Makkah Mass Rail Transit Company: An Easier Journey

December 6, 2017 in Transport

The Makkah Mass Rail Transit Company (MMRTC) are introducing a metro system for the city of Makkah, integrating the high demand of visitors with a capable efficient transportation system.

MMRTC have planned a four-line metro system with an integrated bus services: part of the 62bn riyal Makkah Public Transport Programme (MPTP).

The four new lines will coexist with the Al Mashaaer Al Mugaddassah Metro Southern Line, which is 18.1km long. The existing line connects Makkah, Arafat, Muzdalifa and Mina and only operates during the Hajj.

Each new line will create important links:

Line A will connect Makkah to large multi-level parking facilities from the west to the south.

Line B is a direct link between Makkah and Mina.

Line C will connect Mina to the west side of Makkah through a loop to the north.

Lastly, Line D circles Makkah, achieved with a straight extension to the north.

The Saudi government approved the US$16.5 billion to build the four metro lines back in 2012. The government have announced that the expansion will take 10 years.

The project began at a critical time: The number of worshippers, visitors and tourists to this holy city has increased exponentially, year upon year. An expansion will go a long way in improving passenger capacity. On speaking to the Business Year, Dr Osama Al-Bar, the Mayor of Makkah, explains:

“In 2015, we had six million overseas visitors for Umrah and about three million for the Hajj. We also had about 12 million visitors from inside Saudi Arabia. So, the total is around 20-21 million visitors. In 2016, the government is going to introduce a different approach. The number of Umrah visitors will be increased because now most of the infrastructure in Mecca can accommodate up to about 30 million. This means that from 2016 the real number of visitors from outside the Kingdom will increase by 50%. This is the government’s target. The city is ready, but the number of visitors we receive depends on the economic situation in other countries around the Islamic world, where our visitors come from. For example, Indonesia is one of the most important origins of pilgrims and is in a good economic situation, but if that changed it would affect visitor numbers.”

The Mecca Metro project has been one of many projects to expand the railway network in Saudi Arabia. Expansion has been fundamental for meeting transportation needs of the country’s growing population (25 million).

In addition, the project will improve an antiquated logistics infrastructure and bring the country into the foreground of modern transport.

The rail construction is now well underway: MMRTC have appointed Prasarana Malaysia to provide consultancy services during Phase 1. This covers the construction of two metro lines, amounting to 45·1 km track and 22 stations by 2019

Dr. Osama Al-Bar spoke to Business Year about the logistic, economic and social benefits of the Metro. He said:

“One of the benefits of the Metro Project is to ease the problem of traffic congestion, which currently causes a lot of lost time for the public. Other objectives are to reduce pollution, along with creating job opportunities. The project is expected to have a 2.2 benefit to cost ratio for investors, which is very high compared with other similar projects, based on a study conducted by Ernst & Young.”

A decline in Saudi Arabia’s public transport services over two decades has made it more difficult for families to access Makkah with ease. The Saudi government are now putting financial guarantees in place to reinvest back into public transport infrastructure.

The Mayor of Makkah said:

“There has been an absence of public transport in Saudi Arabia for the last two decades. In the late 1970s the first public transportation company, the Saudi Public Transport Co. (SAPTCO), was set up in Riyadh and was run by the government. Public transportation is something that must be subsidized—it is not a profitable business.”

“When the government subsidy disappeared about 20 years ago, public transportation service declined. For example, there is still no local SAPTCO service in Mecca.”

“Our current public transport project was started under the auspices of Al-Balad Al-Ameen, which is a private-sector company owned by the municipality. Before the start of project, the government had already invested about $2 billion in the Mashaaer metro system, an asset owned by the government. Therefore, we, along with the government’s company, entrusted that asset to the private sector and designed and executed the first phase of the metro network in Mecca. In mid-2012, when oil prices were increasing, King Abdullah bin Abdulaziz Al Saud approved the development of the rapid transit system in Riyadh and in the same decree he stated that all cities in Saudi Arabia could benefit from this program. Therefore, Mecca city applied with the consent of our local authority and the Ministries of Finance and Transport, and we received approval in 4Q2012 to start our program backed by the government’s financial guarantee. This enabled us to put aside our initial plan to proceed as a PPP project, and instead decided that this would be a turnkey project.”

The Mayor has clarified the involvement of the private sector for this specific project. He said:

“As we have the government’s decree that it will provide full financial support, the only involvement by the private sector now is contractual. There are various contracts; for example, Parsons Brinckerhoff won the project management office (PMO) contract. There are other contracts in the pipeline and about 10 contracts are yet to be awarded to the private sector, including two in civil works, one for rolling stock, and one in electromechanics. The bidding is already finished and we have nominated the successful companies and consortium. We hope to announce these contracts in 1Q2016 once we receive central government approval.”

The Ministry of Transport will increase private sector contribution to developing and operating railways by 50% in time for 2020.

In spite of successful bidding and watertight contracts, MMRTC had to contend with some delays, primarily due to the re-negotiations of funding. CEO of Makkah Mass Rail Transit, Ali Abdelfattah, addressed this at a conference in Dubai. He said:

“The reason for the delay is some restructuring financially”

However, the $17bn Metro development is going to enjoy an accelerated rate of work in the near future, because Saudi Arabia’s interest in big-ticket transport projects has returned. Vice-president of construction and business consultancy HKA, told local media:

“The government is moving to accelerate the rollout of the network, while also looking to secure alternative funding streams”

The railway infrastructure spending market in KSA is expected to grow at a CAGR of 7.88% from 2016 to 2020. The spending will cover modernisation programs as well as new developments.

Middle East Rail 2017 will host a series of interactive sessions that have been designed to introduce new innovative technologies to make the metro network modern.

The Makkah Metro is one of the key projects expected to be awarded to contractors in KSA market in 2017.

Jamie Hosie, the events director at Middle East Rail 2017, said:

“Operators are looking to source new technologies, educate their staff on best practices and find the perfect partners for 2017. There are a number of obstacles facing new rail projects apart from project finance, such as operational structures, technological expertise and political dynamics of cross-border networks. We have tailored a program aligned with the growing needs of the industry, providing an unrivaled platform for key players to come together to learn, network and discover new opportunities.”

“KSA government has prioritised several projects such as Riyadh Metro to ensure they continue as planned. The recent announcement that the Saudi government will be consolidating the two public transport entities Saudi Railway Organization and Saudi Railway Company, under the Saudi Railway Company name will ensure a unified vision for the Saudi Arabian national networks.”

The improved transit network will certainly have positive effects for the economy. The government expect to see an increase in productivity; faster commutes could not only reduce time lost by workers stuck in traffic, but also offer the potential for commercial and office developments away from existing centralised business hubs.

In addition, the metro will have an impact in tackling vehicular congestion in Makkah, whilst simultaneously helping the environment. The reduction of cars and the increase in public transport aligns with the Mayor’s vision for a ‘green’ city. He said:

“We hope that the first signs of Mecca’s transformation to a smart, green city will be evident by 2020.”

He concluded:

The extension of the Holy Mosque, development of new hotels and housing units, new infrastructure and upgrades to existing networks, the new railway network connecting Makkah with Jeddah and Medina, the local metro transit system, and the development of King Abdulaziz International Airport are all being synchronised to cater to the demand created by new visitors to Makkah and Medina.”

Once the metro is completed, the ebb and flow of people coming in and out of Makkah will be better supported.