The document discusses the need for a regional integrated supply chain strategy to support major rail infrastructure projects across GCC countries. It notes that over $160-200 billion will be spent on planned railway projects, but there could be strategic resource shortages and skills gaps if the supply chain is not properly managed at a regional level. The document recommends conducting a study to identify critical resources, establish an approved supplier list, enable collective bargaining, and strategically place supply chain centers to support the large-scale railway development in a sustainable and cost-effective manner.
Regional Integrated Supply Chain Strategy for GCC Rail Projects
1. Project Overview
10 September 2014
Regional Integrated Supply Chain
Strategy for Rail
MENA Rail Summit
Dubai
5-7 October 2015
MENA Rail Summit
Dubai
5-7 October 2015
Presented by:
Eng. Mariam Ahmed Jumaan
Undersecretary, Land Transportation and Post
2. Bahrain GCC Rail Project – Summary of Progress
Project to be delivered in phases:
Phase 1: King Hamad Causeway between Kingdom of Saudi Arabia and Kingdom of
Bahrain
Feasibility and optimum alignment study is being led by KFCA with close co-ordination with KoB.
Feasibility study is now completed
Phases 2 & 3: Bahrain Station - Khalifa bin Salman Port – Qatar Causeway
Alignment in planning process, corridor requirements and land allocation being addressed
• Two alternative routes to the
north of the existing causeway
had been shortlisted
• Circa 20 km causeway
depending on the alignment
option chosen
• Rail only, rail plus road options
are being considered
• Approximately 2 million rail
journeys over the causeway
expected in the first year rising
to over 6 million by 2050
3. Future of Rail & Transport in Bahrain
Bahrain has a 2030 Strategic Plan which includes the
development of an effective public transport network
Several strategic level studies have been done to this
effect with transport network proposals which include
a form of light rail
First part of the transport network entered operation
in April 2015. Brand new bus network with a new
Operator
With GCC Rail Project in progress and light rail
projects being developed, Bahrain recognizes the need
to build rail skills capacity and develop a rail industry
supply chain
Compact size of the country will mean collaboration
with other member states and seeking mutual
benefit from economies of scale
4. Regional Integrated Supply Chain Strategy
Our Strategic Vision for the Sector
• Sustainable development of the Rail Industry
• Management of the process to ensure each country’s objectives are met
• Active encouragement of the private sector to invest in the rail infrastructure
projects and in the sector in general
Rail projects will play a vital role in diversifying the economies of GCC states.
Planned railway projects value is said to be around $160-200bn. We have an
opportunity to actively manage the formation of an integrated supply chain and
share the efficiency benefits that it will bring
5. Estimated size and scale of Rail Industry in GCC
UAE
KSA
Bahrain
Oman
Kuwait
Qatar
Railway Projects Market Share
0
10
20
30
40
50
60
70
80
90
Labour Rolling stock,
Materials & Plant
Consultancy and PM Corporate O/H &
Profit
$bn spent Projects Cost Distribution Scenario
0
5
10
15
20
25
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Estimated Railway Projects Spend
Profile by year
$bn
“Over 11,000 km of new
track to be constructed in
18 projects”
Source: Meed Reports 2013
* Estimates and analysis have been carried out from
projects information available on the public domain and
using industry norms for spend profiles
6. Brief summary of track materials estimates needed during
construction phase
Over 21,000 km rail
Almost 40 million sleepers
Over 22 million metre cube of ballast
Over 150 million clips, pads & nylons
8. Railway Industry, governance and supply chain web of
relationships
GCC Rail
Agency
National Rail
Authority
National Transport
Authority
Train Operator(s)
Infrastructure
Operator
Freight Operator(s)
• Rolling stock
maintenance &
servicing, spares
• Ticketing & retail ops
• Training
• Vehicle approvals
• Health & safety
• Rolling stock
maintenance &
servicing, spares
• Training
• Vehicle approvals
• Yard maintenance
• Asset Management,
Maintenance (civils,
pway, signalling,
electrification)
• Specialised plant
• Materials and spares,
Renewals
New Projects
• Design of
improvements
& new
schemes
• Tenders
• Contract
management
Other
Countries
National Rail
Authorities
9. Problem & Opportunity Statement
• Each Country, regardless of their size of their railway network, would need to
establish all components of the industry and have a supply chain capable and
available to service their requirements
• As far as we are aware, no specific study has been done to identify during both
construction and operation phases, any issues around availability of resources and
the capacity of supply chain
• Over 80,000 railway staff may be needed to operate the railway spread over a 2
million km2 area. We need a GCC wide strategy for building capacity
• If not managed proactively, there could be strategic sources shortage during
construction phase and skills gap during the operation phase. It is likely that GCC
nations will compete for the same resources creating inflation of costs
10. Opportunities
An Integrated and collaborative approach with active client participation
will ensure that a balanced, effective and adequate supply chain is formed
which can deliver great value for all authorities
Integration Ideas
• Approved Supplier List
• Establishment of Supplier Categories
• Criteria and performance based supplier selection
• Joined up approvals process
• Collective bargaining opportunities, economies of scale
• Sharing of resources –i.e annualized hire of strategic plant and allocation
• Joint training initiatives
• Strategic placement of supply chain
12. Strategic geographical placement of Supply Chain
-setting up specialised supply centres to encourage innovation
Country A
Country F
Country D
Country C
Country E
Country B
13. Summary & recommendations
• GCC is enjoying a railway boom and has the world’s attention. Railway based
transport projects are catalyst for growth and they will play a vital role in
diversification of the economies
• The scale of the concurrent railway projects in the region require a strategic
and joined up consideration of resources availability
• Whilst GCC Railway project has a joined up Masterplan which can identify
potential resource issues, this project still represents just a portion of the total
current projects
• A GCC and industry wide consideration of supply chain and resources
availability is needed
• A study looking at an overall railway programme for the region, investigating
critical resources and also recommending a sustainable and effective supply
chain will be useful
• There are many good examples of such as approved supplier lists and strategic
placement of supply chain which could be adapted at this early stage