Major transport projects in preparation for 2022 FIFA World Cup in Qatar

Guided by the state’s long-term economic development plan, Qatar National Vision (QNV) 2030, and driven by preparations for the 2022 FIFA World Cup, Qatar is investing heavily in infrastructure programmes focused on its non-oil and gas sectors.

More than $500m a week is being spent across all capital projects in the country in preparation for the upcoming games, with plans announced in December 2016 by Ali Shareef Al Emadi, the minister of finance, to invest up to $13bn in infrastructure projects in 2017, a figure that is expected to cover airport and port projects, as well as road upgrades.

Plans & Progress

A total of QR42bn ($11.5bn), or around 21.2% of the budget for the year, was allocated to transportation initiatives in 2017, with QR10bn ($2.7bn) specifically earmarked for rail projects, the new commercial port and road projects including the Lusail Road, Al Rayyan Road, Dukhan Road, the new ring road for trucks and the new Al Khor Road. As of February 2017 all projects that were under way in the country were progressing according to schedule, Jassim bin Saif Ahmed Al Sulaiti, Qatar’s minister of transport and communications, told local media. In the same month local media quoting Al Emadi reported that road projects related to the 2022 FIFA World Cup will be completed in 2017 and 2018, and 100% of drilling tunnel operations, along with 45% of stations, have been completed for rail projects.

Despite significant progress in the sector in 2017, the impact of the Saudi-led economic blockade has slowed work on GCC projects, and its impact on the Qatari economy could decelerate progress on major transport infrastructure projects, particularly those linking Qatar to other GCC countries.

The Ministry of Transport and Communications (MoTC) functions as the main regulator of the transportation sector, overseeing the work of individual transport operators and project owners. In collaboration with its government and private sector partners, the MoTC sets policies and formulates strategies that contribute to the development of transportation infrastructure. Government strategy is guided by the requirement to facilitate the movement of people and cargo, and provide a seamless multimodal public transport system that is integrated, accessible and inclusive for all citizens in the country. Meeting these requirements contributes directly to achieving the key economic, social, human and environmental development goals of QNV 2030.

Road Construction

A total of 30 road projects were being implemented in Qatar at the end of 2016, including improvements to link roads, intersections and tunnels, according to the MoTC. The largest road development programme is the multibillion-dollar Expressway Programme, focused on developing the country’s network of roads and bridges. It contains provisions for a total of 35 road schemes to be executed between 2010 and 2017, including a total of 900 km of mainline carriageway and around 200 km at grade and multi-level intersections.

One of the largest projects under the Expressway Programme, the QR3.26bn ($895.3m) Orbital Highway and Truck Route is planned to extend 195 km when finished, connecting Mesaieed and Hamad Port to the south of Doha with Al Rayyan in the west and Ras Laffan and Al Khor in northern Qatar.

Recent key road infrastructure developments include the January 2017 retendering of work for the $789m design and construction of Al Bustan North Road, also a key segment of the Expressway Programme, and the completion of the Al Rayyan Road upgrade project in June 2017.

Public Transport

The MoTC sets objectives for the transport sector that include encouraging the use of public transport to achieve resident ridership of 20%, in line with QNV 2030 and the Qatar Public Transport Programme (QPTP). Implemented by the Technical Affairs Department, the QPTP seeks to overhaul current bus services and provide a seamless travel experience by fully integrating with other Ridership figures for 2016 reached a high of 12.7m people, an increase of 19% over the 10.6m passengers recorded in 2015, according to local media. Mowasalat is the government-owned state transportation operator, working under the supervision of MoTC to expand the coverage of the public transportation network across Qatar. The company grew its public transit fleet from 120 to 250 buses between 2015 and 2016, covering 51 routes, with 17 areas allocated for developing bus-related facilities. Khaled Nasser Al Hail, CEO of Mowasalat, has previously announced plans to grow the fleet by 150-200 buses annually until the 2022 FIFA World Cup. The company aims to expand through six major bus stations and 16 depots, with 1000 buses and 7000 taxis on the road by 2020.

Integrated Systems

Mowasalat is also engaged in supporting the integration of current bus services with other multimodal transport systems planned for the country. In collaboration with local partners, the company will integrate feeder buses with the upcoming Qatar Rail System, covering all metro stations to create an integrated transport system.

Both Mowasalat and government-owned and operated Qatar Railways Company, known as Qatar Rail (QR), work closely with the MoTC on transport demand-management planning in a forum that meets every two weeks to discuss issues including physical integration, operational integration and ticket integration for the public transportation system.

The MoTC has been working on introducing a new unified public transport ticketing and fare system for the key operating partners of all public transport modes in the country, including the Doha Metro, the Lusail Light Rail Transit (LRT) and the long-distance passenger and freight railway, buses, maritime transport and taxis. In early 2017 it issued a tender for an integrated public transport ticketing and fare collection system to be managed by a new operating company under MoTC supervision.

Metro & Lrt

The Doha Metro project is expected to form the backbone of the capital region’s integrated public transport system, supported by other QR projects such as the Lusail LRT and the long-distance passenger and freight rail line.

Work on the Lusail LRT was progressing to schedule as of January 2017, with around 42% of the project complete as of December 2016, according to the QR Development Programme’s January 2017 media report. Planned works for the year included the forecast completion of Legtaifiya station in July, and ongoing civil works in 10 of the 11 depot buildings. Mechanical, electrical and plumbing (MEP) and architectural works are also ongoing in all seven underground stations, and architectural works are in progress in six at-grade stations.

According to local media reports, QR expects construction work on the first phases of the Lusail tram and Doha Metro to be completed between 2018 and 2019, with commercial operations scheduled to begin in 2020, two years prior to the staging of the 2022 FIFA World Cup in Doha. By that time, 37 Doha Metro stations across three lines – Red, Green and Gold – will be operational, with an average journey time of two minutes between adjacent stations.

Target dates envisaged for Doha Metro in 2011 remain unchanged, and a number of significant milestones were achieved in 2016, including the development of viaducts on the project in December, and the September completion of all 111-km phase-1 tunnel works on the Red, Green and Gold Lines. At the end of August 2017 overall progress on phase 1 covering all packages stood at 62%. Structural works have been finished on 11 stations, while MEP works were ongoing at 34 of 37 stations. Overall MEP progress was 18% complete as of end of January 2017.

The 2016 milestones were fundamental for the country to achieve its ambitious goals for 2017, which are focused on the more complex phase of installing tracks and the railway control systems, as well as the installation of MEP works, implementing architectural fit-outs, and awarding the contracts for rail and facilities management operations.

Long-Distance Rail

In addition to its work on Doha Metro and Lusail LTR, QR is also the lead authority for the design of a national rail network and the Qatar connection to both Saudi Arabia and Bahrain as part of the 2100-km GCC rail project.

Domestically, the country has long-term plans for construction of a national railway network to connect the north and western regions, but it is prioritising infrastructure development in the Greater Doha area, specifically the Doha Metro and Lusail LTR, ahead of the FIFA World Cup in 2022.

QR has also raised the possibility of building an intermodal freight yard at or near the new Hamad Port for break bulk cargo, container terminals and general cargo, but without a national freight network or movement on coordination among GCC partners, progress so far remains limited.

The first phase of Qatar’s contribution to the GCC network, running from Dammam in Saudi Arabia to Sohar Port in Oman with a spur to Qatar, is envisioned to include a 143-km rail line to Saudi Arabia’s border. QR floated tenders for a company to oversee the project in the summer of 2016, but later suspended the effort amid ongoing uncertainty regarding the project. An updated target of 2021 for completion of phase 1 of the Gulf Railway project was agreed upon following a ministerial-level meeting in October 2016.

No construction activity on the line has yet commenced in Qatar, and QR was in discussions in 2017 with the MoTC on a recommended way forward for the project based on the new agreed completion timeline of the fourth quarter of 2021.

Preparation work for environmental impact assessment tenders had been scheduled to commence in February 2017, subject to alignment approval for phase 1 on the connection point to Saudi Arabia. However, the short-term future of this project is uncertain in the face of the economic blockade put in place by Saudi Arabia, UAE and Egypt.

Air Links

Air transport in Qatar traces its roots to the 1950s, when local operators served mainly oil company requirements for carrying personnel and equipment. Now 60 years later, the aviation sector in Qatar is growing rapidly, fuelled in part by the growth of the national carrier and by the need to accommodate air transport traffic that will coincide with Qatar’s hosting of 2022 FIFA World Cup.

The country’s market share of GCC aviation capacity is predicted to increase by 17.1% by 2023, more than three times the expected capacity growth of the GCC region’s share of global aviation, according to a 2015 Oxford Economics report commissioned by air traffic management company NATS Holdings. Necessary infrastructure and capacity are also being bolstered, and coordination is being accelerated with authorities of civil aviation in neighbouring countries.

Key stakeholders in aviation include the Qatar Civil Aviation Authority (QCAA), established in 2001, and Qatar Airways Group, which includes state carrier Qatar Airways (QA), Qatar Aviation Services, Qatar Cargo and Qatar Aircraft Catering Company. In February 2017 Hamad International Airport (HIA) announced that it would operate as an independent entity under the Qatar Airways Group, having previously been operated by the national carrier.

Hamad International Airport

HIA was opened on April 30, 2014 with an initial capacity of 30m passengers per year. It has quickly become one of the fastest-growing international airports in the world. The airport was designed to replace Doha International Airport and elevate Qatar as a key regional and global aviation hub, attracting quality airlines and accommodating passenger and cargo air traffic increases in support of QNV 2030.

Passenger numbers at HIA jumped by 20% in 2016, when the airport handled some 37.3m passengers, according to officials. Aircraft movement recorded more than 16% growth, and cargo and mail shipments rose by 25% on the year, with cargo reaching 1.7m tonnes throughput and stretching the airport’s total capacity of 1.5m tonnes per year. This trend continued into 2017, with the airport reporting growth of 8% year-on-year in June 2017. However, in the wake of the economic blockade these numbers have fallen, with HIA seeing a decline of 5% in passenger numbers in August 2017 compared to the same period last year.

The surge in passenger numbers in 2016 significantly exceeded HIA’s initial design capacity. The airport was originally built to accommodate around 30m passengers. “Qatar’s efforts to become a recognised international aviation hub have already started to show results. With the synergy created by the collaboration between QCAA and QA, together with the visa-free entry for 80 nationalities, the state of Qatar has been able to expand its air reach and become more accessible to the world,” Abdullah Nasser Turki Al Subaey, chairman of the QCAA, told OBG.

To manage the increased numbers and mitigate ongoing congestion issues at immigration and security, HIA opened the north node to operations in 2016 and launched concourses D and E, adding eight contact gates and 130,000 sq metres of space, according to a February 2017 statement.

Advanced planning is now under way to boost the airport’s capacity to 50m passengers annually to accommodate the growth, and prepare for an estimated 86,000 passengers per day at the peak of the 2022 FIFA World Cup (see analysis).

As of April 2017 the project steering committee was working on preparing the HIA expansion plan, with a public tender inviting internationally contracted parties to take part in the phase-3 works expected to be launched at the end of 2017 or early 2018. Criteria and specifications will be released with the tender. When the project is completed in 2020, HIA is envisioned as one of the main gateways to the Middle East and the operational base for QA.

Fla G Carrier

Since the national carrier was established, its fleet has grown from four airplanes in 1997 to 191 aircraft, carrying over 25m passengers and serving more than 150 destinations worldwide, including 14 new destinations added in 2016.

In one of the year’s largest commercial airplane deals worldwide, QA and Boeing signed an $18.6bn contract in October 2016 for as many as 100 aircraft. The order includes 30 of Boeing’s 787-9 model and 10 of its 777-300ER jets, valued at a combined $11.7bn at list prices before discounts that typically accompany large aircraft purchases. The carrier also signed a letter of intent to purchase up to 60 of the narrow-body Boeing 737s valued at about $6bn at list prices. An order placed in 2011 for 50 Airbus A320neo and A321neo planes, with a combined list price value of $6.4bn, is still expected to go through, but issues with the aircraft’s geared turbofan engine have resulted in a decision by the airline to pivot to the rival Boeing model. All told, the airline has an order book of 300 aircraft valued at $70bn (see analysis).

QA is also expanding and opening air routes around the world, supported by the QCAA, which plays a key role signing new memoranda of understanding and service agreements, modernising existing agreements and working to secure new air traffic rights.

Sea Transport

Qatar is a peninsula country, almost entirely surrounded by water. Sea-borne trade is the primary mode of import, and the country’s ports have long comprised a major pillar of development. With the government seeking to develop Qatar’s logistics industry, and major infrastructure developments driving growth in maritime project cargo, the focus in 2017 was on further developing Hamad Port, one of the world’s largest port development projects and the country’s maritime gateway for trade. Strategically located in Umm Al Houl, south of Doha, Hamad Port is managed by QT erminals, a new entity jointly established in November 2016 by Qatar Ports Management Company (Mwani Qatar) and shipping giant Milaha (Qatar Navigation).

The first phase of the QR27bn ($7.4bn) maritime infrastructure project began full commercial operations in December 2016 and was running at about one-third of capacity in early 2017. The first of three container terminals is operational and capable of loading 2m twenty-foot equivalent units (TEUs) annually in the first phase, rising to a combined annual capacity of 7m TEU by 2020. Because Qatar’s own requirements are relatively small, the bulk of this capacity is expected to be oriented towards trans-shipment via ships. However, as its economic zones grow, Qatar’s export and import needs will also rise. An intermodal freight yard is also in early planning stages, though largely dependent on progress on the GCC rail network.

When the project is complete, Hamad Port will be home to three automated container terminals and at least eight super-post-Panamax gantry cranes. The port, which is already handling livestock imports, also has multi-use roll-on/roll-off, general cargo and bulk terminals, an offshore supply base, as well as coast guard and naval bases. The deep draft at Hamad Port is designed to permit larger container ships to travel directly to Qatar rather than docking at Jebel Ali in the UAE and transferring import cargo for Doha to smaller feeder vessels as was the case in the past.

The first weekly mother-vessel direct service was launched from Hamad Port in January 2017 by Mediterranean Shipping Company (MSC). MSC’s New Falcon service will connect the Qatari port with Shanghai, reducing the time that Qatari businesses are required to wait for goods from 45 to 20 days, and marking the beginning of the port’s trans-shipment capabilities. “From an operational perspective, Hamad Port is significantly more productive and accessible than Doha Port given its higher capacity and deepwater draft,” Abdulrahman Essa Al Mannai, president and CEO of Milaha, told OBG. “We have been consistently optimising and improving performance since the start of operations toward the end of last year.”

Doha Port & Al Ruwais

As Mwani shifted vessel operations to Hamad Port in late 2016, operations at the old commercial port in Doha – a gateway to the country since the early 1950s – began to wind down. By December 2016 all commercial vessel traffic had been transferred to Hamad Port. Doha Port continued to receive cruise ships until March 31, 2017, when the facility was closed to all vessels.

Qatar’s old commercial port will now undergo a major overhaul into a dedicated international cruise ship terminal as part of an ongoing push to attract more visitors to the country.

In late 2016 the MoTC announced that the first of two phases of the redevelopment work on Doha Port site – drilling and development – would commence in the second quarter of 2017 at a cost of QR2bn ($549.3m). The work involves upgrading facilities and dredging and deepening the canals in the areas adjoining the port to ensure the smooth arrival of large vessels, particularly cruise ships.

The MoTC is also working on completing the second phase of development at Al Ruwais Port in northern Qatar, expected to become operational as a commercial port in 2017. The development process, which commenced in 2014, will see the capacity of the port expanded to include a new storage facility and a market for selling the products of neighbouring countries.

Local Qatari firm Gulf Ferry announced plans in 2016 to operate a new roll-on/roll-off passenger and vehicle ferry service out of Al Ruwais, connecting the port to Khalifa Bin Salman Port in Bahrain in 2017. However, these plans have been put on hold in light of the recent economic blockade.

Outlook

Nine years after outlining QNV 2030 and five years prior to the 2022 FIFA World Cup, the government of Qatar remains firmly committed to transforming the country into a leading international logistics and transportation hub. Despite the ongoing low oil price environment, the state is progressing on schedule with its long-term infrastructure investment programme, funded from oil and gas revenues and accumulated budget surpluses, funnelling capital into the private sector and encouraging further development of the transport sector.

From major rail and expressway projects to the recent opening of the new commercial seaport and significant capacity upgrades at HIA, logistics flows and multimodal transportation networks are being developed at a remarkable pace. As these projects come on-line, they are reinforcing Qatar’s vast growth potential and paving the way for long-term expansion across all sectors, thus supporting ongoing efforts to diversify the economy, the priority of the QNV 2030.