Over $45 billion worth of contracts were awarded to contractors during the January - April 2016 period in the GCC, according to construction projects tracking service Ventures Onsite.
“This is a 27 per cent decrease from the $62 billion awarded during the same period last year,” said Mibu John, partner and research director at Ventures Onsite.
Alba Sixth Potline Expansion (Bahrain), LNG Import Terminal in Al Zour (Kuwait), Sohar 3-Ibri Independent Power Plant (Oman), Jurassic Oil and Gas Reserves Expansion (Kuwait), and the Royal Atlantis Resort on the Palm (Dubai, UAE) are among the major projects awarded to contractors till date in 2016.
Some of the high valued contracts expected to be awarded in the next couple of months include Taiba Integrated Solar Combined Cycle (ISCC) power plant (Saudi Arabia), Dubai Metro - Route 2020 (Dubai, UAE), Saadiyat Island - Lagoons District (Abu Dhabi, UAE), Qatar power transmission system expansion - phase 13 (Qatar), Al Zour North IWPP - Phase Two power plant (Kuwait), and Umm Al Hayman wastewater treatment plant expansion (Kuwait).
The last 12 months witnessed over $30 billion worth of projects put on hold, said Ventures Onsite in its latest report, GCC Construction Industry Outlook 2016. This is in addition to the billions worth of projects that have been cancelled, it added.
“The unstable oil prices have led project owners to reconsider some of their planned pipeline of projects and activities for the future. However, despite cutbacks in overall expenditure, most GCC economies have retained spending on key sectors such as education, affordable housing, hospitality to promote tourism, and healthcare,” a statement from Ventures Onsite said.
The GCC construction contractor awards are expected to be still resilient in 2016. However, if oil prices do not recover in the near future, it is likely to affect the GCC construction industry in 2017, the report said.
With Expo 2020 and Fifa World Cup around the corner, the industry cannot afford to remain weak for long, it added.