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The UAE maintained its position as the second largest projects market in the GCC in 2Q 2024, accounting for 31.6% of total contracts awarded in the region, according to Kamco Invest’s GCC projects market update (pdf). The total value of projects awarded in the UAE stood at USD 16.34 bn during the quarter, down 23.6% y-o-y.
The construction sector awarded fewer projects: Project awards in the construction sector dropped by 62.9% y-o-y in 2Q 2024, with USD 4.4 bn in contracts awarded. The sector comprised 26.6% of total contracts awarded in the UAE during the quarter, down from 47.1% in 2Q 2023.
Other sectors also saw a decline: A total of six out of eight sectors experienced y-o-y declines in contract awards during the quarter, according to the report. The chemical sector logged no new project awards in 2Q 2024, compared to USD 3.6 bn last year.
Oil and gas were on the up: Project awards in the gas sector jumped over 6.5x y-o-y to USD 5.6 bn in 2Q 2024, while awards in the oil sector increased 5x y-o-y to USD 4.3 bn.
REMEMBER- Adnoc handed out USD 5.5 bn in engineering, procurement, and construction contracts in June for its Ruwais LNG project to a JV between engineering companies Technip Energies and JGC Corporation, and National Marine Dredging Company, after reaching the final investment decision for the project at an executive board committee meeting.
IN THE REGION-
Total project awards in the GCC fell 19.7% y-o-y to USD 51.7 bn in 2Q 2024, primarily due to the “unprecedented slump of project awards in Qatar coupled with steep fall in awards in the UAE,” and a volatile macroeconomic environment marked by regional instability and oil supply cuts.
Three out of six GCC countries saw y-o-y growth, with Saudi Arabia recording a 9.9% y-o-y climb in project awards on the back of an acceleration of Neom projects.
The outlook: The value of upcoming or ongoing projects in the GCC is at USD 3.5 tn as of the start of July, according to Meed Projects, with total upcoming GCC projects in the pipeline standing at USD 1.43 tn. Oil and gas projects are expected to “play a significant role in the GCC and MENA regions’ future contract awards,” with some USD 408 bn worth of planned and awarded for oil and gas projects in the MENA region.
Our pipeline: The UAE holds the second largest share of ongoing or planned GCC projects with USD 856.9 bn. The country comprises USD 291.4 bn (20.4%) of MENA projects in the pipeline, and USD 67.4 bn (16.5%) of planned and awarded MENA oil and gas projects.
