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Sat 26 Sep 2009 04:00 AM

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Refined development

Saudi Arabia's second port has a very bright future and rich pickings for contractors.

Refined development
Yanbu is poised to be the next hotbed for construction.

Saudi Arabia's second port has a very bright future and rich pickings for contractors.

Although less well known than Makkah, Jeddah or Dammam, it looks highly likely that in years to come, Yanbu will be a major hotbed of construction within Saudi Arabia.

Yanbu's rise to prominence began in 1975 when the Saudi government designated what was then a small town to be one of two new industrial centres - the other being Jubail on the east coast. Since then, Yanbu has grown to be KSA's ‘second' port after Jeddah as an important petroleum shipping terminal. The city also acts as a port for the important city of Madinah.

As a result, the city of 250,000 provides some strong opportunities for construction projects relating to the petrochemical industry and its related infrastructure.

This summer, King Abdullah opened several projects in the industrial city, including the US $5.3 billion (SR20 billion) Yanbu National Petrochemicals Company, road and bridge projects worth $35 million and other developmental projects worth $533 million, all based in Yanbu 2 Industrial City.

He also opened a Sabic development, as well as a $800 million power capacity expansion. Meanwhile, a $3.7 billion desalination plant has been approved, and an expansion plan for the Prince Abdul Mohsen bin Abdul Aziz Airport has been launched.

Confidence in the future of Yanbu remains very high. "Jubail and Yanbu are very successful stories. When they were started in the 1980s everybody was saying ‘these people are crazy, don't bother doing it' - everybody was gambling about its failure and now everybody is talking about its success. It proved to be the right decision at the right time," says Saudi Arabia's deputy minister for town planning, Dr Abdulrahman Al Shaikh.

"I know there are some people who have their doubts about the success of the economic cities, but this is the nature of people. I believe they will prevail, because Saudi Arabia's economy and resources are sound, and if it is the will of the government to support it, then it will go on." Despite the economic slowdown, Yanbu appears to be a city getting back on its feet. At the end of June, Saudi Aramco and ConocoPhillips reopened the tender to construct a 400,000bpd refinery project in Yanbu, worth an estimated $12 billion. Bids need to be submitted by January 31.

Meanwhile, the current tenders list for the city indicates strong growth in the healthcare sector, with several health clinics and medical staff accommodation planned for the industrial city. Construction on the $12 million clinics package by Rezayat Trading began in Q1 this year and is expected to be completed by Q1 2011.

Top projects

Waterfront Development at Yanbu - Dredging Package: $100m

Expansion of Plaster Plant: $100m

Public housing   : $80m

Doctors' housing: $50m

Yanbu industrial College and Yanbu Technical Institute dormitories: $45m

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