Once complete, the island will feature a marina, hotels and a golf course. 

Delivering these projects is a major challenge for the construction sector. Resource scarcity is a key issue for all projects in the kingdom, with construction companies already struggling to meet the demand for their services and expertise. Neom, along with its owner, the Public Investment Fund (PIF), is taking steps to address these challenges by investing in local construction firms, attracting international companies, improving payment terms and adopting alternative procurement methods. Despite these efforts, the construction sector faces sustained pressure.

New economy

Neom is much more than just a collection of construction projects. While other projects in the region offer opportunities for the construction sector and associated asset management services such as facilities management and hotel operation, the scale of Neom means it is creating a new economy.

It is an economy that not only aims to support the development of nine sectors to achieve the goals outlined in Vision 2030, but also intends to transform the way those sectors operate. 

The industrial city Oxagon will play a key role. Neom plans to create an integrated port and logistics hub that will be home to seven innovative sectors: sustainable energy, autonomous mobility, water innovation, sustainable food production, health and wellbeing, technology and digital manufacturing, and modern methods of construction. 

The Neom green fuels project is key to Oxagon’s clean energy ambitions. The integrated facility will produce hydrogen to be synthesised into carbon-free ammonia. Full construction work began on the project earlier this year after it reached financial closure. The facility is expected to be commissioned in 2026.

Neom, US-based Air Products and Acwa Power each have a 33.3 per cent stake in Neom Green Hydrogen Company, the special project vehicle implementing the project.

Aviation is another major area of investment. Neom plans to start operating its own airline, Neom Airlines, at the end of 2024 from the existing Neom Bay airport before operating from Neom International – a greenfield development inland close to Tabuk at the end of The Line.

Neom will morph from a construction project into a full-fledged economy

International airport

Plans for the international airport are advancing. US firm Aecom has been awarded a contract to provide project management consultancy services, and a series of construction and supply contracts are due to be tendered this year.

Although not confirmed, it is understood 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 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. 

Another sector developing quickly is media. In April, Neom furthered its ambition to become the region’s leading TV and film production hub by opening more stages at its Media Village. The village now has four stages offering 12,000 sq m of production space. Six more stages are under development. Neom is also increasing its resort-style accommodation for cast and crew.

As well as gaining access to filming locations across Neom’s varied landscapes, companies using the facilities can enjoy Neom’s highly attractive production incentives, including cash rebates of over 40 per cent.

As these sectors and others advance, Neom will morph again from a construction project into a full-fledged economy. When launched in 2017, its GDP was projected to reach $100bn by 2030 – equivalent at the time to more than one-seventh of the kingdom’s GDP of $688bn. By focusing on nine high-value sectors, the Neom economy will be an affluent one. Its GDP per capita is projected to become the highest in the world.

Main image: Construction work is advancing on Sindalah Island, which is planned to open in early 2024. Credit: Neom

MEED's April 2023 special report on Saudi Arabia includes:

> GIGAPROJECTS: Saudi Arabia under project pressure
> ECONOMY: Riyadh steps up the Vision 2030 tempo
> CONSTRUCTION: Saudi construction project ramp-up accelerates
> UPSTREAM: Aramco slated to escalate upstream spending
> DOWNSTREAM: Petchems ambitions define Saudi downstream
> POWER: Saudi Arabia reinvigorates power sector
> WATER: Saudi water begins next growth phase
> BANKING: Saudi banks bid to keep ahead of the pack

https://image.digitalinsightresearch.in/uploads/NewsArticle/10787833/main.gif
Colin Foreman

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Local firm executing Yasref tail gas treatment project

    14 April 2026

     

    Yanbu Aramco Sinopec Refining Company (Yasref) is overseeing progress on a key project to build a tail gas treatment unit (TGTU) at its crude refinery complex, located in Yanbu on the west coast of Saudi Arabia.

    Yasref is a joint venture in which Saudi Aramco owns the majority 62.5% stake and China Petroleum & Chemical Corporation (Sinopec) owns the other 37.5%. The Yasref refinery was commissioned in 2015 and has a crude oil refining capacity of 400,000 barrels a day (b/d).

    The aim of the project, which Yasref calls the tail gas synergy project, is to significantly reduce emissions of sulphur dioxide (SO₂) and hydrogen sulphide (H₂S) from its production complex. The 'synergy' comes from integrating primary treatment (such as the Claus process, which typically recovers about 95-97% of sulphur) with advanced secondary treatment in a TGTU, to achieve overall sulphur recovery of nearly 99.9%.

    Yasref awarded the main contract for the tail gas synergy project to Jeddah-based contractor Carlo Gavazzi Arabia earlier this year, according to information obtained by MEED Projects, with the contract estimated at $80m.

    The local branch of London-headquartered Berkeley Engineering Consultants is acting as the project’s main consultant, according to MEED Projects.

    The scope of work on Yasref’s tail gas synergy project includes the following:

    • Construction of downstream TGTU with catalytic hydrogenation reactor and amine absorber train
    • Modification of existing sulphur recovery units
    • Construction of acid gas removal units employing amine solvent systems
    • Construction of desulphurisation units including carbonyl sulphide hydrolysis
    • Construction of associated utilities and auxiliary infrastructure: thermal exchangers, power and steam supplies, flare knockout drums
    • Installation of safety and security systems hydrogen sulphide detection, overpressure relief, firewater deluge, access control, safety instrumented systems
    • Integration of emission monitoring and process control instrumentation.

    In April last year, Aramco, Sinopec and Yasref signed a venture framework agreement for a potential petrochemicals expansion of the Yasref refinery complex into a major integrated petrochemicals facility. The project would include a large-scale mixed-feed steam cracker with a capacity of 1.8 million tonnes a year (t/y) and a 1.5 million-t/y aromatics complex, along with associated downstream derivatives.

    MEED understands that the Yasref petrochemicals expansion project, which is also referred to as Yasref+, is part of Aramco’s $100bn liquids-to-chemicals programme.

    The central ambition of the strategic programme is to derive greater economic value from every barrel of crude produced in Saudi Arabia by converting 4 million b/d of Aramco’s oil production into high-value petrochemicals and chemicals feedstocks by 2030.

    ALSO READ: Saudi downstream projects market enters lean period
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16383830/main3043.jpg
    Indrajit Sen
  • Kuwait sets April deadline for $718m drainage tender

    14 April 2026

    Kuwait’s Ministry of Public Works has set a 21 April deadline for a major tender estimated to be worth about KD222m ($718m).

    The tender scope covers the construction of rainwater drainage networks across the residential areas of Sabah Al-Ahmad, South Sabah Al-Ahmad, Al-Khairan and Al-Wafra.

    The Ministry of Public Works floated the tender on 22 March.

    According to regional projects tracker MEED Projects, the works include the construction of a major concrete sewer, three collection basins and extensive stormwater drainage basins.

    Rainwater collection tanks will be connected through an independent network, with outlets to the sea via the Nuwaiseeb exit to manage overflow.

    The infrastructure will also filter pollutants such as oils, minerals and sediments to protect water quality and support environmental sustainability.

    The project aims to reduce surface runoff, prevent street and urban flooding, and improve groundwater recharge.

    UK analytics firm GlobalData expects Kuwait’s construction industry to grow by 5.1% in 2026-29, supported by government investment in the oil and gas sector aimed at raising production, as well as investment in the infrastructure sector.

    In the short term, growth will be boosted by planned expenditure under the 2025-26 budget, which was approved in March 2025.

    The construction industry in Kuwait is expected to record an annual average growth rate of 4.9% in 2026-29, supported by investments in renewable energy, transport, and oil and gas projects.

    READ THE APRIL 2026 MEED BUSINESS REVIEW – click here to view PDF

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16383203/main.jpg
    Yasir Iqbal
  • Local firm makes hydrocarbon discovery in Oman’s Block 7

    14 April 2026

    Omani oil and gas exploration and production company Masar Petroleum has announced a discovery in the Hasirah Ridge in the sultanate’s Block 7.

    Masar Petroleum was the inaugural operator to appraise and produce hydrocarbons from the Hasirah reservoir in Block 7 in 2017.

    Building on that experience, Masar Petroleum has now successfully drilled a new exploration well south of its existing discoveries, validating the concept of the Hasirah Ridge — a geological trend 5 kilometres wide and 30km long mapped across Block 7 using 2D seismic data.

    This discovery represents the first step towards unlocking the Ridge’s prospective resource base of 100 million to 380 million barrels, Masar Petroleum said in a statement.

    Following this discovery, a planned 3D seismic survey and exploration and appraisal programme is expected to advance the development of the new resources by the end of 2028.

    First production from this field is expected to come on stream during the last quarter of this year.

    Masar Petroleum plans to rapidly advance appraisal and development opportunities across Block 7.

    “Masar is a proud Omani E&P company that has delivered significant value through a continuous and focused effort on unlocking our potential,” Abdulsattar AlMurshidi, CEO of Masar Petroleum, said.

    ALSO READ: Oman offers five hydrocarbon exploration blocks in new bidding round
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16383075/main2121.jpg
    Indrajit Sen
  • Bidders get more time for Saudi water transmission projects

    14 April 2026

     

    Saudi Arabia’s Water Transmission Company (WTCO) has extended the bid submission deadlines for engineering, procurement and construction (EPC) contracts for two major independent water transmission system projects.

    The Jubail-Buraidah and Ras Mohaisen-Baha-Mecca transmission projects were first tendered last September under the public-private partnership model.

    The deadlines for qualified contractors to submit technical and financial bids had initially been extended to March. 

    The new bid submission deadline for the Jubail-Buraidah project is 30 April.

    Scheduled to begin construction in 2027, the scheme comprises an approximately 348-kilometre-long greenfield water transmission system with a capacity of 840,650 cubic metres a day (cm/d), delivering water from the Ashmasiah reservoirs to cities and towns in Al-Qassim province.

    The project is large by WTCO standards. The company’s second phase of the Khobar-Hofuf system, completed in 2024, was 140km in length, with a capacity exceeding 530,000 cm/d. 

    Ras Mohaisen-Baha-Mecca

    For the Ras Mohaisen-Baha-Mecca water transmission system project, the new bid submission deadline is 7 May.

    The project involves constructing an approximately 325km-long greenfield independent water transmission system with a capacity of 542,000 cm/d, delivering water from Ras Mohaisen to the Adham and Aradhiyah regions.

    Prequalification for both projects closed on 15 January.

    It is understood that local firms Alkhorayef Water & Power Technologies and Mutlaq Al-Ghowairi Contracting Company (MGC) are among those qualified to bid for the Ras Mohaisen contract.

    MGC secured the EPC contract for an even larger independent water transmission pipeline project in June last year.

    The project, also linking Jubail and Buraidah, spans 587km and carries 650,000 cm/d.

    According to regional project tracker MEED Projects, construction works recently commenced on the project, which is estimated to cost about SR8.5bn ($2.2bn).

    WTCO is also planning to tender a contract for phase two of the Ras Mohaisen water transmission system project. This includes laying water transmission pipelines 408km in length with a capacity of 400,000 cm/d. This project is estimated to cost around $600m.

    It is understood that the main contract tender will be issued in 2027.

    READ THE APRIL 2026 MEED BUSINESS REVIEW – click here to view PDF

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16383056/main.jpg
    Mark Dowdall
  • Saudi firm wins $64.2m steel pipe orders from Aramco

    14 April 2026

    Saudi Arabia-based Arabian Pipes Company has announced it has won orders from Saudi Aramco to supply steel pipes, totalling SR241m ($64.2m).

    Under the terms of the contracts, Arabian Pipes Company will supply steel pipes over contract durations of nine months and 11 months, commencing from the date of signing.

    “These contract awards reinforce Arabian Pipes Company’s strong position as a key supplier to the kingdom’s energy sector and highlight its continued commitment to supporting major oil and gas infrastructure projects in Saudi Arabia,” the company said in a filing with the Saudi Exchange (Tadawul), where its shares trade.

    The company added that the orders will contribute positively to its financial performance over the contract period.

    Arabian Pipes Company last secured a contract from Aramco in August 2024, when it won an eleven-month steel pipe supply order worth approximately $28.53m.

    Prior to that, in July 2024, the company won a contract worth SR293m ($78.1m) to supply steel pipes for the second expansion phase of Aramco’s Jafurah unconventional gas development. That contract had a duration of 10 months.

    The order was placed as a subcontract by Denys Arabia, the main contractor performing engineering, procurement and construction works on one of the Jafurah second expansion phase project packages.

    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia
    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16382513/main2830.jpg
    Indrajit Sen