Jubail: the biggest is getting bigger

KFIP has Completed AN 800,000m? petrochemical quays with five new berths that can accomodate tankers.
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Dinic says the next step for Jubail’s freight facilities is the construction of the Jubail Rail Network, a 195km heavy rail line across Jubail One and Two which will transport products from the industries to the ports, primarily Jubail Commercial Port.

“We have already completed a concept study and we’re now proceeding with the front end engineering design. We are also in discussions with Saudi Rail Organisation (SRO) to link it up with the northern rail line and the line from Dammam,” he says.

“Ultimately we’ll have to complete it by 2013, for Jubail One at least.”

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Residential growth
As the industrial capacity of Jubail Industrial City grows, so too does its demand for workers and residential units.

Dinic says the city currently has a permanent night time population of around 100,000 but this is expected to grow to around 300,000 with the develo-pment of four new residential districts, Jalmudah, Mutrafiyah, Mardumah and Reggah. Each of the areas is around 10km² and when built up will have 8500 dwelling units housing around 45,000 people.

In the Jalmudah district construction of 650 houses is already underway, through three contracts that have been issued by the Royal Commission and more to follow.

For the Mutrafiyah area two site preparation contracts have been awarded and a third is in bidding. The Mardumah area is currently in the master planning stage with the master plan for Reggah to commence shortly after.

On top of this, Dinic says Sabco is also involved in managing the master plan for a city centre covering 3.5km², which will act as a centre for all the districts and which is sandwiched between the three new districts overlooking the bay area.

Site preparation is also underway for Jubail University College, a development covering 1.85km².

“There are huge contracts to come in the form of academic buildings and residential areas for the university – we’re talking billions of riyals,” says Dinic.

The entire residential area build up isn’t expected to be completed until 2023.

Obtaining finances
Across the region construction contracts are becoming thin on the ground and financing harder to obtain, but Jubail Industrial City is bucking the trend.

Far from being damaged by the financial crisis, Dinic says they are actually benefiting as the government pumps money into infrastructure projects to boost the economy and maintain employment levels.

For 2009 the Royal Commission has been given a budget of $880 million for construction contracts, a 35% to 40% increase in their previous annual expenditure, and Sabco is looking to bolster its workforce from 300 to 370 by the end of this year.

With a solid finance base and so much work going it is little wonder that the Royal Commission has at least 50 active contracts in construction at any point in time.

“They can go from small contracts such as 10 million riyals ($2.7 million) right up to 500 million riyals ($133 million) plus.

“For this year alone we’ve got a further 48 contracts forecast to be awarded.”

Dinic also  says he’s noticed a 25% reduction in the price of contracts due to an increase competition and falling building
material prices.

Likewise he says the private industrial developers are also in a good position to take advantage of the financial crisis.

“This is a good opportunity for anyone with a long-term vision to properly plan an industrial project so that when the demand comes back the industry will be there.”