Etihad Rail

[Name of the writer]

[Name of the institution]

 Abstract
Etihad Rail is one of the most complex infrastructure projects in the history of the United Arab
Emirates. This project aims to connect 6 GCC countries making cargo transportation easier,
reliable as well as cost efficient. The estimated budget of this project is about $15.4 billion
dollars. In order to get the positive and successful outcomes of this big project, it is mandatory
to utilise effective and efficient systems for managing project such as planning, decision
making and controlling etc. This project is will increase the image of the whole Emirate once
it is completed as well as it will make the trading more convenient through its exceptional
network which is expanded to 1200 kilometres. The main focus of this report is to assess and
evaluate the Etihad Rail which is an ongoing project in the UAE.
 Table of Contents
Introduction ................................................................................................................................ 1

Background ................................................................................................................................ 1

Evolution & Discussion ............................................................................................................. 1

Findings & Suggestion ............................................................................................................... 2

Conclusion ................................................................................................................................. 3

References .................................................................................................................................. 5
Introduction
In this case study, an ongoing project in UAE will be critically analysed. The analysis will be
conducted on the basis of certain societal criteria like social benefit and ethical standards. The
case study will also determine the time frame, budget, design phase, and potential risks
involved in the development of the project.
The project selected for this case study is the Etihad Rail, it is a 1200km ongoing railway
network project in the UAE. The project was started in 2009 and it is scheduled to complete in
by the end of 2018, the project is divided into three stages (Etihad Rail, 2017). The first stage,
of the project, is the 264-kilometer route and it will be used to transport sulphur from Shah and
Hasbshan to rest of the UAE. In the second stage, the railway line will be connected to the
Khalifa and Jebel Ali airport along with the Saudi and Omani borders. In the final stage,
the railway line from the city of Dubai to Fujairah, Ras Al Khaimah and Sharjah will be
extended up to 279km (Etihad Rail, 2012).

Background
The Etihad railway project is being developed in line with the UAE vision of 2021 Abu and
Dhabi economic vision 2030. This project is built by following the international standards, and
it aims to connect principal centres of trade, population and industry. The railway project will
act as a catalyst for sustained social development and economic growth in the UAE (Etihad
Rail, 2017). The Etihad railway is also a vital part of the GCC railway network, which aims
to link Saudi Arabia to Oman. In addition, the fleet of Etihad Rail of the trains will benefit
the environment by transporting the cargo at once which is done through 300 Lorries this will
make decrease a good amount of pollution from the environment as well as it will save the time
and money of the transportation.

Evolution & Discussion

The first stage of the Railway project was successfully implemented. The company has
accomplished their initial phase so far and successfully transported 4mn tonnes of sulphur from
the areas of Shah and Habshan to the port of Ruwais with the help of this project contracting
with ADNOC (Abu Dhabi National Oil Company) for exporting purposes (Bloomberg, 2016).
On the other hand, the implementation of stage two which aims to connect Khalifa Port and
Jebel Ali ports to the Saudi border at Ghweifat and the Omani border at Al Ain was halted
by the Etihad Rail and it did not affect the progress of stage one (Etihad Rail, 2012). According
to the chairman of Etihad Rail Nasser Alsowaidi, this project is one of the most complex

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infrastructure projects in the history of the UAE. He further stated that the project was delayed
because the partnerships in the project will determine its success. Therefore, the company is
screening the bids through a very careful process. The focus of the company is to select a
partner which can ensure the time and cost efficiency of this project. Nasser Alsowaidi
confirmed that as we enter 2016, we have been working closely with our partners and
stakeholders to assess our strategic priorities for the year. As a result, a decision has been
taken to suspend the tendering process for Stage Two whilst we review the most appropriate
timing for this investment (Gazzar, 2016). However, Etihad Rail planned to diminish their
workforce more than 30%, as Abu Dhabi seeks to trim costs after the slump in the oil. The
tendering of the second phase is in progress and it is estimated to be completed by the end of
the year 2017. It has been estimated that approx. 7 million tonnes of sulphur will be transported
through this railway network from the areas of Shah and Habshan to the port of Ruwais
contracting with ADNOS (Abu Dhabi National Oil Company) once the train line reaches full
commercial capacity every single year (Haider, 2016). Beside all these, the construction and
tendering process of the third stage will be initiated once the second stage is accomplished
successfully. The third stage will extend the network of Etihad Rail from the city of Dubai to
Fujairah, Ras Al Khaimah and Sharjah. The estimated length of this network would be
around 279km. Hence, the deadline for the completion of this project was 2018 which was set
upped by GCC however it might face delays. The budget of this project is about $15.4 billion
dollars. However, the estimated financial plan of Etihad Rail is described below:
Financial Plan

Power $4 Billion

Transport $1 Billion

Raw Material $6.8 Billion

Machinery $0.6 Billion

Fuel $1 Billion

Construction $2 Billion

Total $15.4 Billion

Table 1 Financial Plan of Etihad Rail Source: (Self-made)

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The above chart shows the breakdown of the budget of Etihad Rail of $15.4 billion dollars.
However, the cost of training and development, medical allowances are involved in the wages
which have the amount of $2 billion dollars. On the other hand, the cost of cement and other
ingredients are involved in the raw material. In addition, all kind of machinery from drill
machine to roller machine are included in the budget of machinery.
The tool or the technique which is used to identify the risk involved and the quality of the
project such as CPM (Critical Path Method). It is an essential method for Etihad Rail project.
Furthermore, the sponsor of this project is Abu Dhabi-based Al Jazira Sports Club.
If an I would be the Project Manager then I would suggest to pull in more sponsor as well as
contracting with other companies which could help us in overcoming the financial issues which
were the main cause for not continuing the construction of the second stage.

Findings & Suggestion

The project will be as efficient as it will reduce about 80% to 90% traffic involved for
transporting cargo on the roads as a single freight train can carry a load of up to 300 trucks
(Shahbandari, 2015). The estimated time for the completion of this project is by the end of
2018. The network of this project is expanded to 1200km connecting the whole emirates of the
UAE. It is based on three diverse phases as well as it will connect to GCC Rail network at the
borders with Saudi Arabia and Oman the most crucial benefit of this project is that Etihad Rail
will be only as loud as a vacuum cleaner which protects the environment in both ways, the
pollution and the greenhouse effect by reducing the emission (Bloomberg, 2016). On the other
hand, the risk behind this project was the investment that they have made in the initial phases
of the project that they have to cut down on 30% of their workforce in order to initialize the
development of the second phase as well as there were many other risks like security concerns
and disaster risk (DVV Media, 2017). In order to overcome those risk, the company
implemented strategies in their risk management process which was based on planning,
identifying, analysing and controlling the risks.

Conclusion
After reviewing the progress of the Etihad Rail project which is an ongoing project in the UAE
as well as assessing them and analysing the risk and the steps taken to cover them, it can be
concluded that this is another major step taken by the Emirati government for making their
trading and transportation convenient as well as efficient. It has several benefits which save the
time, money and the environment by diminishing the traffic from their roads. The step which

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was taken by the partners involved in this project was effective and saved the project from any
possible risk.

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 References
Bloomberg. (2016, January 17). Abu Dhabis Etihad rail cuts almost a third of its workforce.
Retrieved February 24, 2017, from http://gulfnews.com/business/sectors/automotives/abu-
dhabi-s-etihad-rail-cuts-almost-a-third-of-its-workforce-1.1655226

DVV Media. (2017, January 20). Etihad rail suspends stage 2 tendering. Retrieved February
24, 2017, from http://www.railwaygazette.com/news/infrastructure/single-
view/view/etihad-rail-suspends-stage-2-tendering.html

Etihad Rail. (2012). Etihad Rail Factsheet about Etihad Rail. Retrieved from
https://www.etihadrail.ae/sites/default/files/pdf/factsheets.pdf

Etihad Rail. (2017). Status of Etihad Rail Project. Retrieved February 24, 2017, from
https://www.etihadrail.ae/project/projectupdate

Gazzar, S. E. (2016, January 26). Etihad rail suspends progress on stage two network through
Abu Dhabi. Retrieved from http://www.thenational.ae/business/economy/etihad-rail-
suspends-progress-on-stage-two-network-through-abu-dhabi

Haider, H. (2016, January 26). UAEs Etihad rail stage two tendering process suspended.
Retrieved February 24, 2017, from http://www.khaleejtimes.com/business/energy/abu-
dhabi-suspends-stage-two-etihad-rail-tendering-process

Shahbandari, S. (2015, March 4). Phase 2 of Etihad rail on track. Retrieved February 24, 2017,
from http://gulfnews.com/news/uae/phase-2-of-etihad-rail-on-track-1.1466633