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Wed 31 Oct 2007 01:33 PM

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Bids flying in for border fence deal

European firms EADS and Thales and US-based Raytheon among bidders to build Saudi-Iraq fence.

European firms EADS and Thales and US-based Raytheon are among bidders for a contract to build a border fence shielding Saudi Arabia from Iraq, documents obtained by Reuters show.

Saudi Arabia, the world's largest oil exporter, wants to build a razor-wire fence along the 900 kilometre frontier with its northern neighbour, with thermal imaging and radar equipment, Saudi officials told Reuters last month.

Groups of 14 local and international firms had submitted bids on October 28, according to a list of bidders obtained by Reuters and confirmed by three industry sources.

EADS, Thales and Raytheon were on the list along with Saudi Arabia's El-Seif Engineering & Construction and Al-Arrab Contracting, owned by Al-Rajhi Bank.

US defence electronics supplier DRS Technologies and South Korea's LG Electronics have also bid.

"There are several alternative options in the bids because of the complicated nature of the project," said an official at El-Seif, who declined to be identified. "It's difficult to say how much the project is worth."

Two other contractors said the projects would cost about 4 billion riyals ($1.07 billion), and was part of a wider defence plan to secure the country's 6,500 kilometres of borders.

Interior Minister Prince Nayef said last year the border fence had become essential because of escalating violence in Iraq, sectarian fighting and an insurgency against the US-backed government in Baghdad.

Saudi Arabia is planning to bolster border security by adding hundreds of radar facilities, coastal detection centres, telecommunications networks and reconnaissance aircraft around the country.

That plan, known as the MIKSA contract, is worth about 20 billion riyals ($5.33 billion), London-based weekly Middle East Economic Digest (Meed) reported last year.

France's Thales had been negotiating for 12 years over the MIKSA contract until the Saudi government decided to launch an international tender in April. - Reuters

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