Saudi and UAE Lead MENA in Awarding Contracts in 2023

Contractors in the Middle East and North Africa (MENA) region have secured more than $254 billion of contract awards in 2023 in a record-breaking annual tally, according to a report by regional projects tracker Middle East Economic Digest (MEED) Projects.

The previous record value of projects awarded in a single year was $240 billion, reached in 2014 when global macroeconomic factors had driven Brent crude oil prices above the $100-a-barrel mark, the MEED Projects tracker said.

“The fact that this value has been exceeded in 2023 when Brent crude is hovering around the $80 mark makes the record-breaking contract award sum all the more exceptional,” the report said.

The heightened activity was driven by extraordinary levels of contract awards in both the Saudi Arabian and UAE projects markets, which saw $92 billion and $78 billion in awards, respectively.

In Saudi Arabia, there has been a surge in project work under the Kingdom’s Vision 2030 giga project programme, as well as ongoing investment in energy infrastructure. In the UAE, a similar revival in construction activity alongside renewed investment in hydrocarbon exploitation has spiked awards, the report said.

Qatar was the next most active market with $19 billion in awards, led by the single-largest project contract of the year: the $10 billion QatarEnergy contract for two liquefied natural gas trains for the North Field South development awarded to the joint venture of France’s Technip Energies and Greece’s Consolidated Contractors Company.

The UAE’s Abu Dhabi National Oil Company (ADNOC) also signed two major gas contracts, both valued at more than $8 billion, for the onshore and offshore packages of its long-awaited Hail and Ghasha sour gas field development.

Many of the largest contracts in Saudi Arabia were also in the gas sector, led by Saudi Aramco’s award of the $2.9 billion package one and $2.2 billion package two of phase two of the commercialisation of unconventional resources (Cour) project at Jafurah.

Breakdown of Projects

Broken down by industry, the busiest areas of activity were construction, with $69 billion in awards, and gas, with $51 billion in awards.

Transport projects made up a further $33 billion in value for a total of $103 billion across construction and transport, while a further $21 billion of oil awards and $16 billion of chemical awards made for a total of $87 billion across the entire oil, gas and chemicals sector.

Power and water projects made up a further $57 billion-worth of awards, alongside $7 billion of other industrial projects.

“The 2023 awards value also surged well beyond the average value of annual awards in the past five years, which was $159 billion, and the $178 billion 2014-22 average annual award value,” the report added.