First of UAE rail contracts by year's end

Union Railways Company, the government-owned firm in charge of the estimated $11 billion (Dh40.40bn) United Arab Emirates railway, expects to award its first contracts by the end of this year, according to Richard Bowker, CEO at Union Railways Company.

He said that Union Railways will invite expressions of interest in the next two months. But a source from the company, who did not wish to be identified, told Emirates Business that this could mean as early as June. "We expect to invite expressions of interest in the next two months and suppliers will also be able to register through our website. The first phase will comprise the Shah-Habshan connection, which will first connect Ruwais to Habshan and finish in the first half of 2013. This will be immediately followed by the connection from Habshan to Shah, which will finish by 2014. We are already starting to look at the next phases. The whole project will take around seven to eight years," said Bowker.

"The aim is to award the contracts by the end of this year. The Union Railway will extend to Dubai and the Northern Emirates. Foremost, at the moment, are discussions to close the gap between Abu Dhabi and Dubai. We will also look at connecting with the rest of the GCC starting with Saudi Arabia on to Oman through Sohar. The preliminary surveys are underway and 80 per cent complete."

Bowker was speaking on the sidelines of the Middle East Rail conference organised by Terrapin. "Abu Dhabi National Oil Company (Adnoc) will be the first client and we are also in discussions with Abu Dhabi Gas Industries Limited (Gasco), Emirates Steel Industries, Borouge, Arkan as well as Khalifa Ports, Zonescorp, Ruwais Industrial Zone and Jebel Ali/DP World," he said. The 1,500 kilometre railway network will operate on diesel engines but can be converted to electric.

"We are looking at the design build model of contracts for the Shah-Habshan line since we are working to a very tight schedule and one that supports a schedule driven approach," he said. "Options are open as to how we look at the rest of the network in terms of contracts as well as phases. There is a lot of planning going on at the moment. We have been working with a number of experts such as Bechtel and the others and we will bring on resources as and when we need them."

He did not reveal any estimated values for the initial phase or for the financing. "The costs are commercially confidential since we are about to go through the procurement process. I want everyone to sharpen their pencils," he added. "We have not made any final decisions on the financing and will look at all options from equity and debt perspective as well as from export-credit perspectives. We are having exploratory discussions with financial institutions."