GCC project awards surged in Q2: Report

BUSINESS REPORTER

MUSCAT, JULY 19

GCC project awards surged 86% during Q2-2023 to reach $49.7 billion as compared to $ 26.7 billion in awards during Q2-2022 underlining the determination of the GCC countries to execute and reach their diversification targets, Kamco Invest reported.

The strong rise in the total value of project awards in the GCC is also a significant indicator of the health of the economies in the GCC region. This was the highest quarterly project awards value for over five years. All GCC project markets witnessed y-o-y growth during Q2-2023 except for Bahrain which remains the smallest project market in the region while Saudi Arabia remained the largest projects market in the GCC during Q2-2023.

Total value of contracts awarded in the Sultanate of Oman increased by 69.7% to reach $1.5 billion as compared to $871 million in Q2-2022 driven mainly y-o-y growth in the Oman’s power and gas sectors which reached $475 million and $728 million, respectively. Oman’s projects market is expected to witness significant growth during 2023. According to MEED Projects, Oman is expected to sign a $6.7 billion hydrogen contract with a consortium led by South Korean steel manufacturer, Posco.

In terms of sector classification, the gas sector witnessed the biggest increase in the value of projects awarded during the year recording $10.3 billion y-o-y increase in new contract awards to reach a total of $11.9 billion during Q2-2023.

Saudi Arabia’s project awards recorded 33.7% growth during the quarter to reach $24.4 billion as compared with $18.3 billion in Q2-2022. Comparatively, the UAE project awards jumped 127% to reach $12.2 billion during the quarter. Contract awards in Kuwait increased from $922 million Q2-2022 to $1.3 billion during Q2-2023, the second-highest project value in the last six quarters.

Saudi Arabia alone accounted over 49.1% of the contracts awarded in the GCC region during Q2- 2023, while Saudi Arabia, UAE and Qatar combined represented 94.4% of the overall projects in the GCC. Saudi Arabia’s growth in contracts during the quarter was mainly fueled by the continuous uptick of the number of Neom projects awarded during the quarter. According to

MEED Business Review, the Neom project awards in 2023 stood at $13.6 billion which surpassed the total value of contracts awarded in the Saudi capital Riyadh and Dubai which reached $11 billion and $9.3 billion respectively. The four major elements of the Neom project (the Line, Trojena, Oxagon and Sindalah) have already been launched and are already under construction.