Case Study

Intro

How the new cross border causeway was assessed, structured and positioned as a bankable regional connectivity project

The New Causeway Project was developed to strengthen connectivity between two GCC countries through a new 4-lane road causeway and a double-track railway, forming part of the wider GCC rail network. The project was designed to increase road capacity, introduce rail connectivity, support trade and logistics, and maintain long-term service levels between the two countries.

We supported the feasibility assessment by reviewing the technical scope, traffic forecasts, economic benefits, CAPEX/OPEX, PPP delivery options, demand risk allocation, legal feasibility and stakeholder responsibilities. The analysis compared stand-alone delivery against a bundled structure combining the existing and new causeways.

The study demonstrated that bundling the existing and new causeways created the most bankable solution. The preferred model combined a DBFOM road PPP with a DBF rail component, supported by availability payments, clear risk allocation and a security waterfall. The base case generated an estimated USD 2.01 billion NPV, 8.5% IRR, USD 5.4 billion cash benefit, and 12% equity IRR for the SPV, without requiring government financial support