Doha Transport Infrastructure Continues To Attract Interest
Over the past few weeks, there have been continuous - although inconsistent - reports in the media regarding the construction contracts of the various sections of the Doha Metro. While some of the reports remain unconfirmed, the companies mentioned highlight the international interest in the tenders.
Initially, there were rumours about the Red Line North being awarded to a consortium led by the Italian Impregilo, a contract worth US$2.2bn. Later on, media leaks suggested that a contract to build 12km of the Red Line South had been awarded to a consortium led by the French Vinci. In turn, the 15km underground section of the Green Line has been attributed to a consortium led by Austrian Porr.
The most recently confirmed news refer to the US$ 1.4bn contract awarded to a consortium of the Spanish OHL group, South Korean Samsung C&T and the Qatar Building Company. The consortium is responsible for designing and building two of the main Doha Metro stations, Msheireb and Education City. Despite questions on post-World Cup demand, the Metro is a key component of Doha's infrastructure development. In addition, expanding public transport capacity aligns with the city's ambition to become more environmentally friendly by reducing the use of private vehicles.
|News Date||Doha Metro Section||Consortium (led by)||Estimated Value (US$)||Status||Source|
|Source: BMI Research|
|20/05/2013||Red Line North||Impregilo - Italy||2.2bn||Unconfirmed report||International Railway Journal|
|31/05/2013||Msheireb and Education City stations||OHL Group - Spain||1.4bn||Confirmed||Arabian Business|
|03/06/2013||Red Line South||Vinci - France||-||Unconfirmed report||Construction Week Online|
|03/06/2013||Green Line (underground)||Porr - Austria||-||Unconfirmed report||Construction Week Online|
The high interest of international contractors in the Doha Metro system confirms the attractiveness of the Qatari market. The 2022 FIFA World Cup has been a major driver of growth for the construction industry, especially for the transport sector. There are a high number of contracts on offer to match the strong appetite of investors in the region. In Q213, Qatar secured the top spot in our Middle East and North Africa regional infrastructure risk/rewards ratings (RRRs), with 67.7 out of 100. The country remains a regional outperformer by some margin, and has long been one of BMI's top markets in the region.
Government austerity measures and the collapse of the property market in Spain have forced OHL to look for opportunities abroad. In doing so, the company reported the best financial year since its creation, with a growth of 38.1% in EBITDA. This contract strengthens the presence of OHL in the Qatari market and the wider region where it already operates projects such as the US$ 2bn Medical and Research Centre of Sidra and the high-speed railway between Makkah and Madinah.