Railway transportation is known to have several advantages over other means of transportation. Such advantages include the ability to move large volumes and sizes of materials according to a regular schedule and over long distances, comparatively low cost, safety, energy efficiency and low impact on the environment.
Railways projects are known to have high capital investments in the beginning but relatively low operation cost. Moreover, the longer the transportation distance and the larger the transported material, the more cost-effective railway transportation becomes. This means that the feasibility and economic success of major industrial and agricultural projects depend heavily on the availability of a reliable and cost-effective transportation system.
The geographical expanse of the Kingdom, the obvious economic benefits of connecting the different regions of the Kingdom by railways and the discovery of large mineral ores in different parts of the Kingdom; such as Phosphate deposits in Hazm Al-Jalamid north of Sakakah and bauxite deposits in Al-Zubayrah; northeast of Buraydah, made the expansion of the current railways network inevitable. Accordingly, the Ash-Shura (Consultative) Council made a recommendation to the government, in 1997, to study and evaluate the economic and social feasibility of expanding the railways network to cover other regions of the Kingdom.
Major international specialized consultancy organizations were put to the task performing a number of studies related to the subject. The most prominent among these, was the study carried out by the World Bank regarding the financial feasibility of expanding the railways network to connect Hazm Al-Jalamid, al-Zubayrah and Jeddah Islamic Port with Riyadh and to connect Dammam with Jubail Industrial City, leading to a network that connects the northern, eastern and western part of the Kingdom with its central region. The World Bank study was very supportive of these proposals and was endorsed by the related higher authorities in the Kingdom.
Accordingly, the Kingdom adopted a very ambitious program to develop and expand railways services in the Kingdom. Currently, this program includes three major projects; two of them were assigned to SRO while the third was assigned to the Ministry of Finance represented in The Saudi Public Investment Fund and the Saudi Arabian Mining Company (Ma'aden).
Benefits and impacts of the expansion program:
- Full and better exploitation of natural resources in the Kingdom of Saudi Arabia and launching the potentials and economic capabilities of the Kingdom to achieve sustained economic growth benefit the growing young population structure.
- Reduce depending on land roads and resulting in reduction of the high cost of road maintenance due to the movement of heavy transport to trains.
- Enrichment of the labor market through the provision of employment opportunities for graduates in different scientific and professional specialties required by the industry and the expansion of railway networks.
- Moving the wheel of the industrial growth, where the railway will contribute to the emergence of new industries that might arise with the integration of network such as mining industries, industry of transit and other heavy industries.
- Growth of the services industry owing to the expansion and the accompanying services such as insurance, maintenance, supply, construction and engineering services.
- Saving time and cost in the transport of goods coming from Europe and North America and destined to the domestic market and to the markets of the Gulf countries through unloading at the seaport of Jeddah, and then transported by train.
- Alleviating traffic congestion and participating in raising the level of road safety in areas that the railway passes, through providing an alternative means of transportation to passengers between the areas of the Kingdom, especially for the holy shrines areas.