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Saudi Arabia seeks Taif airport PPP interest

5 December 2024

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Saudi Arabia’s Matarat Holding, through the National Centre for Privatisation & PPP (NCP), has invited firms to express interest in bidding for a contract to develop and operate a new international airport in Taif in the country’s Mecca province.

The new Taif International airport will be located 21 kilometres southeast of the existing Taif airport, with a capacity to accommodate 2.5 million passengers by 2030.

Matarat and NCP expect to receive expressions of interest from companies by 10 January 2025.

The invitation is open to interested private sector entities via a public-private partnership (PPP) model under a 30-year build-transfer-operate (BTO) contract, including the construction period.

The BTO project scope includes the new airport. The proposed design features a runway with a full-length parallel taxiway connecting to a single commercial apron.

The scope includes facility buildings, utility networks, car parks and access roads, as well as provisions for additional expansions to meet future subsystem requirements.

The new Taif International airport is expected to meet the projected increase in demand by 2055 and contribute to the economic development of Taif city and its surrounding areas, in line with the kingdom’s National Aviation Strategy.

It is also expected to meet the needs of Umrah pilgrims as a viable alternative within the region’s multi-airport system, which includes King Abdulaziz Airport in Jeddah, Prince Mohammed Bin Abdulaziz Airport in Medina and Prince Abdulmohsen Bin Abdulaziz Airport in Yanbu.

Other airport PPPs

Three other airports, in addition to the Taif International project, comprise the first stage of Saudi Arabia’s latest plan to modernise and privatise its international and domestic airports.

The other planned airport PPP schemes are in Abha, Hail and Qassim.

Matarat and NCP recently prequalified three consortiums and one company that can bid for a contract to develop and operate a new passenger terminal building and related facilities at Abha International airport.

The companies that have been prequalified to bid for the Abha airport PPP contract are:

  • GMR Airports (India)
  • Mada TAV: Mada International Holding (local) / TAV Airports Holding
  • Touwalk Alliance: Skilled Engineers Contracting (local) / Limak Insaat (Turkiye) / Incheon International Airport Corporation (South Korea) / Dar Al-Handasah Consultants (Shair & Partners, Lebanon) /  Obermeyer Middle East (Germany/ Abu Dhabi)
  • VI Asyad DAA: Vision International Investment Company (local) / Asyad Holding (local) / DAA International (Ireland)

Located in Asir province, the first phase of the Abha International airport PPP project is set for completion in 2028. It will increase the airport terminal area from 10,500 square metres (sq m) to 65,000 sq m. 

The contract scope includes a new rapid-exit taxiway on the current runway, a new apron to serve the new terminal, access roads to the new terminal building and a new car park area.

The scope also includes support facilities such as an electrical substation expansion and a new sewage treatment plant.

    The transaction advisory team for the client on the Abha airport PPP scheme comprises UK-headquartered Deloitte and Ashurst as financial and legal advisers, respectively, and ALG as technical adviser.

    Previous tenders

    The Taif, Hail and Qassim airport schemes were previously tendered and awarded as PPP projects using a BTO model.

    Saudi Arabia’s General Authority of Civil Aviation (Gaca) awarded the contracts to develop four airport PPP projects to two separate consortiums in 2017.

    A team of Tukey’s TAV Airports and the local Al-Rajhi Holding Group won the 30-year concession agreement to build, transfer and operate airport passenger terminals in Yanbu, Qassim and Hail.

    A second team, comprising Lebanon’s Consolidated Contractors Company, Germany’s Munich Airport International and local firm Asyad Group, won the BTO contract to develop Taif International airport.

    However, these projects stalled following the restructuring of the kingdom’s aviation sector.

    The latest plan entails transferring the ownership of 35 airports from Gaca to the Public Investment Fund (PIF).

    This is in line with transforming Gaca, which previously managed and operated the airports, into a legislator and regulator.

    The construction, operation and management work for the airports is being referred to Matarat, prior to being transferred to PIF.

    Matarat Holding Company is a subsidiary of Gaca. 

    Saudi Arabia has already privatised airports, including the $1.2bn Prince Mohammed Bin Abdulaziz International airport in Medina, which was developed as a PPP and opened in 2015.

    Related read: Saudi Arabia to issue third national carrier licence

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    Jennifer Aguinaldo

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