Spanish company Acciona bullish on GCC growth amid rising oil prices

Spanish infrastructure company Acciona is optimistic about growth in the GCC region as governments invest heavily to build new projects amid higher oil prices, according to the company’s top executive.

With operations in 60 countries, the company is looking for new opportunities in transport, power and water and in the social infrastructure sector in the region, said Jesus Sancho, general manager of Acciona for the Middle East. The National on the sidelines of the World Utilities Congress in Abu Dhabi on Wednesday.

“There are many PPP (public-private partnership) projects where you can bring equity and co-invest with the government (in the region),” Sancho said.

“In the United Arab Emirates, sewer tunnels will be coming to Dubai very soon. In Qatar you will have a port, in Bahrain you will have King Hamad Causeway PPP.”

Saudi Arabia, the largest economy in the Arab world, is set to announce 24 PPP projects over the next two years, which include bridges, highways, toll roads, railways and ports that will deliver more opportunities for the company to bid for new projects, he said. .

Acciona recently participated in the completion of the extension of the Dubai Metro line to the Expo site as well as phase three of the Mohammed bin Rashid solar park.

“At this time, the total amount of contracts exceeds $3 billion in the GCC region in the areas of water, electricity and heavy civil works.”

Governments in the region are increasing infrastructure spending as oil prices rise due to supply issues. Brent crude, the global benchmark for two-thirds of the world’s oil, is up more than 30% since the start of this year after falling from a 14-year high, when it hit nearly $140 a barrel in March due to Russia’s invasion of Ukraine. .

Spain-listed Acciona has annual revenue of $10 billion and the GCC region accounts for $1 billion of the company’s total revenue, Sancho said.

“We want to double the region’s revenues to $2 billion over the next two years.”

“In Saudi Arabia there is a big transformation going on right now and they are investing heavily in a few select futuristic projects like Neom, Amala, Red Sea Development Company. civil engineering and transportation,” he added.

At present, the total amount of contracts exceeds 3 billion dollars in the GCC region in the fields of water, electricity and heavy civil works.

Jesus Sancho, CEO of Acciona for the Middle East

Saudi Arabia is building several projects as it focuses on diversifying its economy. These include Neom, a futuristic $500 billion city featuring a nature reserve, coral reefs and Red Sea heritage sites, and Qiddiya, a massive entertainment and sports project. The Red Sea Development Company is also building a mega tourism project on the west coast of Saudi Arabia.

Acciona also expects new opportunities as governments focus on reducing emissions to reach net zero goals in the coming decades. The United Arab Emirates, OPEC’s third-largest oil producer, aims to become carbon neutral by 2050. The country has 600 billion dirhams of investment in clean and renewable energy planned over the next three decades.

“The GCC is moving towards sustainable goals… towards decarbonization. We are also looking at green hydrogen and other projects.”

Updated: May 12, 2022, 03:45

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Margie D. Carlisle