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Arriyadh Development Authority (ADA) is looking for ways to dial down spending on the $22 billion Riyadh Metro project after it received instructions from the kingdom’s finance ministry to make the changes, Middle East Economic Digest (MEED) has reported.
The move comes amid fluctuating oil prices, which have put pressure on Saudi Arabia’s budget and spending plans.
The authority was said to be looking at two options: the removal of some of the non-critical elements of the design, and the extension of the project’s timetable by two years as a means of reducing annual spending.
The decision may increase uncertainty over other planned metro schemes in the country, with the Mekkah line seen as the most likely to be affected as there are still contracts to be signed
Finance minister Ibrahim al-Assaf recently spoke about the need to scale back on unnecessary spending and focus on key development and infrastructure projects.
Saudi Arabia has nearly $150 billion worth of non-hydrocarbon projects currently in the design or main-contract-bid phases, according to MEED Projects. Many of these schemes are expected to see delays or cost cutting, the project tracking website added.
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