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Orascom Construction, The Arab Contractors, and Germany’s Siemens Mobility have signed a contract with the Egyptian National Authority for Tunnels (NAT) to build the world’s sixth-largest high-speed rail network.
Orascom Construction is a global leader in engineering and construction, with active operations and investments in the Middle East, Africa, and the United States.
Nassef Sawiris, Egypt’s richest man, owns 28.97 percent of the group, or 33,825,323 ordinary shares, while OS Private Trust Company owns 51.8 percent of the Egypt-based contractor for the Sawiris family’s benefit.
According to the contract, Orascom Construction, Siemens, and The Arab Contractors will provide turnkey services to design, install, commission, and maintain the entire rail network for 15 years.
The 2,000-kilometer rail system, which will be built under the new contract with Egypt’s NAT, will connect 60 cities across North Africa, with trains capable of reaching speeds of up to 230 kilometers per hour.
The first 660-kilometer line of the 2,000-kilometer rail network will connect Ain Sokna on the Red Sea with Alexandria and Marsa Matrouh. The second line will run 1,100 kilometers from Cairo to Abu Simbel, while the third line will run 225 kilometers from Luxor in Upper Egypt to Hurghada on the Red Sea.
Egyptian President Abdel Fattah El-Sisi explained that the new electrified train network pays tribute to the strong level of cooperation in infrastructure between Egypt and Germany.
The recent announcement comes nearly one week after Orascom Constriction reported a profit of $15.3 million in the first quarter of 2022, down more than 43.1 percent from the $26.9 million in profit that it reported in the first quarter of 2021.
Despite a 20-percent increase in revenue from $816.6 million to $979.9 million, the group’s earnings power was hampered by a surge in direct costs above $880 million, combined with an increase in operating expenses during the period under review.
Osama Bishai, CEO of Orascom Construction, commented on the financial performance, stating: “We indicated in the previous quarter that we expected to experience challenges associated with the changing global economic environment.”
