World’s tallest tower is back on track

24 October 2024

 

The chairman of Saudi Arabia’s Kingdom Holding, Prince Alwaleed Bin Talal Al-Saud, published a two-word message on social media platform X on 2 October. The message, which said, “We’re back,” was accompanied by an animated video of a fly-through rendering of the world’s next tallest building, the 1,000-metre-plus Jeddah Tower. 

The post was made shortly after a pivotal event for the tower. Earlier that day, the company developing the project, Jeddah Economic Company (JEC), in which Kingdom Holding is a shareholder, signed a contract with the local Saudi Binladin Group (SBG) to resume construction work on the scheme. The SR7.2bn ($2bn) contract includes SR1.1bn for works already completed on the tower. 

SBG was the original contractor on the project before construction work stalled in 2018. This left the tower’s superstructure about one-third complete, with 63 floors built out of 157. 

Speaking to MEED after the contract signing, Kingdom Holding’s CEO Talal Ibrahim Almaiman echoed and expanded on Prince Alwaleed’s post. 

“We’re back. People have been asking questions about the project after it froze in February 2018. We had the patience, but also the determination to finish it. We will deliver what we promised to deliver at the highest possible quality, with a contractor with a long history of success when it comes to handling such huge projects,” he says.

Contractor selection

Appointing a firm to build a tower that will be the world’s tallest is more than just a major contract signing. 

“There are plenty of successes. Saudi Arabia will soon have the record for the tallest tower in the world. Kingdom Holding is doing what it does best, completing projects at the highest level. Saudi Binladin is going to get back its glory. And the people of Jeddah will have the tallest tower in the world,” says Almaiman.

The appointment of the original contractor after having started a fresh tender process for the project in late 2023 has taken some in the market by surprise. 

“Rather than talk about the past, I would like to talk about the future,” says Almaiman.

“SBG has gone through some technical and financial difficulties in the past. The latest announcement, when the Ministry of Finance said it would support them with their issues with the banks, gave them huge financial credibility. The government of Saudi Arabia being a partner and shareholder in SBG gives us huge confidence,” he adds.

With financial issues put to one side, SBG was able to put together a winning proposal to complete the tower. “The contractor spent a lot of time with our designers, quantity surveyors and other experts and went through each part of the tower and how they plan to build it by moving from floor to floor, and this method was approved by us,” says Almaiman. 

Programme and price were also key factors. “The other consortium we spoke to was planning to finish in 58 months, whereas Binladin was saying 42 months, which is three and a half years,” Almaiman explains, adding: “For pricing, we got a good deal.”

In addition, there were several practical reasons for selecting the original contractor on the project, according to Almaiman. SBG already has offices established on site and, as a Jeddah-based company with a long history of delivering major projects in Saudi Arabia, it has well-established connections with the local supply chain.

With financial issues put to one side, SBG was able to put together a winning proposal to complete the tower

Future vision

Although the Jeddah Tower project has a history that can be traced back over a decade, its ambitions are very much in tune with those of modern Saudi Arabia. 

“It is in line with the government’s Vision 2030 to create attractions for Saudi Arabia,” says Almaiman.

Vision 2030 reinforces the importance of the three-and-a-half-year programme that SBG offered because it puts the tower comfortably on course to be delivered in mid-2028, well ahead of 2030.

Completing the world’s tallest tower is just the start for the wider Jeddah Economic City development. 

“The tower is part of phase one, which is about 1.1 million square metres,” says Almaiman. 

“We are now in discussions with investors about coming in and developing. We will contribute land. We will not be selling land at phase one for the sake of selling. We will control the development and the building code,” he adds.

Securing the title

Building the world’s tallest tower inevitably prompts conversations and speculation about other rival towers being planned around the world. 

However, Almaiman is confident that Jeddah Tower’s reign as the world’s tallest will be lengthy, as he, perhaps better than anyone else, understands the challenges involved in building record-breaking towers. 

“The reason for calling the tower 1,000-plus-metres is because we will add more height. The final height of the tower will be decided by HRH Prince Alwaleed Bin Talal,” he says. 

“The other developers will probably need around 10 years to catch up, and if we keep the title for that long, I will be happy.” 

https://image.digitalinsightresearch.in/uploads/NewsArticle/12787969/main.gif
Colin Foreman
Related Articles
  • Adnoc Gas and Jera sign $450m LNG deal

    28 January 2025

    Adnoc Gas, the natural gas processing and exporting subsidiary of Abu Dhabi National Oil Company (Adnoc Group), and its subsidiaries have announced the signing of a AED1.653bn ($450m) three-year liquefied natural gas (LNG) supply agreement with Jera Global Markets, a trading subsidiary of Japan’s Jera Company Incorporated.

    The LNG will be supplied from Adnoc Gas’ Das Island liquefaction facility, which has a production capacity of approximately 6 million tonnes a year. 

    In a statement, Adnoc Gas said the agreement reaffirms the company's position as a "reliable global supplier of clean energy" while supporting Japan's energy requirements.

    Fatema Al-Nuaimi, CEO of Adnoc Gas, said the agreement builds on the robust UAE-Japan energy relationship and decades of collaboration between Adnoc Gas and Jera.

    "We will continue to support Japan’s energy needs and reinforce our position as a reliable partner in the global LNG market," she added.

    Kazunori Kasai, chief optimisation officer of Jera Company and chairman of Jera Global Markets, noted that the new supply agreement with Adnoc Gas reflects the "active measures we take to ensure that our global portfolio remains diverse, flexible and competitive".

    In October 2023, Adnoc Gas also won an order for LNG supply from Jera Global Markets.

    The value of the multi-year LNG supply contract was between $500m and $700m, Adnoc Group said at the time. The company did not specify the duration of the agreement or the volume of LNG that Adnoc Gas will supply each year.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13344453/main.jpg
    Jennifer Aguinaldo
  • Lunate to acquire Snam stake in Abu Dhabi pipeline

    28 January 2025

    Abu Dhabi-based investment firm Lunate is to acquire a minority stake in Adnoc Gas Pipelines that is indirectly held by Italian gas infrastructure operator Snam.

    The deal comes less than one year after Lunate acquired a 40% stake in Adnoc Oil Pipelines from US asset management firms BlackRock and KKR.

    The transaction with Snam, which is subject to the signing of the sale and purchase agreement, as well as to the potential exercise of the relevant shareholders’ rights, will be made through Lunate’s Long-Term Capital Fund 1, Snam said in a statement on 28 January.

    Adnoc Gas Pipelines, a subsidiary of state energy company Abu Dhabi National Oil Company (Adnoc), has lease rights to 38 pipelines covering a total of 982 kilometres across the UAE.

    The gas pipeline network serves as a strategic link connecting Adnoc's upstream assets to local UAE offtakers.

    "It represents a high-quality and essential asset that generates stable and predictable cash flows in a critical sector and is a major contributor to the UAE’s energy infrastructure strategy," the statement said.

    Snam acquired its stake in Adnoc Gas Pipelines in 2020, along with other consortium partners, including GIP, GIC, Brookfield Asset Management, Ontario Teachers’ Pension Plan Board and NH Investment & Securities, through Galaxy Pipeline Assets HoldCo.

    Lunate acquired its 40% stake in Adnoc Oil Pipelines from BlackRock and KKR in April 2024.

    The acquisition by Lunate’s Long Term Capital Fund was executed through the purchase of a 100% stake in a special purpose vehicle jointly held by BlackRock and KKR managed funds, Lunate said at the time.

    The parties did not disclose the financial terms of the deal. BlackRock and KKR spent $4bn on the acquisition of the 40% stake in Adnoc Oil Pipelines in 2019.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13344300/main3019.jpg
    Jennifer Aguinaldo
  • Acwa Power and Snam plan hydrogen cooperation

    28 January 2025

    Riyadh-based utility developer and investor Acwa Power has signed a memorandum of understanding with Italy's Snam to explore collaboration and joint investments to establish a green hydrogen supply chain to Europe.

    A leading European operator in natural gas transportation, storage and regasification, Snam aims to build "a pan-European multi-molecule infrastructure, advancing energy security and the transition to net zero", a joint statement said.

    Acwa Power is developing the largest known green hydrogen and ammonia plant in the Neom gigaproject in Saudi Arabia.

    The partnership will "explore potential collaboration and joint investments to establish an international supply chain for a dependable and cost-effective supply of green hydrogen from Saudi Arabia to Europe".

    The two firms also plan to explore the development of an ammonia import terminal in Italy to facilitate the delivery of green hydrogen through the South H2 Corridor, the 3,300-kilometre-long corridor reaching central Europe through Italy, Austria and Germany.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13344199/main.gif
    Jennifer Aguinaldo
  • Sace to provide $100m credit to Acwa Power

    28 January 2025

    The Italian insurance and financial group fully owned by Italy's Economy & Finance Ministry, Sace, has agreed to provide a credit facility worth $100m to support Saudi utility developer Acwa Power's green projects in Central Asia.

    The deal will facilitate the export of Italian companies and is in line with Sace's mandate, a joint statement said on 26 January.

    "Sace will provide a $100m line of credit to Acwa Power in exchange for a commitment to create business matching opportunities with Italian companies in their respective areas of interest," the statement said.

    Sace and Acwa Power have also documented a commitment to explore new opportunities and evaluate up to $500m in support, to facilitate exports from Italy and promote the internationalisation of Italian companies, including small and medium-sized enterprises.

    The agreements were signed by the CEO of Acwa Power, Marco Arcelli, and by the CEO of Sace, Alessandra Ricci, on the occasion of Italian Prime Minister Georgia Meloni's visit to Saudi Arabia.

    The agreement with Sace is one of several that Acwa Power signed with Italian companies on the sidelines of the Saudi-Italian High-Level Roundtable Meeting in Al-Ula, Saudi Arabia.

    It signed agreements with Cassa Depositi e Prestiti (CDP), the Italian financial institution for development cooperation; De Nora, a multinational company specialising in water treatment technologies; and Ansaldo Energia, a power generation equipment manufacturer.

    The latter agreement was signed by Nomac Holding, a fully-owned subsidiary of Acwa Power.

    Acwa Power's Arcelli said: "The opportunities for cooperation between Saudi and Italian companies are immense in the sphere of supply, localisation, financing and energy.

    "We believe that bringing together our competencies and resources will significantly advance energy transition and water security, promoting sustainable infrastructure developments not only in our countries but also in Africa, Central and Southeast Asia and the rest of the Middle East."

    Photo credit: Acwa Power

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13341499/main.jpg
    Jennifer Aguinaldo
  • Firm wins Al-Nouf IWP technical advisory role

    27 January 2025

     

    Abu Dhabi-based offtaker Emirates Water & Electricity Company (Ewec) is understood to have awarded the technical advisory contract for its next independent water project (IWP) in Al-Nouf.

    According to sources familiar with the project, the planned Al-Nouf seawater reverse osmosis (SWRO) IWP will have a design capacity of up to 170 million imperial gallons a day (MIGD), or approximately 772,835 cubic metres a day (cm/d).

    Austria-headquartered ILF Consulting Engineers has won the contract, industry sources tell MEED.

    MEED understands that the legal and financial advisory packages for the Al-Nouf IWP will be tendered and awarded separately.  

    Al-Nouf will be Abu Dhabi's second-largest IWP after the 909,218-cm/d Taweelah SWRO plant, which reached full commercial operations in April 2023. It will be the UAE's third-largest, slightly behind Dubai's 818,280-cm/d Hassyan 1 SWRO project, which is under construction.   

    A facility in Al-Nouf will require a long pipeline that will connect the plant to Abu Dhabi, and will likely involve the participation of Abu Dhabi Transmission & Despatch Company (Transco), sources told MEED last year.

    This latest development follows a revision of the scope and capacity of Abu Dhabi's fourth IWP scheme. The Saadiyat Island IWP will have a capacity of 60MIGD.

    When it was tendered in July 2023, the original scheme – called the Abu Dhabi Islands IWP – comprised two SWRO plants, each with a capacity of 50MIGD, to be located on the Saadiyat and Hudayriat islands in Abu Dhabi.

    Ewec previously said these projects are important to Abu Dhabi’s water security due to their proximity to the load centre of the Abu Dhabi islands, and because of the scheduled decommissioning in 2028 of the integrated power and water desalination plant at Sas Nakhl.

    As in previously tendered IWPs, the successful developer or consortium will own up to 40% of a special-purpose vehicle that will implement these projects, while the remaining equity will be primarily held indirectly by the Abu Dhabi government.

    Awarded IWP contracts 

    Ewec and Spain's Acciona, the lowest bidder for the Saadiyat Island IWP that was tendered last year, have yet to sign a water purchase agreement.

    In comparison, Ewec awarded the contracts for two IWPs in 2023. Ewec, Abu Dhabi National Energy Company (Taqa) and France’s Engie signed the water purchase agreement for the Mirfa 2 IWP project in February 2023. They reached financial close for the project, which will have a capacity of 120MIGD, two months later.

    Taqa, Ewec and South Korea’s GS Inima reached financial close on the $444m Shuweihat 4 SWRO IWP in December of the same year. Located within the Shuweihat power and water complex, the facility will supply up to 70MIGD of potable water. Commercial operations are expected to commence in the second quarter of 2026.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13341397/main.gif
    Jennifer Aguinaldo