Turkish and Chinese companies’ have long since made their renaissance in Qatar…

Qatar construction companies | companies in Qatar

Many large international contractors are jostling for overseas work amid shrinking markets in Europe and the U.S, at the same time as there has been a boost in activity in the Middle East and North Africa (MENA). Yet whilst some overseas markets offer great opportunity, competition between contractors is strong, with domestic companies also present in the sector as well. However, in Qatar’s very dynamic market, Turkish and Chinese companies have long since been operating successfully. This week’s QCR Special Report examines some key projects undertaken in Qatar by contractors from afore mentioned countries.

 

In the global construction market Chinese contractors are flourishing. A January 2014 report by the Chinese International Contractors Association (CHINCA) estimates the turnover for Chinese overseas contracted projects in 2013 as to US$ 137.14 billion, up by 17.6% year-on-year; and the value of newly-signed contracts as US$ 171.63 billion, up by 9.6% year-on-year. In Qatar, Chinese multinational giants such as China Communications Construction Company (CCCC) Group, Sinohydro, China Metallurgical Group Corp (5MCC), and China State Construction Engineering Corporation (CSCEC) are delivering large scale infrastructure projects. They are also some of the largest contractors in the world and exploring some of their specialist mega projects work in Qatar will highlight why.

 China Harbour Engineering Co Ltd (CHEC) is a subsidiary of CCCC and state that they currently have more than 100 ongoing global projects worth US$ 8 billion. CHEC was awarded an US$ 880 million contract for the first phase of the New Doha port project. This involved the excavation of material spanning 3.2 square kilometres and 18 metres deep, the construction of an 8 kilometres quay wall and 5 kilometre rubble break water. The New Port Project (NPP) released an amazing 6 minute animation video which shows the sheer scale of undertaking, which can be viewed here to get an idea of the megaproject.

CCCC is one of the top ten global contractors, with its subsidiary CHEC being the third largest dredging company in the world.

 

In October last year, the CCCC Group also sold port machinery to Qatar (their products entering the 84th country) through another subsidiary Shanghai Zhenhua Heavy Industries Company Limited (ZPMC), who are the world’s largest manufacturer of cranes and large steel structures. Before that in June 2013 the CHEC subsidiary was awarded a US$ 600 million contract by the Public Works Authority for the 2nd contract package of the East Corridor of Qatar. This project concerns the construction of a 10.75 kilometres highway from Doha New Industrial Area to New Hamad International Airport over a timeframe of 960 days. Infrastructure projects such as these demonstrate how Chinese companies in Qatar specialise in megaprojects and that they have become trusted partners in the delivery of such developments.

Ranked in 9th position for world contracting this year is the China Metallurgical Group Corp (5MCC) which specialises in engineering, procurement and construction (EPC) projects. 5MCC successfully completed the City Tower Doha and Qatar Tower. They were also awarded the contract for the Exhibition Hall in Doha and like the previous two undertakings this was a steel structure project (preferred to reinforced concrete, standard in Chinese construction). Also specialising in high-rise buildings China State Construction Engineering Corporation (CSCEC) constructed the Doha Tower (contract value US $ USD 117 million) and were ranked this year as the 3rd largest construction contractor in the world.

The Sinohydro Group have been in Qatar now for over 8 years and have been awarded several contracts in this time. Of note are the award of the Sidra Village Project valued at US$ 130million for the construction of 107 villas and associated structures and of course the US$ 1.4 billion contract for the Lusail Development Project. Here they are contracted for primary infrastructure involving the development reclamation and site preparation to construct the shoreline new islands, access channels and beaches, pipeline installation for water supply and drainage and road works. One of the company’s first contracts in Qatar was the important GTC 182 Water Project to increase water distribution in the West Bay area, Umm Slal and Alkhor. They were ranked this year as the world’s 14th largest contracting company.

Turkish contracting firm YUKSEL are also working on the Lusail Development project in a joint venture with Qatari firm MIDMAC. Similar to the Chinese multinational conglomerates, YUKSEL also specialises in large scale infrastructure projects. The company was established in 1963 in Ankara Turkey, first working on domestic projects before they began international contracting services in 1983. In the Lusail joint venture YUKSEL and MIDMAC received $460m from Al Khaliji Commercial Bank for work on the construction of the A1 and A6 highways, which comprises the southern and marina interchanges. The project will have a total road length of 5.2 km and is scheduled for completion early next year.

On 29 November 2013 in another joint venture with MIDMAC, YUKSEL initiated the completion process for their part of the Salwa Road reconstruction (6.8 km) which connects Doha to Saudi Arabia. The total value of this project reached US$ 458 million. The main roads and byways had already been delivered on 29 July 2013, however the project entailed extensive additional works including landscaping and access roads, the construction of 4 underpasses and signalized intersections plus level crossings on the road. Then there were the access roads and the 3-lane byways constructed on both sides. Parking lots were constructed to serve the shops on the road as well. Further, the whole electricity, water, sewage, drainage, purified waste water and telephone infrastructures were also renewed.

Another Turkish contractor Tekfen has completed motorway projects for Ashghal – the Primary Routes, NORTH ROAD PROJECT Phase 2 & 3 (US$ 480 million). The company entered Qatar in 2005 and have completed several projects. In addition to road works in Qatar, Tekfen have also delivered pipeline projects and were awarded a US$ 165 million contract by the Qatar Petrochemical Company (QAPCO) for the construction of a Low Density Polyethylene Plant.

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Turkish airport specialist TAV Airports Holding, are a leading airport constructor and operator whose 14.4 percent belongs to Goldman Sachs, is in charge of building the main terminal of the New Doha International Airport, or NDIA, which will have an annual capacity of 50 million passengers. TAV leads the joint venture with Japanese Taisei Corporation’s Sky Oryx JV.

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Nurol Steel, a subsidiary of Nurol Holding, recently completed the steel construction of Al Shaqab Academy at the Education City, where the Doha branches of six leading U.S. universities are based. The company is currently planning a $30 million investment in Qatar, with the support of a foreign partner. Nurol has a 51 per cent share in the framework of the investment. Nurol is also working on the Lusail Multi-Purpose Hall which will be one of the stadiums used for the FIFA World Cup 2022 in Qatar. Many other Turkish contractors have also been working in Qatar for a number of years, including projects logistics company Transtas Qatar W.L.L, Ekin Proje (Hamad International Airport), Troy Engineering and Samko International. There are about 50 major Turkish contractors currently operating in Qatar.

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As a whole the Turkish construction industry obtained a record $31.3bn worth of overseas projects in 2013, an increase of $5.2bn compared to 2012, according to the Turkish government. Turkish contractors secured 374 projects in 45 countries last year, Economy Minister Mr Nihat Zeybekçi said. Their success in Qatar – much like the Chinese companies, largely owes to infrastructure experience in home countries, before entering international markets respectively. This year at Project Qatar 2014, new companies from both China and Turkey will be exhibiting and no doubt are likely to continue the successful trend of winning contracts with appropriate local strategic partnerships.

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