Syria wrestles fragile security situation
18 July 2025
A surge in violence in the southern Syrian province of Suwayda in mid-July has served as a reminder of both the fragile hold of the new government administration in Damascus over the country and the uneasy position of Syria’s minorities under it.
Recent events have seen armed clashes between members of the Bedouin and Druze communities in Suwayda Province, and subsequently also with government forces – killing hundreds – after intercommunal tensions spiralled out of control.
Simmering sectarian tensions between the region’s Druze and Bedouin populations first boiled over into armed conflict on 11 July after a Druze merchant was abducted from the highway. Though the individual was later released, the incident triggered a wave of retaliatory kidnappings and attacks between Bedouin and Druze communities. By 13 July, government checkpoints were also being attacked, triggering the Interior Ministry to dispatch security forces to stem the violence.
Over the following days, government forces also became entangled in the fighting, and Israel meanwhile took the opportunity of the chaos to conduct further strikes against the Syrian military on the pretence of protecting the Druze community.
On 16 July, after days of mounting casualties and accusations that the government had sided with Bedouin elements against Druze civilians, Syrian President Ahmed Al-Sharaa released a statement condemning the violence and promising state accountability.
Later, the Druze council in Suwayda reached an agreement with Damascus for a local ceasefire, alongside a range of provisions for the restoration of local security and the establishment of a fact-finding committee to probe recent violations.
Two days later, on 18 July, renewed clashes between local groups saw the Druze council call for government forces to return to the area to enforce the peace – emphasising that the trouble in the south is likely still far from over.
Fragile stability
The escalation in intercommunal violence in Syria’s south has underlined the relative fragility of the uneasy calm that has settled over the country since the toppling of the Baathist government of Bashar Al-Assad in December.
The sequence of events also draws parallels with the violence in western Syria earlier in the year, in which government forces stepped in to stem violence involving the Alawi community but instead caused hundreds more casualties.
A key difference between the two episodes is that while the Alawi communities had largely voluntarily disarmed themselves, the Druze community has resisted its own disarmament, pointing to the government’s poor record in protecting minority groups.
The outcome, in turn, has been very different, with the government seemingly much more amenable to a negotiated solution – perhaps also helped along by the lessons learned as a result of the earlier spate of violent altercations in the coastal region.
There is another cause for Damascus’ swift push for a conciliatory, negotiated settlement: Israel’s clear interference in the country and attempts to incite the Druze community against the Syrian government.
Such a ploy falls in line with long-standing Israeli aspirations to expand its buffer along the border. Tel Aviv has openly stated its opposition to government forces operating south of Damascus, as well as its interest in furthering Druze autonomy in the area.
On 16 July, Israel bombed the main military staff headquarters in Damascus and threatened to proceed with further attacks on the capital if government forces did not withdraw from Suwayda. While the act drew international condemnation as a violation of Syrian sovereignty, it also showed the extreme latitude that Israel has become accustomed to operating with as it partially occupies southern Syria.
To date, both the Syrian government and Syrian Druze community leadership have nevertheless remained in alignment in resisting the Israeli tactics of division. Even so, given how fast-moving the situation in the south is, it will require a steady hand to contain.
Nor is it Syria’s only flashpoint. In the northeast, Damascus and the Kurdish-led Syrian Democratic Forces remain at odds over how best to achieve the agreed-upon integration of the latter’s forces under the Syrian government’s central command.
Meanwhile in the capital, the looseness of the Syrian government’s grip on the security situation was also highlighted in late June by the bombing of a church in central Damascus by Sunni extremist group Saraya Ansar Al-Sunnah.
Uneasy partnerships
Given the existing challenges that the government already faces in attempting to knit the country back together both economically and politically, ongoing outbursts of sectarian tension and unpredictable terrorist attacks are disruptions it can ill afford.
Al-Sharaa’s task is being made more difficult by the scepticism that many minority groups have towards a government – not to mention the rank and file of the police and military – that contains significant numbers of former militant Islamist group members.
Still, the Syrian government’s uneasy partnership with the Kurds and its more recent compact with the Suwayda Druze council show that the senior political leadership is coming around to the advantages of the negotiations table over the battlefield.
It is perhaps also because Al-Sharaa knows that as quickly as he was able to get the Western powers to repeal sanctions on Syria, any actions that refresh international consternation could just as easily see sanctions snapped back into place.
Al-Sharaa must enforce the law convincingly and without fault if he is to maintain the peace and ensure that the country’s enemies – both within and without – do not find an opportunity to once again unravel Syria at the seams.
READ THE JULY 2025 MEED BUSINESS REVIEW – click here to view PDF
UAE and Turkiye expand business links; Renewed hope lies on the horizon for trouble-beset Levant region; Gulf real estate momentum continues even as concerns emerge
Distributed to senior decision-makers in the region and around the world, the July 2025 edition of MEED Business Review includes:
> AGENDA: UAE-Turkiye trade gains momentum
> INTERVIEW 1: Building on UAE-Turkiye trade
> INTERVIEW 2: Turkiye's Kalyon goes global
> INTERVIEW 3: Strengthening UAE-Turkiye financial links
> INTERVIEW 4: Turkish Airlines plans further growth
> CURRENT AFFAIRS: Middle East tensions could reduce gas investments
> GCC REAL ESTATE: Gulf real estate faces a more nuanced reality
> PROJECTS MARKET: GCC projects market collapses
> INTERVIEW 5: Hassan Allam eyes role in Saudi Arabia’s transformation
> INTERVIEW 6: Aseer region seeks new investments for Saudi Arabia
> LEADERSHIP: Nuclear power makes a global comeback
> LEVANT MARKET FOCUS: Levant states wrestle regional pressures
> GULF PROJECTS INDEX: Gulf projects index continues climb
> CONTRACT AWARDS: Mena contract award activity remains subdued
> ECONOMIC DATA: Data drives regional projects
> OPINION: A farcical tragedy that no one can end
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Aramco turns attention to strategic projects
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Saudi Arabia seeks consultants for Riyadh rail link
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Petrofac agrees restructuring deal with Samsung and Saipem
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Aramco turns attention to strategic projects
12 September 2025
In the second quarter of 2025, Saudi Aramco’s capital expenditure (capex) stood at $12.3bn, marking a marginal year-on-year increase of 1.46%. For the first half of the year, the company recorded capex of $24.85bn, up 9.5% compared to the same period last year.
The company had earlier issued capital investment guidance of $52bn to $58bn for 2025, excluding approximately $4bn in project financing.
Concerns grew in Saudi Arabia’s offshore oil and gas projects market earlier this year as engineering, procurement, construction and installation (EPCI) contract awards stalled.
Aramco spent a record $5bn on offshore EPCI contracts in 2024 and was expected to surpass that in 2025. However, it awarded no Contract Release Purchase Orders (CRPOs) in the first half of the year, fuelling apprehension among contractors and suppliers.
In July, Aramco dispelled speculation by awarding five tenders worth over $3bn. The CRPOs are numbers 150, 157, 158, 159 and 160, and involve EPCI work and infrastructure upgrades at the Abu Safah, Berri, Manifa, Marjan and Zuluf offshore oil fields.
Aramco also awarded four additional CRPOs as part of a large-scale infrastructure expansion at the Zuluf offshore field. These are CRPOs 145, 146, 147 and 148, with a combined estimated value of nearly $6bn.
With these contract awards, Aramco has nearly doubled its offshore capex this year compared to 2024, marking another year of robust upstream investment.
Looking ahead, Aramco is evaluating bids received for seven key tenders in July and August.
These tenders include CRPOs 154, 155 and 156, representing the next phase of infrastructure expansion at the Safaniya offshore oil field; CRPO 161, which covers the EPCI of four gas jackets at the Arabiyah, Hasbah and Karan fields; and CRPOs 162, 163 and 164, relating to the EPCI of key infrastructure at the Abu Safah, Berri, Karan, Marjan and Safaniya fields.
Onshore projects advance
In parallel with the Safaniya offshore expansion, Aramco is tendering a separate project to build onshore surface and processing facilities to handle additional volumes of oil and associated gas generated by the expanded offshore infrastructure.
The scope of the Safaniya onshore facilities project has been divided into two main EPC packages: the first covering water treatment and injection units, and the second focused on produced water utilities. Contractors have been given deadlines of 24 October and 7 November to submit technical and commercial bids.
Aramco is also understood to be close to awarding the main EPC contracts for the expansion of the Haradh gas-oil separation plant 3 (Gosp 3) in Saudi Arabia. Located within the Haradh hydrocarbons development in the Eastern Province, the project will increase output of the Arab Light crude grade from 300,000 barrels a day (b/d) to 420,000 b/d. It will also raise sour gas production to 32 million cubic feet a day (cf/d).
Ramping up gas production
In line with its goal of increasing gas production, Aramco is progressing its Jafurah unconventional gas programme. Situated in Saudi Arabia’s Eastern Province, the Jafurah Basin contains the largest liquid-rich shale gas play in the Middle East, with an estimated 200 trillion cubic feet of gas in place. The shale play spans approximately 17,000 square kilometres.
The Jafurah programme is a cornerstone of Aramco’s long-term gas strategy, with total lifecycle investment expected to exceed $100bn. In February 2020, Aramco received a capex allocation of $110bn from the Saudi government to support the long-term phased development of the unconventional gas resource base.
Aramco is estimated to have spent $25bn across the first three phases of Jafurah’s development. In November 2021, the company awarded $10bn in subsurface and EPC contracts for phase one of the programme.
On 30 June 2024, Aramco awarded 16 contracts worth approximately $12.4bn for phase two. The scope includes the construction of gas compression facilities, associated pipelines and the expansion of the Jafurah gas plant – covering gas processing trains, utilities, sulphur handling and export infrastructure.
In July 2024, a consortium of Spain’s Tecnicas Reunidas and China’s Sinopec was awarded a $2.24bn EPC contract by Aramco for phase three of the expansion.
Phase four of the Jafurah expansion is estimated at $2.5bn. The scope includes EPC works for three gas compression plants, each with a capacity of 200 million cf/d. Bids were submitted in mid-January, remain valid through September, and are under evaluation, with a contract award expected in Q4 2025.
Aramco is also tendering a major project to boost gas compression capacity at the Shedgum and Uthmaniya plants in the Eastern Province.
The facilities currently receive approximately 870 million cf/d and 1.2 billion cf/d of Khuff raw gas, respectively. The project aims to increase compression and processing capacity and to construct new pipelines to enhance gas transport.
Contractors are preparing bids for several EPC packages under the Shedgum and Uthmaniya gas compression project.
MEED’s October 2025 special report on Saudi Arabia also includes:
> ECONOMY: Riyadh looks to adjust investment approach
> BANKING: New funding sources solve Saudi liquidity challenge
> GAS: Saudi Arabia and Kuwait accelerate Dorra gas field development
> POWER: Saudi Arabia accelerates power transformation
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> TRANSPORT: Infrastructure takes centre stage in Saudi strategyhttps://image.digitalinsightresearch.in/uploads/NewsArticle/14656451/main.png -
GCCIA signs $500m deal for Oman power link
12 September 2025
The GCC Interconnection Authority (GCCIA) has signed a $500m interim financing agreement with Sohar International Bank to support the planned direct electricity interconnection between Oman and the GCC grid.
The project will involve building a 400-kilovolt double-circuit transmission line linking the Al-Sila station in the UAE with a new Ibri station in Oman. The line will span 530km.
The Al-Sila station, located in Abu Dhabi near the border with Saudi Arabia, is owned and operated by GCCIA. It is a key node in the existing Gulf power grid, enabling the transfer of electricity between the UAE, Saudi Arabia and other GCC states.
The Ibri station will be newly developed by GCCIA as part of the interconnection project. Situated in Oman’s Al-Dhahirah governorate, the facility will act as the entry point for linking Oman’s national grid to the wider GCC network. Oman is currently connected via the UAE grid.
The link will provide a transmission capacity of 1,700MW and a net transfer capacity of 1,200MW.
In February, MEED reported that the interconnection project would require around $700m of investment.
It had previously been estimated that the project could cost around $1bn.
The Qatar Fund for Development (QFFD) signed an agreement with the GCCIA in the same month to finance part of the electricity transmission network that will form Oman’s second link with the GCCIA network.
Local media reports suggested that QFFD would provide around $100m for the project.
Although a contract has yet to be awarded, it is understood that Bahwan Engineering Company is among the firms that have submitted bids for the project.
In June, Abu Dhabi Fund for Development (ADFD) signed a financing agreement with the GCCIA to support a $205m project linking the Al-Sila substation to Saudi Arabia’s Salwa substation.
This involves the construction of a 400kV double-circuit overhead transmission line extending 96km and includes the expansion of three key substations in Gonan, Al-Sila and Salwa.
Oman’s first link with the GCCIA became operational in November 2011.
It comprises a 200kV line connecting the Mahadha grid station in Al-Wasit, Oman, to the Al-Oha grid station in Al-Ain, UAE.
Projects are also under way for interconnection with Kuwait, as well as with Iraq, as part of a major investment.
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Qatar’s Ashghal awards $101m construction contracts
12 September 2025
Qatar’s Public Works Authority (Ashghal) has awarded two contracts worth over QR368m ($101m) for the construction of projects across various locations in the country.
The first contract, worth QR228m ($62m), was awarded to the local firm Bo Jamhoor Trading & Contracting Company. The scope of the contract encompasses the construction of three new schools at different sites in Qatar.
The other QR140m ($38m) contract was awarded for the repair and renovation works at the Al-Zubara horse breeding farm, located about 60 kilometres (km) from Doha.
The contract was awarded to the local firm Generic Engineering Technologies & Contracting.
The latest award follows Ashghal’s issuance of a tender inviting firms to bid for the construction of roads and infrastructure in Wadi Al-Banat North, Zone 70.
The tender was floated on 3 September, with a bid submission date of 30 September.
The contract duration is three years from the start of construction.
Market overview
After 2019, there was a consistent year-on-year decline in contract awards in Qatar’s construction and transport sectors. The total value of awards in that year was $13.5bn, but by 2023 it had fallen to just over $1.2bn.
In 2024, the value of project contract awards increased to $1.7bn, bucking the downward trend in the market in the preceding four years.
Of last year’s figure, the construction sector accounted for contract awards of over $1.2bn, while transport contract awards were about $200m.
There are strategic projects worth more than $5bn in the bidding phase, and these are expected to provide renewed impetus to the construction and transportation market, presenting opportunities for contractors in the near term.
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Saudi Arabia seeks consultants for Riyadh rail link
12 September 2025
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Saudi Arabia Railways (SAR) has floated a tender notice inviting consultants to bid by 28 September for a contract covering the design review and construction supervision for the Riyadh rail link project.
The 35-kilometre-long double-track rail line will run from the north of Riyadh to the south, connecting SAR's North-South railway network with the Eastern Railway network.
Last week, MEED exclusively reported that SAR had asked contractors to prequalify for a contract covering the construction of the Riyadh rail link.
The contract also includes the procurement, construction and installation of associated infrastructure, including viaduct construction, civil works, utility installations, signalling systems and other associated works.
The project is expected to become a key component of the Saudi Landbridge railway.
The Saudi Landbridge is an estimated $7bn project comprising more than 1,500km of new track. Its core component is a 900km new railway between Riyadh and Jeddah, which will provide direct freight access to the capital from King Abdullah Port on the Red Sea.
Other key sections include upgrades to the existing Riyadh-Dammam line and a link between King Abdullah Port and Yanbu.
The start of the tendering activity for the Riyadh rail link project makes the construction of the Saudi Landbridge project even more likely.
The project is one of the kingdom’s most anticipated infrastructure programmes. Plans to develop it were first announced in 2004, but the project was put on hold in 2010 before being revived a year later.
Key stumbling blocks were rights-of-way issues, route alignment and its high cost.
In December 2023, MEED reported that a team of US-based Hill International, Italy’s Italferr and Spain’s Sener had been awarded the contract to provide project management services for the programme.
If it proceeds, the Landbridge will be one of the largest railway projects ever undertaken in the Middle East – and among the biggest globally.
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Petrofac agrees restructuring deal with Samsung and Saipem
12 September 2025
The UK-based engineering company Petrofac has announced that it has reached an agreement in principle with South Korea’s Samsung E&A and Italy’s Saipem that will allow the company to restructure.
The announcement comes more than two months after an appeals court in the UK ruled against Petrofac’s restructuring plans and in favour of Samsung E&A and Saipem.
The dispute between the three firms, which all have a significant presence in Middle East oil and gas projects, is centred on Petrofac’s participation in the $4bn Thai Oil clean fuels project.
Petrofac said that the commercial terms of the new agreement between the three companies have been supported by an “Ad Hoc Group” of bondholders.
This refers to a group of senior secured creditors that backstopped the original restructuring plan earlier this year.
Petrofac has said that it will now “work to conclude discussions with key stakeholders on next steps towards implementation of the restructuring”.
It added that, “subject to receipt of all requisite approvals and satisfaction of conditions”, it expects its restructuring to be completed by the end of November 2025.
Petrofac did not give any details about what commercial terms had been agreed with Samsung E&A and Saipem.
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