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The region’s most ambitious causeway projects

8 February 2023

 

The submission of feedback questionnaires and meetings with contractors for the planned second causeway connecting Saudi Arabia and Bahrain is the latest sign of potential progress on one of the region’s largest infrastructure projects.

Causeways have a chequered history in the region. The first causeway connecting Saudi Arabia and Bahrain was completed during the 1980s, and since then, it has had a transformative impact on the Bahraini economy. 

The project’s success has inspired other causeways. But while these schemes remain ambitions for many in the region, construction progress has been limited. The hope is that a successful second causeway linking Saudi Arabia and Bahrain will foster the delivery of other longstanding causeway plans.

These are the most ambitious causeway schemes that the region has planned:

 Second Saudi Arabia-Bahrain causeway

The second causeway between Saudi Arabia and Bahrain is the most likely to proceed. Planned by the King Fahd Causeway Authority, the $3.5bn project, which has been called the King Hamad Causeway project, is moving towards construction.

In 2021, senior government officials in Bahrain told MEED that the project was progressing towards tendering as financial studies had been completed.

The project was included in Bahrain’s $30bn Strategic Projects Plan that was announced later in 2021. As well as the causeway, the plan includes building new urban areas on five reclaimed islands to increase the country’s total land area by 60 per cent. It also comprises plans for a new airport.

The second causeway involves building a 25-kilometre road and rail crossing linking Saudi Arabia and Bahrain. It will follow the same alignment as the existing King Fahd Causeway.

It has been earmarked for delivery on a public-private partnership (PPP) basis. The King Fahd Causeway Authority appointed a consortium to provide transaction advisory services in late 2019.

The $8.9m consultancy agreement was signed with a consortium of Netherlands-headquartered KPMG, US-based Aecom and UK-based CMS. The team was tasked with working on developing the financing model, the required engineering specifications and design, as well as helping with the assessment and selection of the project’s developers.

Canada-based SNC Lavalin and UK-based consultancy firm PwC conducted the project due diligence study in 2017.

The existing King Fahd Causeway is operating at capacity. About 11.5 million cars cross the causeway every year, and the growth has been 6 per cent per annum over the past 10 years.

 Qatar-Bahrain causeway

There have also been suggestions that the proposed causeway bridging Bahrain and Qatar may be revived. In March 2022, Manama called for work to restart on the causeway joining the two countries.

“We in the Kingdom of Bahrain renew the call for the start of bilateral talks between the two sides in accordance with the mechanisms agreed upon in the Al-Ula statement,” said Bahrain’s undersecretary for land transportation and post in an official statement published by the official Bahrain News Agency.

The estimated $4bn Qatar-Bahrain causeway project was put on hold and the contracting consortium demobilised in 2010.

A joint venture of state-owned developer Qatari Diar Real Estate Investment Company and French contractor Vinci Construction Grand Projets led the consortium. The other consortium members were Germany’s Hochtief, Athens-based Consolidated Contractors Company (CCC), Dredging International from Belgium and the local Middle East Dredging Company (Medco).

The planned 40km bridge includes a four-lane motor crossing scheduled for completion in 2013 and two railway lines forming part of the GCC rail network.

The project also comprises 22km of bridges and viaducts, 18km of embankments and two 400-metre cable-stayed bridges. The causeway connects Ras Ashairij on the west coast of Qatar to Askar on the east coast of Bahrain.

The project was also known as the Friendship Bridge and was to be jointly funded by the Qatari and Bahraini governments, which intended to recover some of the construction costs by implementing a toll system on the bridge.

The crossing would cut the journey time between the two countries, which currently involves a detour through Saudi Arabia, from five hours to just 30 minutes.

 Saudi Arabia-Egypt causeway

The prospects for the causeway connecting the $500bn Neom project in Saudi Arabia and Egypt’s Sinai Peninsula across the Straits of Tiran improved last year after US President Joe Biden’s visit to Saudi Arabia.

After the visit, a joint communique issued by Washington and Riyadh referred to the development of Tiran Island.

“President Biden welcomed the arrangements by Saudi Arabia to remove the Multinational Force & Observers (MFO) from the Island of Tiran, including the removal of US troops there as part of the MFO mission, while preserving and continuing all existing commitments and procedures in the area,” it said. 

“This area of the Red Sea will now be developed for tourism and economic purposes, contributing to a more secure, peaceful and prosperous region.” 

The US-Egyptian-Israeli-backed MFO was founded in 1981 to oversee the terms of the 1978 Camp David Accords, which included the full Israeli withdrawal from the Sinai Peninsula.

In 2016, Egypt and Saudi Arabia agreed during a state visit to Cairo by King Salman bin Abdulaziz al-Saud to develop a causeway linking the two countries across the Red Sea. 

The agreement was made as part of a broader deal that would also involve Egypt ceding the sovereignty of the two Tiran islands to Saudi Arabia.

While details of the proposed crossing were never revealed at the time, it was understood to be a revival of a $4bn project announced in 2011. That scheme involved building a 32km crossing stretching over the Straits of Tiran from Ras Humaid in Tabuk, in the northern region of Saudi Arabia, to Ras Nasrani, close to the Egyptian resort of Sharm el-Sheikh.

Plans to link Saudi Arabia and Egypt are far from new. The development of a causeway was first mooted as far back as 1988. However, the idea has received additional focus in recent years following the launch of the Neom development in northwestern Saudi Arabia, which includes Ras Humaid. Part of the Neom scheme, the 170km-long linear city known as The Line, will extend from the promontory inland to the city of Tabuk.

UK-based Arup was reported to have been selected in 2019 for the next stage of the feasibility study for the causeway. 

Saudi Arabia was understood to be considering using a public-private partnership (PPP) model for the scheme, similar to other transport projects planned in and around the kingdom.

 Yemen-Djibouti causeway

A 28.5km causeway was planned to connect Yemen and Djibouti before the scheme was put on hold in 2010 until the governments of both countries signed the framework agreement for the project. The civil war in Yemen means it is unlikely the scheme will make any progress soon.

The estimated $20bn first phase involved building the link between the Yemeni mainland to the island of Perim in the Red Sea. Phase two would have then connected Perim with Djibouti.

The wider project also involves building two cities at each end of the link. The total investment required to construct the cities and the bridge is $200bn.

Dubai-based Al-Noor Holding Investment Company was developing the project.

In 2009, the company said it expected to award a build-operate-transfer contract for the first phase of the bridge and that three companies had expressed interest in funding and building the road and rail link. Denmark’s Cowi prepared the preliminary design for the crossing.

 UAE-Qatar causeway

In 2005, Abu Dhabi and Doha were reported to have been setting up a joint company to oversee the implementation of the proposed UAE/Qatar causeway.

The 40km causeway was expected to start near Sila in Abu Dhabi emirate and extend to the south of Doha.

The estimated $13bn crossing would have significantly cut journey times. At present, traffic between Qatar and the UAE has to pass through 125km of Saudi Arabian territory.

The scheme stalled shortly afterwards. Problems included difficulties with the route, which ran through Saudi Arabian territorial waters.

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Colin Foreman

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    > Notify key stakeholders early: Key stakeholders are those that have a vested interest in the project, either through ownership of certain assets on site, such as grid connection assets, or via regulation, such as the environmental authority. Many of these stakeholders take time to respond, so notifying key stakeholders early in the process can ensure that unnecessary delays are avoided.

    > Prioritise HSSE: For any future decommissioning project, HSSE must be a top priority, and this should be the focus throughout the entire decommissioning process – at all levels of work and management. 

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    > Appoint the environmental consultant early in the process: It is advisable to appoint an environmental consultant early in the process. The consultant is needed to coordinate activities with the local environmental authority and obtain a no-objection letter or certificate, complete an environmental management report and an update of the environmental impact assessment, which includes an environmental baseline.

    Ideally, these reports and environmental authority approvals should be completed well before any work is under way at the site. This information is also useful to potential bidders for the sale of equipment, or to contractors involved in the dismantling and demolition process.

    > Submit an environmental management plan for approval: It is unlikely that any environmental authority will provide a no-objection letter or certificate without reviewing the environmental plan. It is therefore necessary to complete the plan early, prior to informing the environmental authority. This can minimise potential delays in starting the decommissioning process. 

    As a general practice, an environmental consultant should be brought on board early in the process, ideally once the overall master plan is approved by the company.

    > Establish a proactive steering committee: This was done at Al-Kamil and proved to be effective when it came to overseeing project progress and dealing with issues as they arose. Certain members of the steering committee visited the site regularly and undertook spot HSSE inspections.

    At Al-Kamil, the overall decommissioning was relatively straightforward as the plant was in a remote area. However, decommissioning a power plant in a busier location, or when part of the power plant remains in operation, is more challenging. Under these circumstances, a steering committee is vital. 

    > Set realistic delivery and completion timelines: Decommissioning a power plant is a complex process. The initial timeline to complete the process for Al-Kamil was one year, which was the best estimate at the time as there were no benchmarks or references in Oman. However, the actual completion time turned out to be three years – longer than the approximately 2.5 years it took to build the plant, from the start of construction in early 2001 to full commercial operation in July 2003.

    Realistic delivery dates should be set for contractors, suppliers and others involved in the decommissioning process. This is likely to result in better pricing, as bidders tend to factor in higher contingencies with shorter or fast-track delivery dates. More realistic delivery dates also help management to allocate staff resources and manage the decommissioning budget. 

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    > Allow time to maximise revenues from the sale of assets: The market value for Al-Kamil’s power assets was estimated at a value significantly higher than the prevailing scrap value. This was based in part on the value of similar gas turbine units, after adjusting for age, usage and other factors that affect the net market value. However, the company realised a much lower value, even after retendering the equipment sales in an effort to get a better price.

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    Moreover, as renewables continue to penetrate the market, there is less worldwide demand for used gas turbine units. Prevailing market supply and demand conditions also have a bearing on the sale price for secondary equipment, and this factor needs to be considered.

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    Main image: Picture 1: Al-Kamil power plant as constructed; Picture 2: Post decommissioning 

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