meed-logo

line1 line2 line3
SIGN IN / REGISTER

Soaring data demand drives boom

29 May 2023

 

> This package also includes: Region plans vital big grid connections
Power links carry economic, climate and political significance

The world’s longest submarine communications cable system reached its first two landing sites in Jeddah and Yanbu in Saudi Arabia in early May.

The 45,000-kilometre 2Africa cable system will arrive at its third landing site in Duba, Saudi Arabia, later this year and its fourth site in Al-Khobar in 2024. 2Africa will take the number of submarine cable system landing sites in Saudi Arabia to 27, with 13 located in the Red Sea port city of Jeddah.

An expansion in submarine cable landing sites supports the kingdom’s ambition – and that of the broader Middle East and North Africa (Mena) region – to become a global digital hub.

The submarine cables enable high-speed, low-latency connectivity between regions and facilitate the transfer of vast amounts of data across national borders. They can help to unlock significant economic potential arising from products and services enabled by information technology (IT) and data connectivity, including e-commerce, machine learning, Big Data and artificial intelligence (AI).


Source: Telegeography

This will be supported by the strategic geographical advantage of Middle East countries to connect the digital traffic and services between Asia, Africa and Europe – a development that is being mirrored by the planned long-distance power interconnectors across the region.

“Subsea cables provide faster and more dependable internet access than older methods such as satellite or microwave communications,” says Ziad Samaha, an executive with UAE-based Khazna Data Centres.

Driving investment

Kamel al-Tawil, managing director for Mena at US-headquartered firm Equinix, also notes that the increased connectivity provided by subsea cables “can help attract more international businesses to the region, driving economic growth and creating new opportunities for the data centre and wider IT industry”.

The largest telecommunications companies and their data subsidiaries have been building data centres to support their operations and clients’ requirements in recent years.

The explosive growth in data and the advent of cloud services – or renting software applications as opposed to buying licences to use them – in addition to general uncertainty about regulations governing data sovereignty in most jurisdictions, have propelled the region into a data centre-building boom.  

This began when US-based Amazon Web Services (AWS) established its first availability zone or data centre cluster in Bahrain in 2019. AWS has since built availability zones in the UAE, with further plans to invest $5bn over 15 years to enhance its data infrastructure in the country.

The scale of Saudi Arabia’s ambition to become a digital hub has been met with commitments to build data infrastructure within the kingdom. Chinese telecoms giant Huawei is investing $400m to build a cloud services infrastructure, while Silicon Valley giants Microsoft and Oracle have committed to investing $2.1bn and $1.5bn, respectively, in the kingdom.

“The demand for data centre services in the region is growing rapidly, and continued investment in digital infrastructure will be critical to supporting the region’s long-term growth and development,” says Al-Tawil.

Regionally headquartered firms are determined to corner a significant piece of the data centre market, which is forecast to grow by a compounded average of 7.59 per cent annually between 2022 and 2028, thanks to strong demand from industries such as finance, healthcare and telecommunications.

Emboldened by its merger with Injazat Data Systems and the backing of both Abu Dhabi-headquartered G42 and its shareholder Mubadala Investment Company, Khazna Data Centre Services is expanding its UAE data centre capacity.

It has also announced a plan to enter the Egyptian market with a planned $250m investment in a 25MW data centre facility at the Maadi Technology Park in Cairo. A further phase could see Khazna doubling the facility’s capacity to 50MW, enabling it to achieve hyperscale status, comparable to the largest data centre facilities in the region and around the globe.

The explosive growth in data has propelled the region into a data centre building boom

Digital transformation

With a young and tech-savvy population, rising internet penetration and greater adoption of cloud-based technologies, Middle East governments have also been actively promoting digital transformation.

This has led to the development of large data centres that provide connectivity and data exchange services for businesses and organisations worldwide.

“Given this growth trajectory, the region is projected to require ongoing investment in data centre capacity,” says Samaha.

The specific amount of necessary investment will be contingent on various factors, including the rate of technological innovation, the level of demand from businesses and consumers, and the regulatory environment.

AI-powered data

“The rapid growth of data generation fuelled by AI has transformed how data is stored, processed, managed and transferred while increasing the demand for computing power across cloud and edge data centres,” says Samaha.

Equinix’s Al-Tawil agrees, noting that AI technologies, particularly machine learning, rely on large volumes of data for training models. His company is investing in data centres as well as in a dedicated fibre optic gateway connecting two facilities in Muscat and Dubai.

“As the adoption of AI continues to accelerate, there will be a surge in demand for data storage and processing. This growth in data generation … will require enterprises to invest in scalable and high-performance infrastructure to meet these demands effectively,” the executive concludes.

Region plans vital big grid connections

https://image.digitalinsightresearch.in/uploads/NewsArticle/10848743/main1605.jpg
Jennifer Aguinaldo

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

Click here to register
Exclusive from Meed
Related Articles
  • Contractor appointed for Abu Dhabi Riviera residences

    1 July 2026

     

    Dubai-based real estate developer Mered has appointed Turkiye’s Sera Group as the main contractor for its Riviera Residences project on Al-Reem Island in Abu Dhabi.

    The development will comprise more than 400 one- to three-bedroom apartments and 11 villas.

    Lebanese engineering firm Dar Al-Handasah is the project consultant, while Switzerland’s Herzog & de Meuron is the architect.

    The enabling works are being carried out by local contractor NSCC International.

    Mered and Sera Group are also working together on the Iconic Tower project in Dubai Internet City, where the developer awarded the main contract in December 2024.

    The 67-storey tower is being built on a site covering about 6,368 square metres.

    Local firm Mirage is the project consultant, while Singapore-based Hirsch Bedner Associates is the project architect.

    Dubai-based Chawla Architectural & Consulting Engineers is the architect of record, and Omnium International is the quantity surveyor.

    The foundation works were carried out by local firm Dutch Foundations.

    Mered’s latest contract awards in the UAE market come amid heightened real estate and construction activity, with schemes worth more than $323bn at the execution or planning stages, according to UK-based analytics firm GlobalData.

    GlobalData forecasts that output from the UAE’s residential construction sector will grow by 3% in real terms in 2026-29, supported by infrastructure, energy and utilities developments, as well as residential construction projects.

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

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17509888/main.jpg
    Yasir Iqbal
  • Aramco extends deadline for Ras Tanura refinery gas pipeline

    1 July 2026

     

    Saudi Aramco has granted contractors more time to prepare bids for a tender to replace a pipeline in the Gas Line Abqaiq–Ras Tanura (GART) transmission network.

    The GART grid transports associated gas and natural gas liquids (NGL) from the Abqaiq oil processing complex as feedstock, northwards to the Ras Tanura refinery in Saudi Arabia’s Eastern Province.

    The aim of the project is to replace the GART-22 pipeline that connects the Juaymah export terminal on the Gulf coast in the Eastern Province to the Ras Tanura refinery, to ensure reliable fuel gas supply and meet ongoing demand.

    The basic scope of work for the project is to install a new 24-inch pipeline system to replace the GART-22 line and the abandoned GART-24 line. It will cover a distance of 18 kilometres between Juaymah and the Ras Tanura terminal.

    The scope also includes the installation of associated scraper trap facilities (launcher and receiver), pressure control valves, motor-operated valves and gas detection and sampling systems.

    Aramco issued the tender for the project in May, setting an initial deadline of 30 June for contractors to submit proposals, MEED previously reported.

    The Saudi energy giant has now extended that deadline until 10 July, according to sources.

    The following contractors, among others, are understood to be bidding for the project:

    • ACE Pipeline Arabia
    • Combined Group Contracting Company
    • Gas Arabian Services Company
    • Max Streicher Saudi Arabia
    • National Basics Company
    • Saad Ali Alessa Group
    • Sicim
    • Sinopec Engineering Group Saudi
    • Tecton Engineering & Construction
    Ras Tanura refinery complex

    The Ras Tanura refinery is the oldest, and one of the largest, crude oil refineries in Saudi Arabia. The complex has a refining capacity of 550,000 barrels a day (b/d).

    The facility also has a 305,000 b/d NGL processing facility, a 960,000 b/d crude stabilisation facility, combined steam and gas turbine electrical power generation plants with a summer capacity of 145MW and a winter capacity of 158MW, and a combined 150-pound and 600-pound steam capacity of 6,217 million pounds an hour.

    It has 75 crude oil and products storage tanks with a combined capacity of 5.8 million barrels.

    The Ras Tanura refinery’s major facilities include a 325,000 b/d crude distillation unit, a 225,000 b/d gas condensate distillation unit, a 50,000 b/d hydrocracker and 107,000 b/d of catalytic reforming capacity.

    The facility is Aramco’s only refinery to contain a Visbreaker processing unit, which has a 60,000 b/d capacity.

    The Visbreaker reduces the quantity of residual oil produced in the distillation of crude oil and increases the yield of more valuable middle distillates, heating oil and diesel.

    The refinery complex also produces 17,000 b/d of asphalt, more than any other refinery in Saudi Arabia.

    Ras Tanura receives crude feedstock from the Abqaiq, Safaniya and Manifa oil field developments.

    Crude is typically transferred to Ras Tanura through a pipeline and can also be supplied by ship.

    Most of Ras Tanura’s production is transferred to the Dhahran bulk plant for domestic use, while some products are exported from the nearby Ras Tanura shipping terminal.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17508681/main4014.jpg
    Indrajit Sen
  • Siemens Energy to supply turbines for Oman IPP projects

    1 July 2026

    Germany’s Siemens Energy has announced it will supply power generation technology and long-term service agreements for the 2.6GW Misfah and Duqm independent power producer (IPP) projects in Oman.

    The scope includes the supply of six F-class gas turbines, six generators and 20-year long-term service agreements for the equipment.

    The combined-cycle gas-fired plants will add almost 20% to the sultanate’s electricity generation capacity. They are expected to provide electricity to more than two million people.

    Oman’s Nama Power & Water Procurement (Nama PWP) signed power-purchase agreements (PPAs) for the development and operation of the plants in January.

    The two combined-cycle gas turbine plants are being developed by a consortium comprising Korea Western Power (Kowepo), Qatar’s Nebras Power, the UAE’s Etihad Water & Electricity (EtihadWE) and Oman’s Bhawan Infrastructure Services.

    The Misfah IPP will be led by Nebras Power and located in Wilayat Bousher in Muscat Governorate, with a planned capacity of 1,600MW.

    The Duqm IPP will be led by Kowepo and located in Wilayat Duqm in Al-Wusta Governorate, with a capacity of 800MW.

    In May, MEED exclusively reported that a consortium of China-headquartered Shandong Electric Power Construction No. 3 Company (Sepco 3) and South Korea’s Doosan Enerbility had been appointed as the main contractor.

    The gas turbines will have hydrogen co-firing capability, providing flexibility to increase hydrogen use over time, Siemens said in a statement.

    The turbines will be manufactured at Siemens Energy’s facility in Berlin. The generators will be produced at the company’s plant in Muelheim, Germany.

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

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17506190/main.jpg
    Mark Dowdall
  • Qiddiya awards estimated $1bn racecourse deal

    1 July 2026

     

    Register for MEED’s 14-day trial access 

    Saudi gigaproject developer Qiddiya Investment Company (QIC) has awarded an estimated SR4.3bn ($1.1bn) contract for the construction of a racecourse at Qiddiya entertainment city, on the outskirts of Riyadh.

    The contract was awarded to Taj Dhabi, a local subsidiary of UAE-based Trojan Construction.

    The racecourse venue will cover 1.3 million square metres and accommodate 70,000 spectators.

    QIC issued the tender for the construction works in December last year, but formally announced the project only on 10 February. Contractors submitted their bids on 15 February, MEED previously reported.

    According to a statement published on QIC’s website: “The venue will include the region’s first straight-mile turf course, alongside a 2.2 kilometre (km) main turf track and a 2.4km inner dirt track.

    “A 21,000-seat grandstand will anchor the venue, with the ability to expand capacity to up to 70,000 guests through event overlays during major race days,” the statement added.

    A centrepiece of the venue will be a 110-metre central parade ring, located in the middle of the racecourse.

    The project also includes an equine hospital that will provide advanced veterinary services, including diagnostics, surgery, rehabilitation and emergency care for horses.

    The Qiddiya City horse racing venue is one of several major projects within the greater Qiddiya development. Other projects include an e-games arena, the Prince Mohammed Bin Salman Stadium, a motorsports track, a performing arts centre, the Dragon Ball and Six Flags theme parks, and Aquarabia.

    The project is a key part of Riyadh’s strategy to boost leisure tourism in the kingdom. According to GlobalData, leisure tourism in Saudi Arabia has experienced significant growth in recent years.

    GCC presses ahead with tourism projects

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

    Stress test for Gulf aviation; Mixed performance as country outlooks diverge in the Levant; GCC tourism sector pivots from crisis to recovery mode.

    Distributed to senior decision-makers in the region and around the world, the July 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/17506035/main.jpg
    Yasir Iqbal
  • NCP seeks firms for Saudi Arabia university hospital PPP

    1 July 2026

    Saudi Arabia’s Umm Al-Qura University, in collaboration with the National Centre for Privatisation & PPP (NCP), has launched an expression of interest for the completion of the construction and operation of the Umm Al-Qura University Hospital in Mecca.

    Issued to contractors on 30 June, the notice has a submission deadline of 21 July.

    The scope includes completing the remaining construction works, as well as the subsequent operation of the hospital.

    Upon completion, the hospital will have a capacity of 391 beds.

    The project will be delivered as a public-private partnership (PPP) under a design, build, finance, operate and maintain model.

    The contract duration is 30 years.

    The project is the latest healthcare project to be procured on a PPP basis in the kingdom. In June, MEED reported that Saudi Arabia’s Ministry of Health and NCP had awarded a PPP contract for the operation and management of the Sabic Specialised Behavioural Healthcare Hospital in Riyadh.

    That contract was awarded to SEH Healthcare, a consortium comprising local firms Specialised Medical Company (SMC Healthcare) and Health Gates Complex, and Germany’s Dr Ebel Fachkliniken.

    In a filing with the Saudi Exchange (Tadawul), SMC Healthcare said the total estimated project value is about SR3.8bn ($1bn).

    In January, Saudi Arabia launched a national privatisation strategy aimed at mobilising $64bn in private sector capital by 2030.

    Building on the privatisation programme first introduced in 2018, the strategy focuses on unlocking state-owned assets for private investment and privatising selected government services.

    In a statement, NCP said the strategy comprises 147 opportunities drawn from a broader pipeline of more than 500 projects across 18 sectors.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17506381/main.jpg
    Yasir Iqbal