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Qatar Construction Sector

1st Edition 2012

The Commercial Bank of Qatar (Q.S.C.)

Inspired by Qatar, we believe ever ything is possible

Foreword
Dear Investor, Qatar continues to be a magnet for investment due to its impressive economic performance in the face of continued global economic uncertainty. On the back of a strong GDP growth of 19% in 2011, decelerating to a forecast 6% in 2012, Qatars GDP would reach USD 197bn. Qatar also boasts the highest per capita income growth in the world, expected to reach USD 112k by 2016. This has led to Qatar witnessing a construction boom since 2006 (ongoing construction related contracts have tripled in value). Qatars successful bid to host the 2022 FIFA World Cup led the Government to plan for high levels of investment in infrastructure and real estate development - approximately USD 225 bn between 2011 and 2016, of which USD 125 bn has been unveiled for construction and energy projects alone. Spending directly related to preparations for the 2022 World Cup will amount to an estimated USD 80 bn, encompassing commercial and infrastructure projects and therefore the construction boom in Qatar is expected to continue, albeit with different priorities and involving new players. This sector report highlights the changing pace of the Qatari economy and construction sector segments in comparison with other GCC countries and provides detailed information on current projects and expected investments. For each industry segment, we present a proprietary summary timeline of key projects. To take into account the challenges, especially the tender phase and ramp up of projects, but also the opportunities for additional growth to be generated thanks to the improved infrastructure and expertise based in Qatar, we have designed several scenarios of investment in infrastructure and real estate; these scenarios are based on our proprietary model taking into account the expected timeline, phasing and costs of most known major construction projects. In the nal section of the report we provide summary proles of certain local and international companies which are actively participating in transforming Qatar. 2012 is, for most players, a year of preparation to take on new projects with new partners, new nancings and new clients. Investors in Qatar have therefore numerous opportunities to tap into the growth ahead, which creates new employment opportunities and continues to help position Qatar as a major economic force. Do not hesitate to call on Commercialbank for investment, strategic or nancing solutions; we are inspired by Qatar, we believe everything is possible. We hope you will nd our initial coverage of the construction sector of interest, in addition to Commercialbank Capitals future research publications.

Alex Carre de Malberg Global Head Commercialbank Capital

Dr. Abdulaziz A Al-Ghorairi Senior Vice President & Chief Economist Commercialbank Capital

We are inspired by Qatar and the entrepreneurial ambition of our founders, who believed everything and anything is possible. Constrained only by our imaginations, we apply our creativity and capability to help our customers full their goals. We aim to grasp the opportunities our vibrant and dynamic economy offers to serve our community better. Everything is possible is our promise. It is what we believe in and what drives everything the Bank does. Where theres a way, well find it.

Table of Contents
1. 2. 3. Executive Summary 1.1 Growth Drivers FIFA World Cup 2022: The Game Changer Challenges and Market size 3.1 Challenges 3.2 Construction Sector: Mapping market size under three scenarios Construction Sector Transportation 5.1 Roads 5.2 Railways 5.3 New Doha International Airport 5.4 New Doha Port ICONIC PROJECTS 6.1 The Pearl-Qatar 6.2 Msheireb 6.3 Lusail City 6.4 Seef Lusail Retail & Leisure 7.1 Doha Festival City (DFC) 7.2 Lagoona Mall 7.3 Katara 7.4 Cinemas 7.5 Hotels & Tourism Social Infrastructure 8.1 Education 8.2 Healthcare Energy and Utilities 9.1 Energy 9.2 Solar Energy 9.3 Utilities Building Materials 10.1 Cement 10.2 Steel 10.3 Aluminum Methodology and Assumptions Company Proles Abbreviations Disclaimer 4 7 9 12 12 12 15 18 20 23 26 28 30 30 31 32 33 34 35 35 36 36 37 40 40 41 44 44 47 47 52 52 55 56 58 59 86 87

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11. 12. 13. 14.

The Commercial Bank of Qatar (Q.S.C.) PO Box 3232, Doha, State of Qatar Telephone: +974 4449 0000 Facsimile: +974 4449 0070 www.cbq.qa

1. Executive Summary
April 2012 Commercialbank Capital Economic Research Dr. Abdulaziz A Al-Ghorairi Senior Vice President and Chief Economist Direct Tel: +974 4420 2663 abdulaziz.alghorairi@cbq.com.qa

Rajat Gupta, CFA Associate, Investment Banking Direct Tel: +974 4420 2627 rajat.gupta@cbq.com.qa

Qatars construction sector prospects seem increasingly bright following its successful bid to stage the FIFA 2022 World cup. The country is set to spend up to USD 150 bn on infrastructure projects over the next ve to six years in preparation for the World Cup. Budget: The Qatar government has reportedly allocated a signicant 40% of its budget between now and 2016 to infrastructure projects, including USD 11.1 bn for the setting up of a new international airport, USD 5.5 bn for a deepwater seaport, and USD 1 bn for a transport corridor in the capital, Doha. The government plans to spend USD 20 bn on roads, while stadium construction for the World Cup is expected to cost just under USD 4 bn, with the rst stadia venue to be built by 2015. According to German legal and nancial adviser Dr. Nicola Ritter, USD 48 bn will be spent to build air-conditioned stadia, USD 77 bn on facilities for soccer fans and players from across the world, and USD 33 bn for developing Lusail City. Qatar has also allocated USD 50 bn to upgrade its transport infrastructure, including new rail and metro systems. Qatar on fast track: Qatar has been one of the fastest growing economies in the world over the past few years (real GDP grew at a CAGR of 23% between 2003 and 2010). The countrys economy was the most resilient in the GCC region during the global recession, largely due to capacity expansion and government initiatives to spur the nancial sector. Visionary leadership: The Emir of the country has been instrumental in transforming Qatar into a power house within the region. In addition, the - Emir-led government has ensured political stability within the country, despite unrest in the other parts of the Middle East. The government has also allowed 100% foreign ownership in some sectors, and this is likely to improve liquidity in the form of Foreign Direct Investment (FDI). Qatars political and economic developments are both leading the country strongly along the path to achieving its Vision 2030. Diversifying strategy: the Qatar Government has put in place a well-planned strategy for long-term growth sustainability. The government initiated this strategy by focusing on its inherent strength, and increasing the export capacity of LNG. As this production-led growth peaks in 2012, the government is focusing on the non-hydrocarbon sector to push for post2012 growth. The accumulation of wealth from the hydrocarbon sector has been re-invested in diversify its revenue base. The wealth is re-invested through Qatar Petroleum in the hydrocarbon sector, and the Qatar Investment Authority (QIA) in the non-hydrocarbon sector. In the initial years of growth, the government re-invested wealth to acquire foreign assets. However, the government has now started focusing on investing domestically to provide a boost to the non-hydrocarbon sector. Dual Government funding and PPP model: Government spending has increased, as also the adoption of the PPP (Public Private Partnership) model in Qatar, especially in the hydrocarbon sector. According to National Development Strategy (NDS), the expected investment by the private sector is around USD 130 bn. Cheap lending as well as governments initiatives will boost the condence of the private sector, which will benet the construction sector and the economy in the long term.

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Exhibit 1: Key Projects

Madinat ash Shamal Al Khuwayr


9

Doha Cultural Village (KATARA) Project Value: USD 82 mn Refer: Section 7.3 Doha Festival City Project Value: USD 1.7 bn Completion Date: Q4-14 Refer: Section 7.1 Education City Project Value: USD 6.6 bn Completion Date: Q2-12 Refer: Section 8.1 Lusail Mixed-Use Project Value: USD 33 bn Completion Date: 2018 Refer: Section 6.3 Msheireb Project Value: USD 5.5 bn Completion Date: Q4-17 Refer: Section 6.2 New Doha Intl Airport (NDIA) Project Value: USD 11.1 bn Completion Date: 2015 Refer: Section 5.3

New Doha Port (Phase I) Project Value: USD 7 bn Completion Date: Q1-16 Refer: Section 5.4 Qatar National Museum Project Value: USD 434 mn Completion Date: 2014 Refer: Section 7.5 Pearl GTL Project Value: USD 6.6 bn Commencement in Q4-11 Refer: Section 9.1 Pearl Qatar Project Value: USD 5 bn Completion Date: Q3-13 Refer: Section 6.1 Sidra Medical and Research Center Project Value: USD 7.9 bn Completion Date: Q4-12 Refer: Section 8.2

Ras Laffan Industrial City

Al Khawr

2 11 3

4 10 1 4

10

Doha

Qatar

8 6

11

Source: Commercialbank Capital Research

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Exhibit 1.1: Key Projects in Doha

Source: Commercialbank Capital Research

1. Qatar National Convention Center Refer: Section 8 2. Doha International Airport Refer: Section 5.3 3. Museum of Islamic Art Refer: Section 7.5 4. Lagoona Mall Refer: Section 7.2 5. Lusail City Refer: Section 6.3

6. Msheireb Project Refer: Section 6.2 7. Qatar Foundation Refer: Section 8 8. Education City Refer: Section 8.1 9. Sidra Medical Refer: Section 8.2 10. The Pearl Qatar Refer: Section 6.1

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Exhibit 2: Segmentation of Construction Sector


Construction

Energy & Gas Utilities Oil & Gas Solar Energy Utilities

Transportation Roads Railways Airport Port

Buildings* Retail Hospitality Social Infrastructure

Source: Commercialbank Capital Research * Residential and commercial buildings are not covered in this report, except for iconic projects.

1.1 Growth Drivers


Robust macroeconomic environment Qatar has witnessed robust growth in GDP over the past few years, which is driven by signicant increase in LNG export capacity. According to IMF, Qatars economy grew by 19% in 2011, higher than 17% growth in 2010. In 2012, real GDP growth rate is projected to be 7.6%, with real hydrocarbon GDP slowing down to 3%, while non-hydrocarbon sector is expected to grow by 9.6%. Diversification at full stream The government launched the National Development Strategy (NDS) to achieve the targets of Vision 2030. The strategy is to leverage the hydrocarbon sector revenues to build the non-hydrocarbon sector and a more sustainable economic base. FIFA World Cup 2022 The Game Changer The successful bid to host the FIFA World Cup 2022 has been a big achievement for Qatar. The construction sector has since witnessed a spate of new project announcements. The government has also allocated USD 20 bn towards the development of the tourism sector. We believe that winning the bid for World Cup 2022 will be the main driver for the construction sector, as the government will remain committed to ensuring that projects are completed on time to host the world biggest sporting event. Well regulated and capitalized banking sector Recently, the government of Qatar has completed the two year capitalization program. In August 2011, the central bank has lowered its interest rates to kick start lending to private sector. The sector has optimum capital ratios that will enable them to extend lending to the construction sector in general and private sector in particular. Qatar eyes 2020 Olympics In 2010, Qatar won the bid to host the worlds largest sporting event, the FIFA World Cup 2022. The country is now on the path of creating history as it has been accepted as an applicant city to host the Olympics and the Paralympics in 2020.

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Exhibit 3: Key projects timeline


Barzan Gas Development Project Value: USD 9.4 bn Completion Date: Q3-16 Msheireb Project Value: USD 5.5 bn Completion Date: Q4-17 Lusail Mixed-Use Project Value: USD 33 bn Completion Date: 2018 Solar Power Complex Project Value: USD 1 bn Completion Date: Q3-18

Education City Project Value: USD 6.6 bn Completion Date: Q2-12 Sidra Medical Research Centre Project Value: USD 7.9 bn Completion Date: Q4-12 Pearl Qatar Project Value: USD 5 bn Completion Date: Q3-13

2011

2013

2015

2018

2022

Pearl GTL Project Value: USD 6.6 bn Commencement in Q4-11 Lagoona Mall Project Value: USD 348 mn Completion Date: 2011

Urjuan Mixed-Use Development Project Value: USD 10 bn Completion Date: Q3-14 Water Recycling Plant Project Value: USD 5 bn Completion Date: Q2-14 Doha Festival City Project Value: USD 1.7 bn Completion Date: Q4-14 Qatar National Museum Project Value: USD 434 mn Completion Date: 2014 Doha Dukhan Road Project Value: USD 1 bn Completion Date: Q4-14

Qatar National Railway System (Phase I) Project Value: USD 35 bn Completion Date: Q2-15 Qatar Entertainment City Project Value: USD 3 bn Completion Date: 2015 New Doha International Airport Project Value: USD 11.1 bn Completion Date: 2015 New Doha Port (Phase I) Project Value: USD 7 bn Completion Date: Q1-16

12 Stadiums Project Value: USD 4 bn Completion Date: 2020

Oil & Gas Cities

Energy Hospitality

Utilities Education

Roads Healthcare

Railways Stadiums

Airport Entertainment

Port Retail

Source: Commercialbank Capital Research

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2. FIFA World Cup 2022: The Game Changer


Qatars integral links with sporting activities in the recent past have resulted in the overall development of the country. The year 2010 can be marked as a year of extraordinary achievements for Qatar. In 2010, the country reached a milestone in its LNG production capacity, apart from winning the bid to host the largest football sporting event in the world. We believe that both these developments transformed the countrys future growth trajectory. Qatar has participated as well as organized several sporting events during the past few years. In January 2011, the country hosted the Asian Football Confederations (AFC) Cup for the second time. In addition, Qatar hosted the 2006 Doha Asian Games, which will help in the planning and implementation for the 2022 event. Exhibit 4: List of major events organized by Qatar in the past two years Events Arab Boxing Championship For Men Qatar Int. Endurance Race Grand Prix Men and Women Fencing Tournament AFC Cup of Nations Commercialbank Qatar Masters 2011 Sail the Gulf-2010 Exxon Mobil Open Tennis Championship 2011 Qatar Int. Table Tennis Championship Qatar Athletics Diamond League Asian Clubs Basketball Championship World (9) Balls Billiard Championship Qatar 10th Int. Open Bowling Championship International Grand Prix and Golden Shirt Cycling Championship 1st Int. Women Handball Championship World Clubs Handball Championship World Formula Sailing Championship Qatar Classic Squash Championship 2010 GCC 4th Women Table Tennis Championship Arab Wrestling Championship Commercialbank Qatar Moto GP
Source: Qatar Tourism Authority

Sport Boxing Endurance Fencing Football Golf Sailing Tennis Volleyball Athletics Basketball Billiard and Snooker Bowling Cycling Handball Handball Sailing Squash Table Tennis Wrestling Motorbike

Frequency Yearly Yearly Yearly 4 years Yearly Yearly Yearly Yearly Yearly Yearly Yearly Yearly Yearly 2 Years 2 Years Yearly Yearly Yearly Yearly Yearly

Year 2011 2011 2011 2011 2012 2011 2011 2011 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2010 2012

Winning the bid for the World Cup 2022 has been an extraordinary achievement, as it is one of the biggest sporting events in the world. Qatar is the rst country in the Middle East to get this honor. According to ofcials, the FIFA World Cup is expected to draw around half a million visitors, almost a third of Qatars current population. The impact of Qatar winning its bid for the 2022 FIFA World Cup would be profound for the state, its people and the region. The dynamic vision of both, HH the Emir, Sheikh Hamad bin Khalifa Al-Thani and HH Sheikha Mozah bint Nasser AlMissned has resulted in economic developments that has transformed Qatar internationally. In addition, this has resulted in successfully winning the bid to host World Cup 2022, which is laudable from all aspects. According to reports that the FIFA World Cup in South Africa had added between 0.5% and 2.2% to the countrys GDP (depending on which infrastructure projects one considers); and overall had created in excess of 300,000 jobs since 2006 - a 2.7% contribution to employment gures. We believe that the impact of the World Cup 2022 preparations will be much larger on the GDP of Qatar compared to other countries that have hosted the event in the past.

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Aspire: Venue for Asian Games in 2006

Aspire Academy for Sports Excellence was founded in 2004 by HH Sheikh Jassim Bin Hamad Al Thani, to create a worldclass institution for educational sport that would develop athletes in Qatar. Worldwide, Aspire is known for its state-ofthe-art sports science, and produce graduates who would become Qatars most admired civic leaders. It covers an area of approximately 290,000 sqm. Aspire has an enviable list of world-class sporting facilities, including a 200m athletics track, an Olympic-sized swimming and a diving pool, a gymnastics hall, two multi-purpose sport halls, table tennis courts, fencing strips, squash courts, a bespoke goalkeeping training area, and tness rooms. Aspire has an astonishing eight full-sized football elds, including an international standard articial grass indoor pitch. The Academy also has 20 classrooms for subjects ranging from English language to Physics and Biology. Aspires dormitory has 128 rooms and eight suites, which can house up to 255 students. Currently, there are approximately 200 student athletes, in grades 7 through 12, who specialize in football, athletics, squash, table tennis, sailing, judo, gymnastics, swimming, tennis, fencing, rowing, shooting and golf. Aspire has a team of over 300, including instructors, trainers and educators of different nationalities. The iconic Aspire Dome has the capacity to host 10 different sporting events simultaneously in a climate-controlled arena, making it the largest multi-purpose sports facility of its kind in the world. It has 13 sports venues and seven performance enhancement laboratories under the same roof. It can seat a total of 15,000 spectators. Aspetar is the rst specialized Orthopedic and Sports Medicine Hospital in the Gulf region, situated within the Aspire zone. It provides high-quality medical treatment for sports-related injuries in a state-of-the-art facility, staffed by some of the worlds leading sports medicine practitioners and researchers. In 2009, Aspetar was ofcially accredited by F-MARC as a FIFA Medical Centre of Excellence. Aspetar provides a full range of services from injury prevention to injury management and performance improvement.

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Qatars World Cup stadiums


0 km 30

1. Lusail Iconic Stadium

2. Shamal Stadium

3. Al-Khor Stadium

Madinat al-Shamal

Al-Khuwayr

Ras Laffan
Location: Al-Daayen Capacity: 86,250 Value: USD 662 mn Matches planned: Opening match, group matches, and round of 16, quarter-nal, semi-nal and nal 4. Al-Wakrah Stadium Location: Al-Shamal Capacity: 45,120 Value: USD 251 mn Matches planned: Group matches Location: Al-Khor Capacity: 45,330 Value: USD 251 mn Matches planned: Group matches and round of 16

5. Al-Rayyan Stadium

6. Doha Port Stadium

Al-Khor
3

Al-Jamaliyah

12

Umm Salal
1

Lusail

han

QATAR
Al-Rayyan
5

Location: Al-Wakrah Capacity: 45,120 Value: USD 286 mn Matches planned: Group matches and round of 16 7. Education City Stadium

Location: Al-Rayyan Capacity: 44,740 Value: USD 135 mn Matches planned: Group matches 8. Qatar University Stadium

Location: Doha Capacity: 44,950 Value: USD 202 mn Matches planned: Group matches, round of 16 and quarter-nal 9. Al-Gharafa Stadium

Doha

Umm Bab

Al-Wakrah
Location: Al-Rayyan Capacity: 45,350 Value: USD 287 mn Matches planned: Group matches and round of 16 10. Sports City Stadium Location: Doha Capacity: 43,520 Value: USD 300 mn Matches planned: Group matches and round of 16 11. Khalifa International Stadium Location: Al-Rayyan Capacity: 44,740 Value: USD 135 mn Matches planned: Group matches 12. Umm Salal Stadium

Mesaieed

Abu Samrah

Location: Al-Khor Capacity: 45,330 Value: USD 251 mn Matches planned: Group matches and round of 16

Location: Al-Rayyan Capacity: 68,030 Value: USD 71 mn Matches planned: Group matches, round of 16, quarternals and semi-nals

Location: UmmSalal Capacity: 45,120 Value: USD 251 mn Matches planned: Group matches, round of 16 and quarter-nals.

Source: MEED

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3. Challenges and Market size


3.1 Challenges
The prospects of Qatars construction sector are bright, underpinned by signicant investment by the government over the next decade. Despite the bright outlook, Qatar is likely to face certain challenges as it prepares for the FIFA World Cup 2022. The government will continue to remain under pressure to complete the projects on time to meet the deadlines and guidelines set by the FIFA authorities. Global slowdown Qatar is not completely immune to the global environment; therefore, uncertainty around the global economies will have a limited impact on Qatar in general, and the construction sector in particular. The global slowdown will impact private sector participation, as the credit environment becomes tighter and more difcult in such scenarios. In addition, hydrocarbon prices will decline, having a direct impact on Qatars GDP, resulting in lower growth. We believe the government of Qatar will continue to step in with support to ensure projects are completed on time in case private sector participation deteriorates. Shortage of skilled/unskilled labor The shortage of both technical staff and labor will continue to one of the biggest challenges for the sector. These projects require people who have applied similar principles to creating efcient, cost effective, high tech systems in other countries like Germany, Ireland and Australia. The companies operating in the construction sector have learned from their previous experience (the Asian Games); however, the scale and magnitude of the projects for the World Cup 2022 will be a whole new experience for both the companies, as well as for Qatar. Shortage of schools for children and the lack of a well-publicized clampdown on alcohol in Doha are some of the other problems that are currently being resolved. Shortage of raw materials The construction sector is likely to witness shortages in raw materials between 2013 and 2017, as the period is expected to be the peak for the sector. The government will ensure that the shortages in raw materials do not lead to unexpected rise in prices. Both of these factors will lead to delays in execution of the projects. Therefore, the sector will have to bridge the gap during this period by mutual agreements with the companies in Saudi Arabia and the UAE.

3.2 Construction Sector: Mapping market size under three scenarios


The indicators for the construction sector outlook look solid, as much of the investment is backed by government or semi-government entities. The news of Qatar hosting the FIFA World Cup 2022 has further brightened the outlook of the sector. The rapid increase in population over the past few years has resulted in increasing demand for infrastructural development in Qatar. All these factors will collectively lead to ample opportunities for construction activity in Qatar. Within the construction sector, we remain buoyant on the transportation, retail and hotel and tourism sectors. The transportation sector is the biggest beneciary of the massive investment by the government, as it plays a vital role in the infrastructural development of the country. The improvement in the transportation network will also be essential as the country prepares for the FIFA World Cup 2022. The tourism authority of Qatar has done a commendable job over the past few years by organizing and participating in conferences and exhibitions. This has resulted in the inux of tourists, thereby boosting the hotel sector. The rapid increase in population, as well as inow of tourists, will boost the retail sector. As a result, the country is witnessing massive investments in shopping malls to address the shortages in the retail space. We have forecasted the Qatar construction sector market size until 2020, as we believe that the majority, if not all the projects will be completed by the end of the projected period. We have assumed USD 225 bn investment as our base for total investment, which is provided by the NDS. Based on our assumptions, we have assumed additional investments in the construction sector as a percentage of the GDP. The additional investments have been assumed in two phases, the rst phase will be from 2013 to 2017, while the second phase is from 2018 to 2020.

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The following is a brief summary of the methodology adopted to arrive at the market size: 1. Initially, the list of projects ongoing and planned was compiled from various relevant sources. However, we decided to take data from one source due to inconsistency from various sources. This data was further classication as per the construction sector. The value of each project was divided in quarters based on the completion date to arrive at the actual value invested in a particular year until 2020. 2. We have assumed additional investments between 2013 and 2017 based on the announced investments of USD 225 bn by NDS. 3. Finally, we have assumed a percentage of the GDP that will be re-invested in construction to further upgrade the infrastructure sector. The forecast for GDP is taken from IMF until 2016. This constant rate as a percentage of GDP has been differentiated based on two phases, the rst from 2013 to 2017 and second from 2018 to 2020. In order to arrive at the total market size, we have added the contributions from three approaches as described above. This methodology was adopted to build three scenarios in our analysis to arrive at a market size. In each scenario, contribution from rst two points remains the same while contribution from third point varies for three different scenarios:
Best Case In this case, we have assumed a higher percentage of GDP that will be invested over and above the planned investment by the government. Based on this assumption, we arrive at a market size of USD 315 bn. In this case, we have assumed a lower percentage of GDP that will be invested over and above the planned investment by the government. Based on this assumption, we arrive at a market size of USD 270 bn. In this case, we have made two assumptions. First, we have assumed that there will no additional investment and secondly we have assumed that around 15% of the planned projects will be cancelled going forward. Based on this assumption, we arrive at a market size of USD 191 bn.

Base Case

Worst Case

Exhibit 5: Spending patterns based on different scenarios forecast (USD bn)


350 300 250 200 150 100 50 2012 Base Case 2015 Worst Case 2018 Best Case 2020 34 188 170 138 185 284 249 270 NDS: USD 225 bn 191 315

Source: NDS and Commercialbank Capital Research

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Major Projects
AIRPORT New Doha International Airport (NDIA) will be able to handle 24 mn passengers per year and will have 42 contact gates, six of which will be dedicated to the Airbus A380 superjumbo. When construction started in 2004, the new airport was scheduled to open in 2008. It is now planned for an opening in December 2012. The new terminal is being built by the Sky Oryx consortium of Japans Taisei Corporation and Turkeys TAV. The terminal extension is being built by a joint venture of Belgiums Six Construct and the local Midmac Contracting. PORT New Doha Port is to be built at Mesaieed, south of Doha and will replace the existing Doha Port downtown on the citys Corniche. The new port will support industrial development to the south of Doha. Completion of the rst phase is expected in 2014. Beijing based China Harbour won contract to execute the onshore excavation works. Firms have been prequalied for the contract to dredge the ports approach channel. STADIUMS As of now, Qatar has committed to spending USD 65 bn to build infrastructure to host the 2022 World Cup. As part of the bid process, Qatar committed to providing 12 stadiums, each with a minimum capacity of 45,000. The direct spending on building stadiums will be 4% of the total planned investment. It will renovate three stadiums and will construct nine new stadiums. Stadiums will be equipped with cooling systems using clean renewable energy resources to achieve the rst completely carbon-neutral World Cup. RAIL Doha Metro is the rst section of Qatars USD 25 bn rail plan to be developed and will be a crucial part of Dohas infrastructure when complete. The metro will consist of four lines running more than 300 km across the city. The rst phase involves building the Red line, which will run from Doha city to new Doha International airport. In 2009, Germanys Deutsche Bahn was appointed to develop Qatars national railway network. It is currently prequalifying consultants for the preliminary metro designs.
Source: MEED

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4. Construction Sector
Qatar has two main focuses in the next decade; rst is staging the largest sporting event, and the second is implementing its National Vision 2030, which aims to diversify away from a reliance on hydrocarbons. Qatars ambitions and investment plans are different compared to other GCC countries. Qatar won the right to host the 2022 World Cup, which has imposed a time frame for completing the projects. The infrastructure that the country will build over the next decade will also result in meeting the objectives of the national development plan. Preparing for the World Cup 2022 will drive spending on sports and transport infrastructure, while the National Vision 2030 will focus on social infrastructure, such as education, healthcare and cultural projects. Qatars construction sector witnessed unprecedented growth between 2005 and 2008, growing at a CAGR of 46%. Sector productivity increased from QAR 8.7 bn in 2005 to QAR 27.5 bn in 2008. Following this, the construction market contracted in 2009 and 2010 on the back of the global crisis. According to a study by Oxford Economics and Global Construction Perspectives, the Qatari construction market is expected to grow by an average of 12.5% a year over the next decade, compared with growth in European countries averaging just 1.7% to 2020. The sector has not witnessed any major cancellations or projects on hold, unlike its regional peers, including Dubai, Bahrain and Kuwait. The total value of projects put on hold or cancelled stood at USD 460.3 bn at the end of October 2011. In Qatar, the projects put on hold were around 4% of the total market, compared to 59% and 24% in UAE and Kuwait, respectively. The value of such projects in Qatar and Saudi Arabia was insignicant compared to the total size of the market. With Qatar slated to host a zero carbon World Cup in 2022, Qatar Green Building Council (QGBC) has set up a group to foster green infrastructure as a national resource. Qatar is utilizing Leadership in Energy and Environmental Design (LEED) and the Qatar Sustainability Assessment System (QSAS) to this end. A number of projects are targeting LEED Gold or Platinum status. Dr. Alex Amato, Chairman of the Research and Innovation Committee at QGBC, commented: In line with the environment pillar in Qatars National Development Strategy 2011-2016, this interest group complements national and regional efforts to utilize our current and future green infrastructure. This initiative demonstrates the value of green infrastructure investment and reiterates the benets and need for sustainable investment in this eld. This group also wants to encourage the appreciation of Qatars natural systems and their role in the landscape architecture profession. Exhibit 6: Construction sector as a % of non-hydrocarbon GDP in Qatar
30.0 27.2 25.0 20.0 QAR bn 15.0 10.0 5.0 0 2007 2008 2009 2010 9M-11 Building and Construction As % of non-hydrocarbon GDP 15.9 14.4% 13.0% 11.4% 11% 10.8% 9.1% 9% 7% 5% 25.5 24.1 21% 19% 17% 17.6 15% 13%

Source: Central Bank

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Exhibit 7: GCC - Projects planned or underway (2008 2011)


1,250

1,000

USD bn

750

500

250

Bahrain

Kuwait 2008

Oman 2009 2010

Qatar 2011

Saudi Arabia

UAE

Source: MEED, Note: Oct end for each year

The total number of projects that were planned or underway in the GCC stood at USD 1,784.7 bn at the end of October 2011. Saudi Arabia has emerged as the largest market for planned or underway projects in the GCC, while UAE became the second largest market because of cancelled or on-hold projects. Qatar has been in the limelight for various reasons from acquiring international assets to hosting the biggest sporting event in the world. The total number of planned and underway projects in Qatar stood at USD 214 bn at end of Oct-2011. The value of projects has grown at a CAGR of 40% during 2005 and 2011. The growth in projects value during the period is the second largest in the GCC, as Kuwait witnessed a growth of around 43% despite all the cancellations/on hold projects. The value of the projects under execution stands at USD 59.8 bn with the transportation sector accounting for around 30% of the projects under execution. Within transportation, airport and roads have been the main contributors as they are witnessing a substantial revamp or new additions in facilities. As of Oct-2011, the total value of projects under execution in Qatars energy sector stood at USD 11.2 bn accounting for 19% of all the projects under execution in the country. This indicates that the worlds leading supplier in the hydrocarbon sector has been capitalizing on its core sector to meet the rising global demand in the oil and gas sector. Furthermore, commercial and residential construction projects accounted for 21% of the total projects under execution. Exhibit 8: GCC - Projects planned or underway till Oct-11 (USD bn)
55.5 167.9 111.6 605.4 214.0 Bahrain Kuwait Oman Qatar Saudi Arabia UAE USD bn

Exhibit 9: Projects planned or underway in Qatar


30.0 25.0 20.0 15.0 116.4 10.0 5.0 145.3 202.8 204.3 254.9 214.0

630.3
0

28.2 Oct-05 Oct-06 Oct-07 Oct-08 Oct-09 Oct-10 Oct-11

Source: MEED Projects

Source: MEED Projects

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Exhibit 10: Projects under execution (Oct-11)


Others Stadiums Social Building Retail Tourism Utilities Energy Transportation 1.7% 2.7% 12.6% 18.7% 30.7% 0.0% 9.6% 21.2% 2.7%

Source: MEED Projects

Sporting events in Qatar have also been one of the main drivers of the construction sector. The 15th Asian Games were held in the country in 2006 and the preparation for the games resulted in a great deal of construction activity, including the building of a Sports City, which contains stadium and other sports facilities. In January 2011, the country hosted the Asian Football Confederation Cup for the second time. The biggest driver and the game changer for Qatar has been its winning bid to host the football World Cup 2022. Transportation and building projects account for more than 50% of the projects under execution. These sectors are essential for the infrastructure development of the country. The transportation sector is focusing on modernizing its existing network, while the building sector is transforming the country by building some iconic projects over the next decade. The country is building several start-of-art projects that will transform the country. As seen in Exhibit 11, the total spending in the construction sector stood at USD 47.7 bn, accounting for 39% of the total spending. In the construction sector, 48.3% was allocated towards the residential and commercial sub-sector, while 10.7% was in industrial and 12.1% in ports. Exhibit 11: Sector wise spending
Processing 52.9% Transport 11,334 Power 16,119 Oil 3,927 Industrial 2,280 Gas 26,570 Water 7,629 Chemical 6,864 Retail 2.9% Telecom 0.3% Commercial 14.9% Cultural 2.8% Education 4.0% Healthcare 4.0% Hospitality 4.5% Industrial 10.7% Marine 12.1%

Production 30.2%

Residential 33.5% Construction 47,690 Public 1.2% Mixed Use 9.2%

Storage 4.1% Transmission 12.7%

Source: Commercialbank Capital Research

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 17

The Exhibit 12 focuses on the expected spending over the next four years. The capital spending is expected to grow by about 48% between 2011 and 2014. The majority of the growth is expected in 2013 and 2014, when most of the projects are expected to kick start. Exhibit 12: Expected increase in capital spending
10.0

8.0

Capital spending is expected to increase by 48% between 2011 and 2014

6.0

4.0

2.0

0.0

2009 Power & Water

2010 Petrochemical

2011

2012 Oil & Gas Production

2013 Construction

2014 Infrastructure

Source: Commercialbank Capital Research

Exhibit 13: Qatars top 10 contractors 2011 Company JGC Corporation Saudi Binladin Consolidated Contractors Company Hyundai Heavy Industries China Harbour Engineering QDVC (Qatari Diar/Vinci Construction) Qcon Hyundai Engineering & Construction Qatar Building Company Al-Bader Construction & Steel Works Total
Source: MEED Projects

Awards (USD mn) 1,700 1,150 965 889 880 535 510 434 419 400 7,882

Origin Japan Saudi Arabia Athens Based South Korea China Local/France Local South Korea Local Local

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5. Transportation
The transportation sector has been at the forefront of public spending plans in the GCC region in general and Qatar in particular. In Qatar, the transportation sector is pacing development and expected growth in the country. In addition, the modernization of the transportation sector in Qatar is essential for successful hosting of the worlds biggest event. The government is signicantly focused on developing the countrys road network especially through main highways to ease trafc congestion. We believe that the improvement of the roads network will continue to be an ongoing investment for the government as the growth momentum continues in the region. Exhibit 14: Landmark projects in transportation sector Projects Qatar National Railway System New Doha International airport (NDIA) - (Phase I)
Source: MEED Projects

Cost (USD bn) 35.0

Client Qatar Railways Company (QRail) NDIA Steering Committee

Status Planned

11.1

Completion due in 2012

The total revised investment in the GCC transportation sector is USD 298 bn compared to an original budget of USD 281 bn. The total investment in rail projects is USD 95 bn in the region. The GCC countries are focusing on upgrading and developing rail networks within countries and also to connect the region. The GCC governments are also making signicant investments in upgrading their airports to meet the rising demand of both passengers as well as freight services. The total planned investment in airports is USD 41.4 bn in the GCC. During the past three years, Saudi Arabia has awarded about USD 28.3 bn worth of projects, UAE has awarded about USD 11 bn worth of projects and USD 6.1 bn in Qatar. Given the size of projects awarded or in the pipeline, many regional and international contractors are expanding operations in Qatar and Saudi Arabia. The regional contractors are mostly from Kuwait and the UAE as activity within their respective the respective countries have remained subdued. We believe that Qatar and Saudi Arabia will continue to remain the most dominant markets within the GCC region. Both the countries have announced signicant investment plans, especially in rail projects. The Qatari market looks more promising as the government is expected to accelerate the execution of planned projects to ensure timely completion as it prepares for the FIFA World Cup 2022. Exhibit 15: Value of projects announced in transportation sector (USD bn)
15.7 32.6 88.0 25.3 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

Exhibit 16: Value of projects awarded in transportation sector

10 9 8 9.1

10.1 9.1

USD bn

6 5 3 2 0 0.1 0.3 0.2 Bahrain Kuwait Oman 2009 4.1 4.1 2.5 1.0 1.3 1.8 0.5 Qatar 2010 Saudi Arabia 2011 UAE 1.8 4.4

54.8 81.6

3.7

3.8

2.1

Source: MEED Projects

Source: MEED Projects

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 19

5.1 Roads
The total planned or projects underway in the GCC countries are valued at about USD 128 bn. The UAE leads the market with USD 46 bn worth of projects planned or underway. Saudi Arabia is the second largest market with USD 38 bn worth of projects either planned or underway, while Qatar accounts for USD 18 bn worth of projects. Collectively, Kuwait, Oman and Bahrain have USD 27 bn worth of projects planned or underway. We believe that the execution of these projects will be important to reduce over congestion in the GCC. In the GCC, Qatar was the most active roads market in 2011. Ashghal awarded USD 2.3 bn worth of contracts during the year 2011. The biggest of these was the USD 1 bn construction package awarded to the joint venture of the Saudi Binladin Group and the local Qatari Diar for work on the Dukhan highway. The other big contract that was awarded related to the two road contracts in January, worth an estimated USD 0.52 bn, to a joint venture of Consolidated Contractors Company and the Teyseer Contracting Company for the 12th package of the Doha Expressway. The investment in Qatars roads sector is set to continue, with Ashghal planning to build 136 km of new roads by 2014, providing plenty of opportunities to local and international contractors and material suppliers. The major upgrades in roads infrastructure were undertaken even before the country won the bid to host the FIFA World Cup 2022. Strong economic growth in the past few years have led to a rapid increase in population, thus resulting in signicant congestion in the capital city of Qatar, Doha. The country has allocated USD 20 bn over the next ve years to upgrade its road network, of which USD 17.9 bn is planned or underway. Development of roads network is also essential for the overall infrastructure development of the country. The preparation for the World Cup 2022 will also speed up the process of the construction of roads to ensure decreases in trafc congestion, an increase in regional accessibility, and minimize the environmental impact of its transportation network. Exhibit 17: Planned/underway projects in roads (USD bn)
2.1 11.8 12.7 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

45.7

17.9

37.8

Source: MEED Projects

Exhibit 18: Roads project awarded in 2011 (USD mn) Projects Doha Dukhan Highway: Central Section Peripheral Roads to Barwa City Doha Expressway: Phase XII: F Ring Road Doha Dukhan: Al-Mail Roundabout to BaniHajer Roundabout Nakhilat Shipyard: Phase 4A Doha Expressway: Package 6 Doha Dukhan: Eastern Section
Source: MEED Projects

Contract Value 275.0 152.0 233.0 1,000.0 45.0 85.0 150.0

Completion Date Q1-14 Q2-13 Q1-14 Q4-14 Q3-12 Q4-13 Q4-14

EPC Contractors CCC and Teyseer Contracting Bin Omran CCC and Teyseer Contracting Qatari Diar and Binladin Group Eversendai Corp. Sinohydro Corporation Qatari Diar and Binladin Group

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Qatar is likely to witness the announcement of USD 7.8 bn worth of projects over the next two years. Qatar is expected to nish its planned roads network by the end of 2016, well ahead of the -World Cup 2022. According to our estimates, the total size of the road and bridges market in Qatar will be USD 26.5 bn at the end of 2020. We believe that new projects will be announced in line with the rising population as well as the trend to own cars in the region resulting in further upgrades in the countrys roads infrastructure. The governments USD 20 bn plan also includes investments in improving its sewage networks. USD 362 mn worth of projects has been awarded so far in 2011 for improving sewage networks around the city. The Doha North Sewerage Treatment and Associated Works project is a USD 2.2 bn four-part expansion. The improvement in sewerage networks at the Doha North Project is important as it is likely to witness increase in ows. Doha North will witness projects such as Lusail, the Pearl and Gharaffa, West Bay area, as well as alleviate some of the pressure placed on the existing Doha West Sewerage Treatment Works (STW). Three major road projects that which are underway further substantiate the ve-year plan to upgrade the road network of the country. The Doha Expressway, currently under construction is valued at USD 2 bn, the Dukhan Highway also under construction has been valued at USD 275 mn, and the largest proposed project, the Lusail Highway, which is currently being tendered, has been valued at a signicant USD 687 mn. Timeline: Road projects
Peripheral Roads to Barwa City Project Value: USD 152 mn Completion Date: Q2-13 Doha Expressway: Package 6 Project Value: USD 85 mn Completion Date: Q4-13 2012 Nakilat Shipyard: Phase 4A Project Value: USD 45 mn Completion Date: Q3-12 2013 2014 Doha Dukhan Highway: Central Section Project Value: USD 275 mn Completion Date: Q1-14 Doha Expressway: Phase XII: F Ring Road Project Value: USD 233 mn Completion Date: Q1-14
Doha Dukhan: Al-Mail to Bani Hajer Project Value: USD 1 bn Completion Date: Q4-14 Doha Dukhan: Eastern Section Project Value: USD 150 mn Completion Date: Q4-14

2015

2017

Ashghal has awarded USD 120 mn project to HBK Contracting. The project comprises of mechanical and electrical refurbishment work with related drainage works, civil and structural works at the existing pumping stations PS3/1, PS8/1, PS8/6, Series 8 Trunk Sewer, PS15, PS23, PS31 and PS44.

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The Public Works Authority (ASHGHAL): The leader in Roads and Sewage developments has undertaken QAR 100 bn worth infrastructure projects in ve years.
Proposed Road Network in Greater Doha
Expressways Artorial Roads

Roads The master plan programme called for a four phase programme to be implemented by Ashghal. This was to have included: Phase I (2008-11) Upgrading the Al-Rayyan road from the BaniHajar roundabout to Souq Waqif The F-ring arterial road The east-west corridor and New Doha International Airport road The F3 Salwa road freeway, stage I The F5 central freeway, stage I (Lusail expressway) The F1 freeway to Al-Shamal Phase II (2012-16) The F6 Doha Bay Freeway The F2 Khalifa Street/Majlis al-Tawoon The E8 Al-Khor expressway (Lusail North to Lusail South) The F21 Al-Waab freeway The Salwa road freeway, stage III The F5 central Freeway, stage III The Al-Saad arterial road The F61 Al-Wahda freeway The F2 Dukhan freeway (Al-Shamal road to orbital freeway) The F6 east-west corridor (from the Orbital freeway to New Doha port) The F4 Orbital freeway/E9 Lusail tangential The F5 Central freeway, stage II The E12 Western industrial expressway Phase III (2017-21) The E2 D-ring extension to New Doha International airport The A12 E-ring extension to the airport The E10 Al-Wukair expressway The E10Al-Waab expressway, stage II Phase IV (2021-26) Phase 4 consists of a pumping station for Treated Sewer Efuent (TSE3)

Source: Ashghal website

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5.2 Railways

The GCC region has a planned investment of USD 96 bn in the rail sector. The rail networks have garnered a signicant 32% share of the total transportation sector. Qatar is the largest market for the railways sector in the GCC, with a total investment of USD 35 bn. The total investment in the rail sector in Qatar accounted for 53% of the total planned investment in the transportation sector. Exhibit 19: Planned projects in railways
35 30 50% 25 20 15 10 5 0 7.9 12% 3.0 Bahrain Kuwait Oman Qatar 17.0 15.0 20% 18% 10% 0% Saudi Arabia UAE 18.0 35.0 64% 52% 70% 60% 50% 40% 30% 20%

Value of Projects

% of Transportation sector

Source: MEED

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 23

Exhibit 20: Ongoing or planned railway projects in GCC Expected Completion Date 2017 2015 2015 2015 2025 2020 2016 2014 2014

Projects GCC Railway Network Qatar National Railway System UAE National Railway Project Dubai Metro Bahrain Rail Masterplan Abu Dhabi Metro Kuwait City Rapid Transit Saudi Land Bridge Haramain High-Speed Railway

Value USD 30.0 bn USD 25.0 bn USD 10.9 bn USD 10.6 bn USD 7.9 bn USD 7.0 bn USD 7.0 bn USD 7.0 bn USD 7.0 bn

Coverage GCC nations North-South within Qatar Connects All Emirates in the UAE Dubai Bahrain Key Cities in Abu Dhabi Kuwait City From Jeddah to Riyadh in KSA From Mecca to Medina in KSA

Source: Frost and Sullivan, Commercialbank Capital Research

Qatar is the largest market for the railways sector in the GCC, with a planned investment of USD 25 bn. The objective of Qatars massive investment plan is to ensure that it can accommodate the movement of thousands of tourists during the tournament. The public transport, which is currently operated by Mowasalat in the form of taxis and buses, will not be adequate to host the FIFA World Cup 2022. In addition, increasing taxis and buses will put additional pressure on new roads and create congestion; therefore, a rail network within the country will be the most viable option for Qatar. Exhibit 21: Details of Qatar rail project Projects NDIA - Doha International Airport: Passenger Rail Station Box QRDC - Qatar Integrated Rail Project QRDC - Qatar Integrated Rail Project: Automated People Mover in West Bay QRDC - Qatar Integrated Rail Project: Doha Metro: Green and Yellow Line QRDC - Qatar Integrated Rail Project: Doha Metro: Lusail Light Rail Network QRDC - Qatar Integrated Rail Project: Doha Metro: Blue Line QRDC - Qatar Integrated Rail Project: Doha Metro: Red Line QDREIC - New Doha Airport to New Doha Port Railway
Source: MEED Projects

Award Date Value (USD mn) Q1 2010 120 Q2 2012 20,675 Q2 2012 2,200 Q2 2012 2,000 Q3 2012 1,158 Q2 2012 1,000 Q2 2012 1,000 Q4 2014 200

Recently, the organization that was responsible for developing the rail network has been restructured with the objective of expediting the process. A Railways Steering Committee has been established, Chaired by the Prime Minister; will be responsible for coordination of the entire project. QRail will now look after the rail network project, which was earlier been assigned to Qatar Railways Development Co (QRDC), a 51:49 joint venture between Qatari Diar and DB International (formed in 2009).QRail has started inviting expressions of interest from local and international companies to bid for design and construction contracts for the Doha Metro project. Recently, QRail has signed a USD 535.4 mn contract with Qatari Diar Vinci Construction (QDVC) for the new phase of works on the Lusail Light Rail Transit system. The contract covers civil engineering works in seven underground stations, the construction of a viaduct over the motorway between Doha and the northern part of the country and preliminary works on an LRT depot and maintenance workshop.

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Qatar plans to build a rail network, which is part of the countrys plan to spend USD 35 bn on rail infrastructure. Doha Metro, a 350 km rail network will have four lines, Red Coastal line, Golden Historic line, Green Education line and Blue City line. Red line: is the rst line to be developed and will operate from the NDIA to the West Bay area in central Doha. Gold line: will operate from east-west route linking NDIA and the airport city with the industrial areas in the west of Doha. Green line: will be from the industrial areas in the south through central Doha to Education City. Blue line: will follow the coast road, running from NDIA to West Bay and on to The Pearl and Lusail.

Qatar Integrated Rail Project Phase1 Underground: 28,952m Elevated: 56,170m At Grade: 44,327m Total length: 129,449m Phase2 Underground: 50,274m Elevated: 79,580m At Grade: 44,327m Total length: 212,181m Phase3 Underground: 60,211m Elevated: 108,225m At Grade: 44,327m Total length: 212,763m

Doha Metro map

Timeline: Railways
GCC Railway Network Project Value: USD 30 bn Completion Date: 2017 Civil works award due for West Bay by September 2012 2011 Consultants prequalify for metro. PMC bids invited for West Bay people-mover PMC bids invited for Lusail LRT Aecom-Parsons wins PMC for Lusail LRT Civil works tender due for West Bay. Construction due to start on Red Coast PMC award due for West Bay 2013 2016 Testing and commissioning of freight railway to start by 2016 Testing and commissioning of Red Coast Line to start 2017 2026 Entire rail programme will be completed

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 25

5.3 New Doha International Airport


The aviation sector in the GCC has undergone a major transformation during the past decade. Passenger trafc in the GCC has grown at a CAGR of around 10% between 2002 and 2010, signicantly higher compared to global trafc. According to the International Air Transport Association (IATA), the Middle East is one of the fastest growing markets in the world with expected annual growth of about around 9% till 2014. A recent Boeing forecast indicates that it expects orders of 2,520 planes from the Middle East carriers by 2030.The total value of projects planned or underway in the GCC is USD 42 bn. In the GCC, Qatar has an aggressive aviation sector expansion plan to emerge as an aviation hub in the region. The country is also gearing itself to maintain pace with a steady increase in passenger trafc to and to trafc to-and-from Doha. In addition, Qatar Airways rising eet size has also been leading to an increase in transit passengers, putting additional pressure on airport authorities. Qatars current airport is facing increasing congestion and will be replaced by a new airport with signicantly larger cargo and passenger facilities, thereby making it an important transportation hub for the people and materials. Exhibit 22: Projects awarded (USD bn)
4.9 8.2 2.7 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

7.1

11.2 7.3

Source: MEED Projects

The government plans to invest USD 11.1 bn for NDIA which includes two runways and a 140,000 sqm airport terminal. Currently, the airport is handling 14.9 mn passengers a year. At the completion of rst phase in March 2012, the airport will be able to handle 24 mn passengers and 750,000 tons of cargo a year. On completion of the second phase in 2015, the capacity will double to 50 mn passengers per year. The NDIA is also developing its air cargo terminal with an initial handling capacity of 1.4 mn on completion of the rst phase. This gure is expected to grow to 2 mn tonnes (mt) at the end of second phase, making it one of the largest cargo terminals in the world. In line with these developments, Qatar Airways is also planning to develop its air cargo business. Exhibit 23: Airport contracts awarded (2004 2010) Projects NDIA Infrastructure Packages NDIA Passenger Terminal Complex NDIA Aireld Paving, Tunnel and Detention Ponds Works NDIA Concourse C NDIA Aircraft Maintenance Hangar NDIA Reclamation and Dredging Total
Source: MEED Projects

Value (USD mn) 3,550 1,000 932 778 670 425 7,355

Project status Execution Execution Execution Execution Execution Execution

Award date 2007 2007 2005 2009 2006 2005

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New Doha International Airport

The government of Qatar began upgrading the NDIA even before winning bid to host the FIFA World Cup 2022 following increase in the number of tourists thanks to initiatives undertaken by the tourism authority of Qatar. Qatar is preparing for the upcoming expected rise in demand as Qatar Airways further enhances its eet size to move up the international ranking. This will help the airline post an increase in its current ying destinations, making Qatar a hub for major connections across the globe. Timeline: Airport projects
2012 New Doha International Airport (Phase I) Total Project Value: USD 11.1 bn Completion Date: 2012 Passenger Capacity: 24 mn Cargo Capacity: 750,000 tn 2014 2015 New Doha International Airport (Phase II) Total Project Value: USD 11.1 bn Completion Date: 2015 Passenger Capacity: 50 mn Cargo Capacity: 2 mn tn 2016 2018

Qatar Airways Qatar Airways is a group of companies with diverse interests from core passenger and cargo transportation and airport to alcohol distribution, sports and hospitality. The group comprises Qatar Airlines, Qatar Duty Free, Qatar Airways Cargo, the Qatar Distribution Company (the only licensed retail distributor of alcohol in Qatar) and Doha International Airport. Since the re-launch of Qatar Airways in 1997, the company has been growing at 30% per year. During this period, the eet size has increased from four aircrafts to 97 aircrafts in 2011. This gure is expected to reach 110 by the end of 2013. The company has entered into a multi-billion dollar deal with Airbus to supply 80 aircrafts. Qatar Airways is among the best and the fastest growing airlines in the region winning the award for the Best Airline in the Middle East and Africa at the 2011 Business Traveler Asia Pacic Awards for the second year in a row. In December 2011, the CEO of Qatar Airways was unanimously nominated to serve on the board of governors of the International Air Transport Association, which represents over 90 % of the worlds air transport. This further substantiates Qatar Airways image in the industry and its commitment to being one of the best airlines in the region. The company is rapidly expanding its destinations, as well as ight frequency. In 2011, it has expanded and/or started new ights to various destinations. The company is expected to add 20 new destinations by the end of 2013.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 27

In March 2011, Qatar Airways announced a strategic partnership with Qatar Telecom (Qtel) for the migration of its primary IT infrastructure to the Qtel data centre. In September 2011, the company bought a 35% stake at the Luxembourgbased cargo carrier Cargolux, which is in line with its objective to develop its air freight business. Qatar Space City is a plan of the Government of Qatar to establish a USD 3.3 bn Space City in the Al-Khor area, covering an area of 40,000 sqm. The project will include establishment of a university in cooperation with the US National Aeronautics and Space Administration (NASA), along with a science museum and other tourist attractions. The planned project is expected to be implemented in several phases under the supervision of an ofcial body that would be appointed with the General Authority of Civil Aviation. The concept of the space city project is based on the American Space Museum.

5.4 New Doha Port


The GCC ports sector is mostly dominated by the oil and gas sector, as most of the production is exported to the emerging markets. However, this is set to change in the coming years as the region continues to make signicant investments to diversify its economic base. The new proposed port in Qatar is likely to transform the country into the new trading hub of the region, which is in line with the country Vision 2030. The country can aspire for such goals as it has the required funding thanks to rising hydrocarbon prices in recent years, which has resulted in accumulated surpluses. The main objective of the new port is to replace the existing port, which is struggling to keep up with growing demand owing to the limited land at its disposal. Currently, the country has three main ports: Port of Doha (Qatars main commercial seaport), Port of Ras Laffan (the worlds largest LNG exporting facility), and Port of Mesaieed (Qatars main oil export terminal and the main point of entry for aggregates and other building materials). In order to meet the heightened trafc of goods and supplies generated by the countrys economic boom and rising population, the Government of Qatar plans to expand and develop its port infrastructure. Qatars ports are dominated by LNG exports. However, this phenomenon is likely to change over the next few years as the country makes signicant investments to diversify its economy away from the hydrocarbon sector. The current planned investments in the sea port sector are aimed at addressing the additional capacity of LNG, while the future expansion plans aim to address the expected rise in demand from the massive development program undertaken by the government. Exhibit 24: Planned projects in sea ports ($ bn)
0.8 2.7 2.8 15.4 2.1 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

8.6

Source: MEED Projects

28 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

An artist impression of the USD 5.5 bn deepwater seaport near Qatars industrial city of Mesaieed

Exhibit 25: Port capacity Port Name New Doha Port Port of Ras Laffan Port of Mesaieed
Source: Commercialbank Capital Research, Note: *Cubic meter

Capacity 6 mn teu 6.3 mn m3* 2 mn teu

Year of Completion 2016 NA 2014

In April 2010, Qatar received bids from about nine consortiums for the major contract of the New Doha Port. In March 2011, the steering committee signed its rst contract with the China Harbor Engineering Company (CHEC) for of QAR 3.2 bn, in a four-and-half year deal. The second contract has received bids, and is likely to be awarded soon. We believe that Qatar will have to expedite its process of bidding and awarding and thereafter execution in order to keep pace with its regional peers. Timeline: Port projects
New Doha Port (Phase II) Total Project Value: USD 7 bn Start Date: 2020 Capacity: NA 2016 New Doha Port (Phase I) Total Project Value: USD 7 bn Completion Date: 2016 Capacity: 6 mn TEU (20-foot equivalent units) 2020 2025 2030 New Doha Port (Phase III) Total Project Value: USD 7 bn Start Date: 2030 Capacity: NA

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 29

6. Iconic Projects
6.1 The Pearl-Qatar
The Pearl-Qatar is a Riviera style manmade island developed in an exclusive environment in Doha. It is one of the largest real estate developments in the GCC, covering 400 hectares (4 mn sqm) of reclaimed land. It is also Qatars rst international luxury residential development that offers international investors freehold title ownership. It is located 20 km from Dohas international airport and 350 meters offshore from Dohas prestigious West Bay District. The rst investors took up residency in 2009, and the entire project is expected to be completed by 2013. The Pearl will house about 40,000 residents and includes luxury apartments, high rise towers, town homes, penthouses and Mediterranean villas, an international yachting hub with three marinas and 700 boats, three 5-star hotels, 2 mn sqf of international retail, restaurants and entertainment hubs, as well as a family destination with schools and community facilities.

The Pearl, Qatar

United Development Company (UDC) is the project developer overseeing the projects entire infrastructure and construction of municipal buildings. Dar Al-Handasah (Shair and Partners) is a project manager.

The idea behind Pearl Qatar is to attract as many people as possible from Qatar and the region, as well as from other parts of the world. It will have high-end shops and ne-dining restaurants from countries such as Spain, Italy and the United States. The Pearl-Qatar, with it 40 km of reclaimed coastline and 20 km of pristine beaches, is among the main tourist attractions of Qatar. There are three retail areas which have their own themes. One of them is the Porto Arabia covering 200,000 sqm, and consists of 385 retail shops, including fashion, jewellery and ne dining. The Medina Centrale, with an area of 600,000 sqm, is set to provide cinemas and supermarkets among others, while the Qanat Quartier will be the cultural destination with its impressive design, allowing people to enjoy parks and art galleries. Nikki Beach Resort & Spa is a Miami-based resort chain set to open in July 2012. It will be a boutique beachfront resort with 47 luxury villas and spa suites located at Porto Arabia. It is designed by the award winning Singapore based ECO ID Architects with interior design by Gatserelia Design.

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6.2 Msheireb
Msheireb is an iconic project aimed at displaying innovative development and rediscovering local heritage and culture. The project is divided into six main character zones namely Diwan Quarter, Heritage Quarter, Retail Quarter, Kahraba Quarter (residence and mix use), Nakheel Quarter (HQ gateway). The project will house 226 buildings to provide homes to 27,637 residents. It will have parks and open spaces spread over approximately 122,217 sqm. The project will have three types of hotels namely Lifestyle hotel, Luxury hotel and Business hotel and a theatre auditorium with a 500 to 700 seating capacity. One of other distinctive features of the project is that it is expected to have underground metro stations to provide links to other parts of country. The project will be completed in ve phases with the rst phase due for completion by 2012. The rst phase will consist of a multi-use Cultural Forum, central luxury hotel and serviced apartments, ofces, a shopping street, townhouses, a primary school and a mosque. Phase 2, 3 and 4 will consist of retail malls, hotels, ofce apartments and shops.

Msheireb

Exhibit 26: Details of Msheireb development Projects Msheireb Properties - Mandarin Oriental Hotel Msheireb Development: Infrastructure Works: Phase I Msheireb: District Cooling Plants Msheireb: Phase 1a Msheireb: Phase 1b Msheireb: Phase 2, 3 and 4
Source: MEED

Budget Value (USD mn) 80 142 50 428 500 4,072

Project Status EPC Bid Execution Execution Execution Execution Design

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6.3 Lusail City


Lusail City is a modern yet traditional and environmentally friendly city. The estimated cost of the development is USD 33 bn, which will be executed in phases over the next 10 years. Lusail City will be located on the east coast of Qatar, approximately 15 km north of the city center of Doha. Lusail City will have residential, commercial and two marinas. It will also have a full array of community needs such as schools, mosque, medical facilities, sports, entertainment, cultural facilities and shopping centers. The city will have 25,000 residential units which will accommodate approximately 200,000 residents. An estimated 170,000 are anticipated to work at the different districts and expected to attract further 80,000 visitors to the city.

Lusail City

Freehold ownership of Lusail City properties is available to all Qatari and GCC nationals, while foreigners can acquire property on a 99-year lease basis. The infrastructure of Lusail city is divided into two phase which was further subdivided into construction zones, known as construction package (CP). There are 16 major CP which are under different stages of development. The entire infrastructure at this stage is planned to be completed by the end of 2013. Similarly, the entire Lusail City will be connected to an extensive natural gas pipeline network. Exhibit 27: Lusail City construction projects Projects Transport Al-Khor Highway Lusail Expressway Phase one Lusail Expressway Phase two Lusail light-railway transit (LRT) Lusail LRT rolling stock contract Real Estate Al-Sidra Golf Residential Development Lusail mixed-used development Lusail Entertainment City Sports Lusail Iconic Stadium
Source: MEED Projects

Total value NA USD 350 mn USD 350 mn USD 1.8 bn USD 1.8 bn USD 3.5 bn USD 800 mn USD 1.5 bn USD 662 mn

Status Design EPC bid Design PMC awarded EPC bid Design On Hold On hold Design

Client Public Works Authority (Ashghal) Ashghal Ashghal Qatar Railways Development Company (QRDC) QRDC Arcapita, Barwa Real Estate Company Diyar al-Kuwait Real Estate Company ADIH, Majid al-Futtaim Group Qatar Olympic Committee

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Seef Lusail

6.4 Seef Lusail


Seef Lusail, a project under development by Seef Lusail Real Estate Development Company SEEF, has appointed DP Architects as master planners for the project. The developer, SEEF, is a joint venture between Masraf Al Rayan and Qatari Diar that will take on the full development of Seef Lusail. Issa Mohammed Al Kaladari, CEO of Lusail City was appointed as Chairman of SEEF. Khalid Ahmad Fakhroo, Executive Director of Engineering and Real Estate at Masraf Al Rayan, has been appointed as the CEO of SEEF. Seef Lusail is a 600,000 sqm multi-use development located at the waterfront of Lusail, a distinctive 21st century iconic city which celebrates the special cultural and geographical heritage of Qatar and the Gulf Region DP Architects is a leading architectural practice in Asia with over 1200 staff and 12 ofces worldwide. It has been operating in the Gulf region since 2005 and their key projects in the region include The Dubai Mall, the Address at Dubai Marina, Doha Festival City, Dilmunia Health City in Bahrain and The Eighth Gate in Damascus. The rm was founded with a deep concern for the built environment and the need to create architecture of excellence that enriches the human experience and spirit. Seef Lusail will feature an interactive 2.3 km waterfront promenade that will include multiple world class attractions that will cater to various age groups and families. The developer, SEEF conducted a number of studies on waterfront destinations worldwide in an effort to create an innovative design with a strong emphasis on creating themes throughout Seef Lusail that reect and compliment Qatars traditions and values. Seef Lusail will further add to Qatars appeal as an international destination that rivals major global destinations. The design will take into consideration the climate in Qatar, in order to have a lively and active waterfront all year long. The hotels in Seef Lusail will cater to the family, business and luxury leisure segments. One of the hotels will be a fully integrated resort and spa providing guests with a unique leisure experience. Discussions and negotiations are underway with global hotels brands that will bring new concepts and ideas to Qatar.

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7. Retail & Leisure


The GCC retail sector has undergone a paradigm shift over the past decade on the back of a robust macroeconomic environment. The region has emerged as one of the most attractive destinations for retailers across the globe. Changing consumer behavior and lifestyle, increasing inuence of western culture, rising disposable income have led to phenomenal growth in the retail sector. As a result, the retail sector in the GCC is contributing to the overall growth in the non-hydrocarbon sector. Shopping malls and organized retail stores have gained prominence in the region as they are regarded as one stop entertainment shop for residents and tourists alike. Therefore, the total projects planned or underway for shopping malls in the region is USD 11.1 bn. We believe that Qatar has the potential to attract a bigger share as it prepares for the World Cup 2022 and the government thrust towards becoming a touristic hub in the region. Exhibit 28: Gross leasable area (GLA) in 2010 (sqm 000s)
639 571 Bahrain Kuwait Oman Qatar Saudi Arabia UAE 311

4,234

4,045

521

Source: Alpen Capital

Doha Festival City

The emergence of trade, restaurants and hotels sector as the fourth largest contributor to GDP in 2010 reects the strong and growing performance of Qatars retail industry in recent years. The contribution to GDP has increased from 4.4% in 2006 to reach 5.5% in 2010. The retail sector growth in Qatar has mirrored the economic growth in the country. Qatars rapid economic growth has led to one of the highest GDP per capita in the world. Qatars retail sector has evolved over the past few years on the back of rapid growth in population. The sector has benetted from the rising purchasing power of its residents in recent years. This has led to a shift from unorganized to organized shopping, resulting in shopping malls and complexes. Shopping malls have become an important part of everyday life as they constitute a good source of entertainment for both residents and tourists in the country.

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Exhibit 29: Retail future supply 2012 2015 Project Gulf Mall Ezdan Mall Doha Festival City Northgate Mall Mirqab Mall Marina Mall Barwa Commercial Avenue Mall Barwa Al Doha
Source: DTZ Research and MEED Projects

GLA (sqm) Completion Date Project Value 80,000 2012 USD 100 mn 40,000 2012 USD 50 mn 240,000 2014 USD 1.65 bn 100,000 2013 USD 327 mn 36,000 2013 USD 200 mn 60,000 56,600 55,000 2015 2012 2015 USD 275 mn USD 1,100 mn USD 824 mn

Developer Business Trading Company Ezdan Real Estate Company Bawabat al-Shamal Real Estate Equinox H.E. Sheikh Hamad Bin Jassim Al Jaboor Al Thani Qatar Foundation Barwa Real Estate Company Barwa Al Doha (Developer)

Although, shopping malls and commercial centers have entered the market during the past couple of years, the retail space remained scarce in the country. This has resulted in speculative demand, which has prompted sub-letting at enormously high prices. The prices of sub-letting can vary between QAR 100 to QAR 150 per sqm depending on the location. Surprisingly this phenomenon has become highly common in Doha. Qatars total retail stock was about 630,000 sqm (GLA) at the end of 2010, an increase of around 30% compared to 2009. Based on planned developments, Qatar will add 626,000 sqm (GLA) of new organized retail space by the end of 2012, thus doubling the existing retail capacity. The completion of 433,847 sqm (GLA) of Doha Festival City complex, which is being developed by Al Futtaim will be completed by 2014. The Barwa Commercial Avenue is under construction, which will yield 1 mn sqm of built up area. The rst phase of the project will yield around 0.5 mn sqm of GLA. The rst phase is about 60% complete and the rest is to be completed by the end of 2012. Both these projects will more than double Qatars current GLA upon completion. The total planned and projects underway in shopping mall are USD 3.1 bn. There are around 10 new malls being planned in Qatar. The total number of projects awarded during the year 2011 is USD 523 mn. Around USD 2 bn worth of projects is to be awarded in the year 2012 and 2013.

7.1 Doha Festival City (DFC)


DFC will be the largest mall in Qatar with a mixed use of shopping, entertainment and leisure. The project is owned and developed by Bawabat Al Shamal Real Estate Company (BASREC). BASREC shareholders include Al-Futtaim Real Estate Services, Qatar Islamic Bank (QIB) and private Qatari companies. DFC will be built on a 433,847 sqm plot with a GLA of around 260,000 sqm, which is located around 15 km north of downtown Doha on Al Shamal Road. DFC will consist of mall and entertainment complex, hospitality and ofces and automotive showrooms. The retail section will have four distinct interior zones, namely Water Concourse, Garden Promenade, Rainforest Boardwalk and Fashion Galleria. DFC will be the home to IKEA, Toys R Us, Marks & Spencer and Inter-sport. The rst phase of the project, which will include the retail section, is likely to be completed by the fourth quarter of 2012. The remaining sections of the DFC are expected to be completed by the end of fourth quarter of 2014.

7.2 Lagoona Mall


Lagoona Mall is a 127,000 sqm two level lifestyle shopping centre with 53,000 sqm of retail shopping, built at an estimated cost of QAR 1.4 bn. Lagoona is developed by Dar Investment & Development and is leased and managed by Darwish Holding for an initial period of 30 years. The main contractor was Al Seal Contracting & Trading Co and Hill International (project Management) MZ & Partners (Design and Supervision) are the consultant. One of Lagoonas unique features is a 20,000 sqm European piazza, featuring 5,000 sqm of ne dining which will be home to 20 restaurants with outdoor patios. The shopping center comprises 170 retail stores. Similarly, it also provides parking for over 2,000 vehicles. The mall is the home to luxurious multi brand store, Fifty One East. The store covers an area of 13,000 sqm which is the biggest in the Middle East region.

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7.3 Katara
Katara is the Cultural Village of Qatar, where cutting edge activities of all elds show the cultural diversity of the world in one single traditionally Qatari place. It is the largest and the most multidimensional cultural project of Qatar. It covers an area of 1 mn sqm and is located between Dohas West Bay and the pearl. The approximate cost of the project is USD 82 mn. Katara hosts international, regional and local festivals, workshops, performances and exhibitions at its prestigious venues such as theatres, libraries, art galleries, museums, an opera house, and a multi-purpose halland Roman-style amphi theatre which is the largest in the Middle East. It also has traditional cafes/restaurants, marinas, handicrafts souq, mosques and playing eld for children. Katara has held various performances since its opening in October 2010 which includes Qatar Philharmonic Orchestra, Doha Tribeca Film Festival, Photography Exhibitions (i.e. Our Time, Doharama) and Cultural Performance during AFC Asian Cup Jan 2011.

KATARA - Cultural Village

7.4 Cinemas
Recently, Q media announced a deal to acquire 60% stake in Qatar Cinema and Film Distribution Company for nearly QAR 2 bn. Q media and Qatar Cinema and Film Distribution Company plans to invest more than QAR 1 bn in the next three years to open more than 50 state-of-the-art multiplex facilities. Exhibit 30: Cinema screens in the region
17 Abu Dhabi Dubai Kuwait Qatar

38

13

14

Source: Various

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In the GCC, Qatar has the maximum number of cinemas. The total number of cinemas in Qatar stood at 38 compared to around 30 in Dubai and Abu Dhabi. Aspire Zone Foundation (AZF) opened the rst women cinema in Qatar capital, Doha. All the lms for this cinema are provided by Qatar Cinema and Film Distribution Company. Qatar has also launched Doha Film Institute (DFI) to build a strong lm industry in Qatar along with strong links to the international lm community. World Cinema Foundation has signed a three-year cultural partnership with DFI to restore and preserve international lms of cultural signicance. Doha has hosted international lm festivals - Tribeca Film Festival Doha and Al Jazeera Documentary Film Festival in the past. Qatar is moving in the right direction to become the main attraction and hosting big events in the coming years. We remain optimistic on the prospects of the entertainment and believe that it will gradually emerge as one of the top entertainment hubs in the GCC. Timeline: Retail projects
Northgate Mall Project Value: USD 327 mn Completion Date: 2013 GLA: 100,000 sqm Lagoona Mall Project Value: USD 348 mn Completion Date: 2011 GLA: 127,000 sqm 2011 2012 Gulf Mall Project Value: USD 100 mn Completion Date: 2012 GLA: 80,000 sqm Ezdan Mall Project Value: USD 50 mn Completion Date: 2012 GLA: 40,000 sqm Barwa Commercial Avenue Mall Project Value: USD 1,100 mn Completion Date: Q2-12 NLA: 56,600 sqm Mirqab Mall Project Value: USD 200 mn Completion Date: 2013 GLA: 36,000 sqm 2013 2014 Marina Mall Project Value: USD 275 mn Completion Date: 2014 GLA: 57,605 sqm Barwa Al Doha Mall Project Value: USD 824 mn Completion Date: 2014 GLA: 271,000 sqm Doha Festival City Project Value: USD 1.7 bn Completion Date: Q4-14 GLA: 260,000 sqm 2015

7.5 Hotels & Tourism


Qatar Tourism Authority (QTA) plays an important role in promoting Qatar as an evolving tourist destination. The company organizes and supervises the development of the tourism industry in Qatar. According to the World Travel and Tourism Council (WTTC), Qatar has one of the fastest growing tourism sectors in the world. The contribution of the travel and tourism sector to GDP is expected to rise 6.4% per annum by 2021 from QAR 3.8 bn or 0.7% of total GDP in 2011. These assumptions are on the back of signicant planned investments in the sector and in line with the governments thrust to become a major tourist destination. QTA has done a commendable job in organizing and participating in conferences and exhibitions over the years, which has transformed Qatar into a business destination within the region. The increase in the number of business travelers due to the conferences and exhibitions is improving the hotel occupancy rates in Qatar. In terms of revenues, 4 star hotel revenues increased to QAR 182.4 mn in the third quarter of 2011 to QAR 101.9 mn during the same period of previous year. In terms of 5 star hotels, the revenue increased to QAR 385.6 mn in the third quarter of 2011 compared to QAR 304.6 mn of the previous year.

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St. Regis Hotels & Resorts is making a landmark entry into the Middle East with The St. Regis Doha. The hotel is part of Al Gassar Resort and is expected to open on 28 February 2012. The hotel is strategically located near the Katara Cultural Village and Doha Exhibition Centre. It will comprise of 336 guest rooms and suites, a cornucopia of signature restaurants, a world-class Remede Spa, and a 1,850 sqm Grand Ballroom with a capacity of accommodating 1,200 guests. According to the latest gures from QTA, the tourism sector in Qatar is witnessing a steady growth. The report indicated that the occupancy rates have increased by around 4% in the third quarter compared to the same period of the previous year.

St. Regis Hotel, Doha

The revenues from 4 and 5 star hotels witnessed an increase during the period, indicating strong domestic and regional interest in the sector. This increase was due to the 24% increase in visitors from the GCC region, especially Saudi Arabia as it accounts for around 60% of the total tourist within the region. According to hotelier Middle East, Qatar has 17 ve star and 13 four-star hotels at the end of January 2011. In total, Qatar had around 66 hotels. According to QTA, the total number of hotels is expected to reach 240 by end of 2022. This is a substantial increase in the number of hotels in the next ten years. According to QTA, about 90% of future supply will provide four and ve star accommodation. The total planned and underway projects are USD 2.4 bn. As of now, USD 1.6 bn worth of projects has been awarded. Currently, there are 10,000 hotel rooms and additional 5,500 will be come on stream by the end of this year. By the end of 2013, the total hotel rooms will reach 30,000. Around 5,000 new rooms will come on stream each year through 2022. Exhibit 31: Qatar growth in hotels (forecast till 2022)
250 240

200 No. of Hotels

150

100 51 58 66

50 0

2008

2009

2010

2022F

Source: Zawya

Qatar Museums Authority (QMA) has awarded a contract worth USD 434 mn to a South Korean construction rm Hyundai Engineering & Construction to build the National Museum of Qatar designed by the French architect Jean Nouvel over an area of 46,000 sqm in Doha. The construction of the museum is expected to be completed by 2014. Qatars

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National Museum will be an add-on to the Museum of Islamic Art in Doha designed by IM Pei, which opened in December 2008, as well as the Arab Museum of Modern Art in Doha, which opened last December.

New National Museum of Qatar

The QMA has also announced to open a Museum of Islamic Art (MIA) park built upon an area of around 280,000 sqm with no entrance fees for visitors. The park is designed by Pei Partnership Architects of New York. In addition, they will also provide various facilities like music evenings, paddle boats, lm screenings, sports events and art workshops. The plans for building a new Museum of Photography designed by Santiago Calatrava are in progress. Timeline: Hospitality projects
2011 2012 New Doha Hilton Hotel Project Value: USD 60 mn Completion Date: Q1-12 Capacity: 320 rooms Crowne Plaza Doha: The Business Park Project Value: USD 165 mn Completion Date: Q1-12 Capacity: 265 rooms St. Regis Hotel and Residential Tower Project Value: USD 415 mn Completion Date: Q1-12 Capacity: 320 rooms Doha Regent Hotel Project Value: USD 100 mn Completion Date: Q3-12 2013 2014 Qatar National Museum Project Value: USD 434 mn Completion Date: Q2-14 Capacity: 220 seats Mandarin Oriental Hotel Project Value: USD 80 mn Completion Date: Q1-14 Capacity: 160 rooms Planet Hollywood Hotel Entertainment City Project Value: USD 0.1 bn Completion Date: Q4-14 Capacity: 300 rooms Four Seasons Hotels and Resorts Project Value: USD 150 mn Completion Date: Q2-14 Capacity: 350 rooms 2015

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8. Social Infrastructure
Social infrastructure development becomes important in the midst of economic development. In addition, it is important in attracting expatriates to work and live in Qatar. These are indirect ways of creating demand, which will support the countrys National Vision 2030 of reaching their target population by the end of 2030. Investments in social infrastructure such as hospitals and education is on the rise as providing adequate education for the growing young population is the backbone of economic diversication. Both the healthcare and education is part of the governments human development programme.

8.1 Education

Education City

The education sector has undergone major transformation over the past two decades. The country has made major investments in improving the quality of its education system. Qatar leads the GCC in terms of education reforms as it ranks among the top ve nations globally in terms of quality of primary education. The government established the regulatory body, Supreme Education Council (SEC). The SEC comprises of three institutes, namely Education Institute to develop curriculum and professional training for teachers and staff, Evaluation Institute to assess and monitor the performance of schools and the Higher Education Institute to help outstanding students. According to a recent study by Qatars permanent Population Committee, the number of students is rising by around 4.5% annually. The strong growth in student enrolment has led to reform of Qatars primary and secondary schools. Currently, there are 165 independent schools serving around 80,000 students under the new system provided by the SEC. We believe that there are opportunities for the primary and secondary schools due to the rising demand, however, the main challenge would be the exorbitant prices of land. This would be lead to higher pricing structure for new schools, which may be unfavorable when compared to the existing schools.

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Exhibit 32: Universities in Qatar University / College Qatar University Virginia Commonwealth University Northwestern University Weill Cornell Medical College Georgetown University Texas A&M University Carnegie Mellon University HEC Paris University College London Stenden University University of Calgary College of the North Atlantic
Source: Commercialbank Capital Research

Country of Origin Qatar USA USA USA USA USA USA Europe Europe Netherlands Canada Canada

One of the most signicant changes in the education sector was the establishment of Education City by the Qatar Foundation. Due to the modernization and its world class facilities, it has attracted both universities and students from around the region. Six American universities have opened branches in the Education City. Apart from these international universities, Qatar University continues to remain the main attraction for local students. The university also underwent series of reform between 2003 and 2007. The university offers 60 degrees from seven different colleges. In addition, the main driver for Qatari people to enroll in the public university is to secure high paying public sector jobs. Hamad bin Khalifa University is an initiative of Qatar Foundation for Education, Science and Community Development (QF) in honor of His Highness the Emir, HH Sheikh Hamad Bin Khalifa Al-Thani. This new multi-disciplinary university will combine the learning, teaching and research being carried out at the branch campuses of the universities and other academic centers at the Education City. The total projects planned or underway in Qatar is USD 6.6 bn. Total projects awarded during the year 2011 reached USD 1.2 bn, while it is expected that USD 620 mn worth of projects will be awarded during the fourth quarter of 2011. We believe that the total investment is likely to surpass the USD 6 bn as the development in Qatar will induce more primary and secondary schools and western universities to meet the rising demand in Qatar. Going forward, the government will continue its investment program to further improve its education system, which is important for the overall development of the country. The government intends to bring in modern educational curriculum, which will benet the development of local population. This is in line with the governments Vision 2030.

8.2 Healthcare
The government thrust on improving its healthcare system, makes in one of the largest spenders on healthcare in the GCC region. The rapid increase in population during the past ve years has resulted in serious shortages for healthcare system in Qatar. Qatar has a total of 9 hospitals and 22 primary healthcare centers. On an average, the government allocated around 10% of the total annual budget toward healthcare and related activities. In the countrys 2011/12 budget, the government has allocated QAR 8.8 bn (USD 2.4 bn) to the healthcare sector, which is around QAR 300 mn higher compared to the previous year. One of the key elements of human development of Qatar National Vision 2030 is health of the population. Qatar has introduced its National Health Strategy (NHS) 2011-16, in order to align with the Qatars National Vision 2030 and its ambition of becoming a regional centre for medical research. The strategy has 35 projects in plan over the next six years which will improve the overall healthcare services and fulll the needs of world class healthcare system.

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Timeline: Healthcare projects


Sidra Medical City (Phase I) Project Value: USD 7.9 bn Completion Date: Q4-12 Capacity: 380 Beds 2011 Al Wakrah Hospital Project Value: USD 0.5 bn Completion Date: Q1-11 Capacity: 280 beds 2012 2013 Hamad Medical City Project Value: USD 1.1 bn Completion Date: Q2-13 Capacity: 1,340 Beds 2014 2015

Qatar spends around USD 137 mn per annum to send patients outside the country for treatment as it lacks quality healthcare. In order to address this issue, the government is planning to spend USD 8 bn on hospital construction projects by the end of 2016. The countrys public works ministry has approved plans to build eight new hospitals by 2016. The new hospitals will add 5,000 beds to the current capacity. One of the main challenges is attracting skilled professionals to achieve quality healthcare system in the country. The government has taken several initiatives to improve the quality and services of the healthcare system in Qatar. The government has formed partnerships with various foreign universities, institutions and colleges like University of Calagry Qatar and the Weill Cornell Medical College. The institutions have their campus in Qatar providing healthcare/ medical education and nursing training programmes. One of the most ambitious projects in the healthcare sector is the USD 2.5 bn Sidra Medical and Research Centre, USD 1.5 bn Hamad Medical City, and USD 500 mn Al Wakhra Hospital. Sidra Village: Mazaya Qatar Real Estate Development Company has awarded a $130m contract to Chinas Sinohydro to deliver the Sidra Village project in 20 months. Sidra Village comprises 1,165 residential units, including 658 onebedroom and 507 two-bedroom apartments. Sidra Medical and Research Centre is one of several initiatives taken by HH Sheikha Mozah bint Nasser AlMissned. The aim is to become the leading centre for the development of medical science in the Middle East. The three essential missions behind the initiative are patient care, medical education and biomedical research. Sidra Medical and Research Center will be located in Education City. It is owned and funded via a USD 7.9 bn endowment from Qatar Foundation. Sidra Medical and Research Centre will provide employment to around 5,000 people including doctors, nurses, technical staff, biomedical researchers, administrators and support staff. The centre will also have parking facility for approximately 2,000 vehicles and a residence for 350 nurses.

New Sidra Medical and Research Centre

The medical center will work closely with Weill Cornell Medical College in Qatar and Hamad Medical Corporation in regard to all three missions, raising the standard of health care throughout the country and providing valuable opportunities for training the medical students and clinician. It will also include research in the eld of pregnancy health, infertility, genetic abnormalities, the health needs of children, and diseases specic to women. It will be the rst hospital in Qatar to have a fully integrated clinical information system as well as the rst academic medical center in the region based on the North American model.

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Total building area (sqf): Approx. 2,520,000 (hospital and clinic); Approx. 3,600,000 (including structured parking). Phase I consists of 380 beds, not including labor and delivery rooms, and 53 high-risk/ICU obstetric beds. Phase II is planned to expand hospital capacity to approximately 550 beds and double the sizes of the Outpatient Clinic and research facilities. Qatar Foundations Capital Projects Department is overseeing all elements of the design and construction of Sidra Medical and Research Center. Led by Engineer Saad Al Muhanadi, QF Vice President for Capital Projects, a world class team has been assembled that includes the following entities: Qatar Petroleum serves as the Client Representative on behalf of Qatar Foundation. KEO International is the Program /Construction Manager, serving as the link between Qatar Foundation, Qatar Petroleum, the Executive Architect, and all other parties. Pelli Clarke Pelli, a US architectural rm, is the Design Architect and creator of the actual design of Sidra. Kurt Salmon Associates is conducting the medical planning and space programming. A $ 2.3 billion construction contract has been awarded to an international consortium including OHL and Contrack.

Legend
1 2 3 4 5 6

Entry Road Exit Road Hospital Turnaround Arrival Boulevard Hospital Arrival Plaza Sunken Garden Ramps To Underground Parking Sculpture Garden Fire Lane Healing Gardens Inside Atrium Mosque Garden Mosque Promenade Gazebo & Stair Tower Bus Stop Historic House Waterfall Clinic Drop-Off Clinic Gardens Medical School Connector North Clinic Drop-Off VIP Entrance Morgue Waiting Area Ambulance Entrance Emergency Drop-Off OB / GYN Drop-Off Helipad Water Feature

8 9

10

11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

Site map: Sidra Medical and Research Center

26 27

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 43

9. Energy and Utilities


9.1 Energy
The gradual recovery in the global economies during the start of 2011 has resulted in steady ow of investments in the hydrocarbons sector in GCC region. This recovery reassured the region to increase in its production capacity to meet the growing demand. Energy sector plays an important role in the GCC region as it is main source of revenue. The original planned investment in oil and gas sector within the GCC was around USD 420 bn till 2020. However, the revised planned budget was 4% lower compared to the original planned investments. The revised planned investment in the GCC is around USD 401 bn (refer exhibit 33). The drop in value is due to Kuwait, which has revised its budget downwards by around 30%. Saudi Arabia, on the other hand, has increased its planned investment by around 10% to USD 134.6 bn. The change in revised investment plans can be attributed to the petrochemical sector, where the Saudi Arabia is considering massive investments over the next decade. Qatar accounts for only 10% of the total planned investments in the oil and gas sector in the GCC. In the GCC, the amount of contracts awarded is about USD 156.4 bn, which is around 40% of the revised planned investment in the oil and gas sector (refer to Exhibit 34). UAE and Saudi Arabia are by far the largest markets for the oil and gas in the region. UAE has awarded USD 70.2 bn worth of projects, while Saudi Arabia has awarded USD 58.2 bn. Saudi Arabia, the worlds largest producer of oil, has announced massive investments during the next ve years as it wants to capitalize on the rising oil prices. UAE, on the other hand, believes that focusing and investing in the oil and gas sector would be the most appropriate to boost the overall economy, especially after the sharp correction in the real estate sector on the back of global recession. Exhibit 33: Value of planned investments in oil and gas projects (USD bn)
140 120 100 USD bn 80 60 40 20 0 8.9 Bahrain Oman Qatar Kuwait UAE Saudi Arabia 37.1 24.9 64.1 70.2 58.3 131.7 134.6

Exhibit 34: Contracts awarded in oil and gas projects


0.6 12.7 3.4 11.2 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

Source: MEED Projects

Source: MEED Projects

Exhibit 35: Natural gas reserves (Tncf)


Russia Iran Qatar Saudi Arabia U.S. 896 275 273 1,046 1,680

Source: Oil and Gas journal 2011

44 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

The hydrocarbon sector is the main contributor to the robust growth witnessed during the past few years. In terms of gas reserves, Qatar is the third-largest in the world behind Russia and Iran. It is the worlds largest global supplier of LNG and will become the worlds largest exporter of Gas-to-Liquids (GTL). The government will continue investing further to enhance its capacity to meet the rising demand in the gas sector. However, investments are likely to be much lower compared to past levels. Since 2006, Qatar has invested around USD 40 bn in the oil and gas sector. In Exhibit 36, majority of this was invested during the year 2006 and 2007 in order to achieve the desired capacity as mentioned above. In the year 2011, total amount of projects awarded in the energy sector was USD 2.9 bn, which is around 25% of the total projects awarded during the year. Exhibit 36: Oil and gas projects awarded in Qatar
25 21.5 20

USD bn

15 11.0 10

5 0.4 0 2006 2007 2008 2009 2010 3.1 7.9

2.9

2011*

Source: Oil and Gas Directory ME-2011 till date

Qatar started operation of mega train-7 (capacity 7.8 mtpa) in July 2009 and had brought another ve plants on-stream (46.8 mtpa) till Feb 2011. Qatar transportation company has 52 LNG vessel out of which 9 conventional vessels (145,000 154,000 m3), 31Q-Flex vessels (210,000 216,000 m3), 14 Q-max Vessels (263,000 266,000 m3). In 2011, Qatar achieved its target capacity of 77 mtpa for LNG. The governments investment in the energy sector is through Qatar Petroleum (QP), which is the only state owned petroleum company in Qatar. The company operates all oil and gas activities primarily including exploration, production, rening, transport, and storage. It is also involved in sale of crude oil, NGL, LNG, GTL, rened products, petrochemicals and fertilizers. QP accounts for about 50% of the countrys total crude oil output. Qatar petroleum has allocated USD 30.7 bn (2010-2014) for project in crude oil, natural gas, GTL and petrochemicals. However, the budget has been declining in gas sector as the expansion is nearing its completion. Gas-to-liquids (GTL) projects have received signicant attention in Qatar over the past several years. The government had originally set a target of developing 400,000 bpd (64,000 m3/d) of GTL capacity by 2012. The biggest GTL project in Qatar is Pearl GTL. In February 2007, the same week that Exxon Mobil decided to cancel its GTL plans, Shell held a ground breaking ceremony for its Pearl GTL project. The Pearl plant is 51% owned by Qatar Petroleum, though Shell will act as the operator of the project with a 49% stake. ORYX GTL is a synthetic fuel plant based in Ras Laffan Industrial City, Qatar, which is a JV between by Qatar Petroleum (51%) and Sasol (49%). The capacity of Oryx GTL is 34,000 bpd of oil. The facility is expected to use 1.6 bn cubic feet or 45 mn cubic meters per day (m3/d) of natural gas feedstock to produce 3.1mbd (499,000 cmd) of GTL products as well as 120,000 bpd (19,000 cmd) of associated condensate and LPG. Initially, the estimated cost of the project was USD 4 bn, which increased to between USD 12 and USD 18 bn. The Pearl GTL is the rst integrated GTL operation in the world, which will have upstream natural gas production integrated with the onshore conversion plant. By 2012, Qatar is likely to have 177,000 barrels per day (28,100 cmd) of GTL capacity from Oryx GTL and Pearl GTL.

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Timeline: Energy projects


QEWC / KAHRAMAA Ras Laffan IWPP Expansion Project Value: USD 3.0 bn Completion Date: Q3-14 Capacity: 4,200 MW 2013 Ras Laffan Polysilicon Plant Project Value: USD 1.0 bn Completion Date: Q2-13 2014 2015 KAHRAMAA - Facility D IWPP Project Value: USD 2.0 bn Completion Date: Q4-15 Capacity: 2,000 MW 2016 2018 KAHRAMAA Solar Power Complex Project Value: USD 1.0 bn Completion Date: Q3-18

Timeline: Oil and gas projects


QP - Al Shaheen Renery (On Hold) Project Value: USD 11 bn Completion Date: Q4-14 2013 Barzan Gas Development Onshore (Phase I) Project Value: USD 1.7 bn Completion Date: Q4-13 2015

Ras Laffan Olens Complex Project Value: USD 6.4 bn Completion Date: Q2-16 2016 2017

Barzan Gas Development Project Value: USD 10 bn Completion Date: Q4-21 2021

Qatargas - Jetty Boil Off Gas Recovery Project Value: USD 1.0 bn Completion Date: Q1-15

Barzan Gas Development Onshore (Phase II) Project Value: USD 2 bn Completion Date: Q4-17 Oryx - Gas to Liquids Plant (GTL) Phase II Project Value: USD 1.5 bn Completion Date: Q4-17 Shell - Petrochemical Complex Project Value: USD 2.0 bn Completion Date: Q4-17 Govt of Qatar/Govt of Kuwait Petrochemical Complex Project Value: USD 2.0 bn Completion Date: Q4-17

46 - COMMeRciALbANK cAPitAL - CONstRUctiON SectOR RePORt

9.2 Solar Energy


Winning the bid for FIFA World Cup 2022 has given a further llip to the solar energy sector in Qatar. In addition to the existing investment in the sector, major investments can be expected in the near term as the country prepares itself for the World Cup 2022. The ideas and concepts conceived from solar power are likely to ensure cooling and power control within the stadiums, which is very essential for the successful hosting of the event. As a result, Qatar is expected to invest about USD 1 bn on alternative energy. As of now, the country has awarded projects worth USD 0.7 bn. Qatar plans to build 9 new solar powered open-air stadiums designed by German Architects Albert Speer and Partner GmbH (AS&P), and renovate 3 existing stadiums.

Prototype: Qatar Solar Power Stadium

Electricity to cool these stadiums will be generated with photovoltaic panels (PV) and solar thermal collectors installed on the stadiums roofs and sides. Cool air will be pumped at spectators ankles, backs, and necks, and if permissible, the retractable roof can provide additional shade. Similarly, scientists and engineers at Qatar University have also developed a solar powered gas-lled cloud that will shade spectators and athletes from the roaring sun. In addition, the USD 0.5 mn articial clouds that can be positioned over any of the stadiums in Qatar and can be maneuvered with a remote control from the ground to keep the passing sun off the eld. Qatar Science and Technology will develop a plant at Ras Laffan Industrial City, which will be one of the rst operational polysilicon plants in the region. The plant will produce well over 3,500 tons per annum and has been designed with future expansion in mind. The solar energy will play an important role in successfully hosting the World Cup 2022 as the world will focus on Qatars to see if is able to deliver the cooling standards promised during the bidding stage.

9.3 Utilities
The GCC region is undergoing transformational changes in the utility sector due to rapid growth in population, commercial and industrial growth in the region. The governments of the GCC countries with the exception of Kuwait have embarked on a plan to restructure and privatize the sector. One of the other major developments in the power sector was the establishment of Power Grid Authority known as the GCC Interconnection Authority. The authority will be responsible for overlooking and monitoring of the GCC Power grid. The Grids existing members are Saudi Arabia, the UAE, Kuwait, Bahrain and Qatar (for Phase 1) with Oman joining the alliance for Phase 2. Saudi Arabia can give and receive 1,200 MW, while the UAE 900 MW and Qatar 750 MW to and/or from the grid. Members are expected to maintain a minimum reserve ratio level and negotiations for power trading (which is to commence next year) have already begun. It is estimated that the grid would save USD 5 bn in energy costs for member countries. All six countries have joined in the second phase of the USD 1.4 bn project which was formally initiated in April 2011. Exhibit 37: GCC desalination capacity (000 m3/d) Country Saudi Arabia UAE Qatar Bahrain Kuwait Oman
Source: MEED

2006 7,410 5,730 1,197 519 2,081 377

2011 12,564 9,030 1,676 1,183 3,466 1,140

2016 17,654 12,330 2,481 1,977 4,617 2,059

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 47

The total revised value of investment in the power and water sector in the GCC is USD 221.5 bn compared with USD 216.5 bn planned initially. According to Exhibit 38, the total value of planned investment in Saudi Arabia is USD 96.9 bn, largest market within the GCC. UAE is second largest market with a total investment of USD 57.8 bn. Qatar has a total planned investment of USD 16.8 bn. Exhibit 38: Planned investment in power and water
100 97 97

80 58

USD bn

60

55

40 27 29 20 7 0 Bahrain Kuwait Oman Qatar Saudi Arabia UAE Sum of Original Budget Sum of Revised Budget 7 14 14 18 17

Source: MEED Projects

The total planned investment in the water sector is USD 42.9 bn. Saudi Arabia is the largest market with planned investment of USD 16.9 bn. The country has awarded around USD 8.3 bn worth of projects, while the remaining is likely to be awarded in the coming years. UAE has planned investment of USD 8.4 bn, while USD 5.2 bn worth of projects has been awarded. Qatar is the third largest market in the GCC with planned investment of USD 6.9 bn. In 2011 so far, the total value of projects awarded in utility was USD 18.3 bn in the GCC (refer to Exhibit 39). Out of this, USD 10.8 bn worth of projects was awarded in Saudi Arabia, accounting for around 59% of the total value. Kuwait awarded USD 2.7 bn worth of projects, while USD 2.1 bn in the UAE. Exhibit 39: Projects awarded in 2011 (USD bn)
2.1 0.4 2.7 Bahrain Kuwait Oman Qatar Saudi Arabia UAE

1.9 10.8 0.5

Source: MEED Projects

48 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

In the GCC, Qatar is well placed in terms of meeting the rising demand in the near future. The government is investing in the power sector but in phases to ensure that the there is no excess capacity. Qatar as well as the other GCC nations faces the problem of high consumption of electricity compared to the global averages. One of the main factors could be the subsidies provided by the government of Qatar on the cost of power and water in the country. Electricity and water is free of cost to the nationals, which accounts for around 13% of total population. Qatar is among the top countries in GCC in promoting Public Private Partnerships (PPPs) in energy and utilities sector. The drive to increase private-sector involvement in the country stepped up in 2000, with the formation of Qatar General Electricity and Water Corporation (QEWC). In Qatar, the power sector plants are owned and operated by QEWC. The company is also responsible for meeting the consumption needs of Qatar. The power-generation segment of QEWCs business is privatized. However, it sells its products through long-term power and water purchase Agreements (PWPAs) to Kahramaa, which is fully owned by the Qatari government. Kahramaa is the Qatari utilities regulator responsible for transmission and distribution of electricity and water, development of policies and procedures for the management and supervision of the water and electricity sectors in Qatar. Qatar is planning to privatize the transmission and distribution segment, which would increase the transparency and efciency within the sector. In the past 20 years, QEWC has continued to expand its production capacity through fully and jointly owned plants. In 3Q 11, the company reached electricity generation capacity of 5,578 MW and water-desalination capacity of 265 million imperial gallons per day (MIGD), representing more than 60% and 70% of Qatars total power and water production capacities, respectively. In 2011, Qatar commissioned the USD 3.9 bn Ras Girtas power plant, which is expected to be one of the major power generation plants in the country located in Ras Laffan Industrial City. The plant is expected to produce 2,730 MW of electricity and 286,404 m3/d of desalinated water. Qatar holds 60% of the plant which is divided between QEWC (45%) and Qatar Petroleum (15%) and rest 40% is being held by Ras Qatar Energy Company. It is a 25 year contract between Ras Qatar and QEWC, according to which Ras Qatar will supply its production to QEWC which in turn will use it to supply to the local network or externally in the context of the GCC Electricity Link-up System. The total planned investment in power sector is around USD 9.0 bn. Total value of projects awarded was USD 3.7 bn since 2008, out of which USD 3.1 bn was awarded in 2008 and 2009. In 2011, three projects were awarded with a total value of USD 422 mn. The value of projects awarded accounted for around 6% of the total value of projects awarded in Qatar. There were a total of 19 projects awarded in the power sector compared to 338 projects in Qatar. Exhibit 40: Value of investment in power sector
1.8 1.5 1.2 USD bn 0.9 0.6 0.3 0.0 2006 2009 2010 2011 0.2 1.7 1.4

0.4

Source: MEED Projects

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 49

The total investment in the power sector during 2010 and 2011 (so far) has remained subdued especially as the major capacity is expected to come online in 2011. Power sector investments will continue to remain subdued as Qatar is well placed in terms of meeting the demand requirements. The expected investment in power sector is around USD 5 bn in the next decade. As a result, the excess capacity is likely to sold to other members of the GCC through Kahramaa, especially Sharjah and Kuwait as they are experiencing shortages. This process may be facilitated by the completion of the GCC Interconnection Power Grid. Qatar has already completed the rst phase of this project with the remaining two phases set to conclude this year. In Qatar, more than 75% of the water requirement is dependent on the supply of desalinated water. The average per capita consumption is estimated at 310 liters per person per day. Construction activity (preparation for World cup 2022) and the agricultural sector accounted for more than 70% of water demand in Qatar. Qatar has minimal groundwater reserves with an average rainfall of about 75 millimeters a year. Therefore, it is more than 99% reliant on desalination to meet its domestic demand. The desalination capacity in the region is expected to increase by 24% from current levels to reach 325 MIGD by the end of 2012. Exhibit 41: Investment in Qatar water sector
1.6 1.4 1.2 USD bn 1.0 0.8 0.6 0.6 0.4 0.2 0.0 2007 2008 2009 2010 2011 0.1 0.4 1.2 1.5

Source: MEED Projects

The Kahramaa has invested in water storage construction activity, undertaking a USD 2.75 bn reservoir project capable of holding seven days worth of fresh water as a backup for desalinated water supply. The 1.9 bn gallon facility will include a network of reservoirs connected by a 183 km, 2.5 m-wide pipeline linking the Ras Laffan desalination facility in the countrys north and the Ras Abu Fonts plant in the south. Treated wastewater contribution to the water supply is expected to rise from 0.05 bn cubic meters per year in 2011 to 0.065 bn cubic meters per year by 2015. Ensuring that more and more water in the country is re-used, the government of Qatar has formed a joint venture with Singapores Darco Water Technologies to build a USD 5 bn wastewater recycling plant for serving the small towns and villages of Qatar. The Public Works Authority (PWA) is responsible for the waste water and drainage projects in the country. The total planned investment in water sector is around USD 6.9 bn, which has been revised upwards from USD 5.2 bn. Total value of projects awarded was USD 3.8 bn since 2008. In 2011, three projects were awarded with a total value of USD 362 mn. The expected investment in water sector is around USD 3 bn in the next decade. Kahramaa has allocated USD 4.3 bn for two main pilot projects. The rst, a water production technology independent of power expected to be operational by 2012, will add 0.05 mn m3/d capacity to the system. The second is for a reservoir with 8,000 meter cube holding capacity to service the West Bay and Airport area in Doha.

50 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Timeline: Utilities projects


QEWC / KAHRAMAA RasLaffan IWPP Expansion Project Value: USD 3.0 bn Completion Date: Q3-14 Capacity: 235 mmgpd 2012 Qatar Transmission Phase VIII Project Value: USD 2.8 bn Completion Date: Q3-12 Qatar Transmission Phase IX Project Value: USD 2.0 bn Completion Date: Q1-12 Qatar Transmission Phase IX: Substation Package Project Value: USD 0.8 bn Completion Date: Q4-12 Doha North Wastewater Treatment Plant Project Value: USD 1.5 bn Completion Date: Q1-12 Doha and Rayyan Sewerage Project Value: USD 0.5 bn Completion Date: Q2-12 2013 2014 2015 KAHRAMAA - Facility D IWPP Project Value: USD 2.0 bn Completion Date: Q4-15 Capacity: 60 mmgpd KAHRAMAA - Water Security Mega Reservoirs Project Value: USD 2.0 bn Completion Date: Q4-15 2016

COMMeRciALbANK cAPitAL - CONstRUctiON SectOR RePORt - 51

10. Building Materials


10.1 Cement
The cement industry has undergone signicant expansion during the past few years on the back of massive investments in the construction sector. The cement sector is the biggest beneciary of the construction spending in general and the real estate sector in particular. The demand for cement in the GCC countries has given an entry option to new players in the region. In 2005, the region produced 48 mt of cement which further increased to 85 mt in 2010. Exhibit 42: World cement production
3,500 3,000 2,610 2,500 2,000 1,500 1,000 500 0 2006 2007 World Production 2008 2009 GCC Production as % of World 2010
1.8% 1.8% 2.2%

3,300 2,810 2,850 3,040

3.0%

2.6%
2.6%

2.2%

MT

1.9%

1.8%

1.4%

1.0%

Source: USGS and Commercialbank Capital Research

The two major cement producers in the region are Saudi Arabia and UAE. The UAE registered a CAGR growth of 16.6% from 11 mt in 2006 to 20.3 mt in 2010 (refer to Exhibit 43), which is the highest in the region. The countrys strong growth in production was driven by massive investment in construction during 2003 to 2008. Since then the country has witnessed the highest number of projects on hold or cancelled due to the overall liquidity crisis, which was led by the global recession. Saudi Arabia is the largest producer of cement in the GCC. During 2006 and 2010, cement production grew at a CAGR of 17.0% to 50.8 mt (refer to Exhibit 43). This healthy growth in production was on the back of massive public spending in the construction sector, especially the real estate sector. Exhibit 43: Cement production in the GCC
54.0 45.0 36.0 27.0 MT 20.3 18.0 9.0 0 0.8 1.0 Bahrain 2.0 2.5 Kuwait 16.0 50.8

40.0

4.0 5.1 Oman 2009 Saudi Arabia 2010 UAE

4.2 5.3 Qatar

Source: USGS and Commercialbank Capital Research

52 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Qatar is the third largest cement market in the GCC in terms of both consumption and production capacity. Historically, the cement production in Qatar was below the consumption and the excess demand was accommodated by importing from Saudi Arabia. Qatar National Cement Company (43% owned by Government of Qatar) was the only cement company in Qatar up until 2010, which enjoyed the monopoly in the market. But since 2010, two new companies entered the cement market due to capitalize on the construction activity, namely Al Khalij and Al Jaber Cement Industries. Exhibit 44: Qatar cement production
6.4 5.6 4.8 4.0 MT 3.2 2.4 1.6 0.8 0.0 2007 2008 2009 2010 Current 2.5 3.5 4.2 5.3 6.2

Source: USGS and Commercialbank Capital Research

The production of cement has increased over the years as the companies gear up for the ongoing construction activity. Currently, the companies are planning to further expand their production to prepare for the massive investment in construction sector. Majority of the construction will come from infrastructure and real estate sector, where cement sector is the direct beneciary. Qatars contribution to GCC production has increased from 4.9% in 2007 to 6.2% in 2010. We believe that this is likely to increase further as the companies gear to meet the rising demand in the next ve years. Qatars current production capacity stands at 6.2 mt. Qatar National Cement Company (QNCC) is the largest cement producer with a production capacity of 4.4 mt and a market share of around 70%. QNCC also announced that it is going to increase it cement capacity by 0.93 mtpa to 5.36 mtpa in the coming years. Al Khalij and Al Jaber have a market share of 24% and 5% respectively in the domestic market. Cement prices have been volatile in the GCC, especially in the UAE. However, the cement price in Qatar has been cement as it is controlled by the government. Going forward, we do not expect any volatility in the cement price and believe that it will continue to remain stable at current levels.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 53

The current production capacity of cement in Qatar is enough to absorb the demand. Going forward, we believe that cement consumption will grow at a CAGR of around 12% from 2011 to 2015 (refer to Exhibit 45). In our view, majority of the projects that are under construction or planned will be completed by the end of 2015. Exhibit 45: Qatar cement consumption forecast
16.0 15.3 14.2 12.0 12.2

MT

8.0 5.5 4.0 5.5

0.0 2011 2012 2013 2014 2015

Source: Commercialbank Capital Research, ConstructionWeek

Based on that assumption, we have forecasted the cement consumption in Qatar. We believe that the consumption will be at its peak in the years 2013 and 2014. Qatari cement companies are unlikely to match this demand, which means that the excess demand will be imported from Saudi Arabia and UAE. The outlook on cement sector in Qatar is positive on the massive investment in the construction sector backed by strong macroeconomic fundamentals.

54 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

10.2 Steel
The global steel industry has witnessed a boom and bust cycle in past few years. In past ve years, world steel production grew at a CAGR of 2.1%, while the GCC grew by 9% in 2010. The contribution of GCC to the world has remained same for the past four years (refer to Exhibit 46), indicating that the regions capacity expansion is line with global standards. In the GCC, there are 18 steel companies, engaged in production of raw steel and nished steel products. Steel consumption across the GCC region has increased underpinned by signicant investment in the construction sector. Exhibit 46: GCC steel production (000 MT)
1,500 1,247 1,200 900 600 300 0 2006 2007 World 2008 2009 GCC as % of World 2010 Sep -11 0.4% 0.5% 0.5% 0.5% 0.5% 1,347 1,329 1,417 1,232 1,136 1.0% 0.8% 0.6% 0.4% 0.2% 0.0%

0.4%

Source: World Steel Association

Exhibit 47: GCC steel production (000 MT)


6,000 4,690 4,000 5,015 3,959

2,000

1,970 1,448 1,503

90 90 90 Qatar 2009 Saudi Arabia 2010 Sep -11 UAE

Source: World Steel Association

Saudi Arabia is the largest market in not only GCC but the MENA region. Saudi Arabias Hadeed is the worlds 40th largest producer of steel with a production of around 5.0 mt.GCC countries will continue to remain a major consumer of steel products, which constitute 60.0% of the estimated demand as these countries continue to invest in its infrastructure and petrochemical sector to sustain economic growth.

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In the GCC, Qatar is witnessing the fastest growth in steel production during the past four years. The steel production capacity in Qatar grew at a CAGR of 15%, while it grew by 5.9% in the GCC (UAE, Saudi Arabia and UAE as shown in Exhibit 48). Qatar is increasing its production capacity to meet the rising demand underpinned by the planned investments in the next decade. Exhibit 48: Steel production in Qatar (000 MT)
2,000 1,970 35%

1,600 1,406 1,200 1,147


22.8% 19.5%

1,448
27.8%

1,503
27.1%

30%

25%

23.2%

800

20%

400

15%

0 2007 2008 Qatar 2009 2010 Qatar % of GCC Sep -11

10%

Source: World Steel Association

Qatar Steel, which is a wholly owned subsidiary of Industr ies Qatar (70% owned by the Government of Qatar), has emerged as one of the biggest players in MENA region with an annual production capacity of 2 mt per year. It is the second largest steel producer in the GCC, after Saudi Arabia Hadeed. Qatar Steel plans to enter new markets such as Egypt, Yemen and the Far East (Korea, China, and Indonesia). The company has decided to expand its steel making capacity by 1.1 mt per annum through a plant adjacent to its existing plant in Mesaieed. The plant is expected to start operations from rst quarter of 2013.

10.3 Aluminum
Exhibit 49: GCC aluminum smelters Country Bahrain Qatar Saudi Arabia Saudi Arabia UAE Company Alba Qatalum Maaden (Phase I) Maaden (Phase II) Emal Current Capacity (mt) Future Capacity (mt) Completion Year 0.87 1.4 2014 0.58 1.2 0.7 2013 0.72 2.4 2016 0.75 1.5 2014

Source: Gulf Aluminum Council

The GCC aluminum sector has become a major non-oil industry sector and contributor to economic growth. Currently, the GCC produces 7% of the worlds global production of aluminum (refer to Exhibit 50). The addition of new smelters and expansions in the pipeline, the regions production could reach 9 mn metric tons or 13% of global supply by the year 2020. Currently, the GCC building and construction industry consumes up to 400,000 tons of aluminum annually, making it one of the biggest markets for aluminum products in the region.

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Exhibit 50: Aluminum production in GCC (000 MT)


45,000 38,044 36,000 33,864
6.0%

36,856 39,584 40,752

8.0% 7.0%
6.9%

6.0% 5.0%

27,000

5.1% 4.6%

4.7%

4.0% 3.0% 2.0% 1.0%

18,000

9,000

0 2006 2007 World Production 2008 2009 GCC % of World GCC 2010

0.0%

Source: USGS

The total production of aluminum is likely to increase by 8.4% annually till 2014, which will take the total production to 4.2 mt. The demand for aluminum products in the construction sector is expected to increase at a CAGR of 9%, which means that GCC will continue to import to meet the excess demand on the back of massive investment plans in the construction sector. Qatar accounts for about 15% of the total production in the GCC. Qatar is expected to grow at a CAGR of 12% between 2010 and 2014, the fastest in the GCC region. We remain optimistic on Qatar Aluminum sector and believe that it will continue to witness strong demand on the back of massive investment plans in Qatar as it prepares for the World Cup 2022. Qatar Aluminum (Qatalum) is a 50-50 joint venture between Qatar Petroleum and the Norwegian company Hydro Aluminum. The plant has a production capacity of 585,000 mt per year. Qatalums complex facilities include a carbon plant, port and storage facilities, as well as a captive power plant. The company is planning to increase the production capacity and export to all countries as company does not have a specic quota. Dubai Aluminum Company Limited (DUBAL) is one of the largest industrial companies in the UAE, located in Jebel Ali. The company was established by Investment Corporation of Dubai in 1975. DUBAL is currently ranked as the 7th largest global producer in the industry with a current production capacity of 980,000 tons per annum by the end of 2010. Emirate Aluminum (EMAL) is a 50-50 JV between DUBAL and Mubadala Development Company. EMAL is a greeneld smelter development at Al Taweelah, Abu Dhabi. Commissioning of EMAL Phase 1 began in December 2009 and was completed by December 2010. The companys current production capacity is 750,000 tons per year. The company has USD 4.5 bn expansion plans, which will almost double its capacity to 1.3 mt per year.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 57

11. Methodology and Assumptions


Methodology
Step 1: Economic indicators was sourced from Qatar Statistics Authority and IMF (Forecast) Step 2: Initially, the list of projects ongoing and planned was compiled from various relevant sources. We decided to take data from one source due to the inconsistency from various sources. Step 3: Project data was further analyzed and categorized as follows: The data was re-classied based on the sectors that are being discussed and analyzed in this report. The residential project data was also re-classied in to residential, commercial, hotel and tourism based on description of each project under this category We have analyzed the start and end date for each project and calculated the remaining days left on each project. The number of days was divided by 90 to arrive at the remaining quarters left on each project The project value was appropriated based on project life. The allocation was done on per quarter basis. For example, if a USD 200 mn project started in Q3-09 and is set for completion in Q3-11, USD 25 mn is allocated per quarter. 2009 project value would be USD 25 mn, 2010 USD 100 mn and allocation for 2011 will be USD 75 mn

Step 4: We have taken the existing projects in the above format. We have added future investments to the existing projects based on the USD 225 bn announced by NDS. Step 5: Based on this assumption, we have created three scenarios, which are Base, Worst and Best case scenarios. Step 6: In each scenario, we have assumed a % of GDP based two growth stages. The forecasted GDP is taken from IMF until 2016, thereafter a 5% growth in GDP is assumed till 2020. The rst growth stage would be from 2013 to 2017, while the second growth stage would be 2018 to 2020

Total Construction size = planned/underway projects + planned by NDS + additional investments as a % of GDP

Scenario Assumption
In order to arrive at the total market size, we have added the contributions from three approaches as described above. This methodology was adopted to build three scenarios in our analysis to arrive at a market size. In each scenario, the base of USD 225 bn remains the same while following assumptions are made for each scenario: Base case: The optimum Scenario No projects cancellation or on hold is assumed during the projection period We have assumed additional investments as a % of GDP in two growth stages. The first is between 2013 and 2017 and the second is between 2018 and 2020 Worse case: Slowdown to impact the overall projects planned We have assumed a 15% drop in planned investments by the government due to the adverse effect of global slowdown No additional investments as a % of GDP Best case: Optimistic based on new sporting events No projects cancellation or on hold is assumed during the projection period We have assumed additional investments as a % of GDP in two growth stages. The rst is between 2013 and 2017 and the second is between 2018 and 2020

Data Limitations
Data discrepancies were witnessed for various projects. Therefore, we have taken the data from what we perceived as the most reliable source, which has been referred as the source throughout the report Since GDP estimates by IMF were available till 2016, we have taken a conservative growth rate of 5% per year until 2020.

58 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Construction Sector Report


Company Profiles
Public Companies Arabtec Holding Company 60 Atkins WS PLC 61 Barwa Real Estate Company 62 Chiyoda 63 Drake & Skull International 64 Ezdan Real Estate Company 65 Galfar Engineering 66 Hochtief 67 Hyundai Engineering and Construction Co. 68 Hyundai Heavy Engineering 69 JGC Corporation 70 Mazaya Qatar Real Estate Development Co. 71 Qatar Electricity and Water Company 72 Qatar Investor Group 73 Qatar National Cement Company 74 Private Companies 75 Al-Bader Construction Steel Works Al Jaber Engineering 75 Ashghal 76 Bechtel 76 China Harbour Engineering Company 77 Consolidated Construction Company 77 Habtoor Leighton 78 MIDMAC Contracting Company. 78 Msheireb Properties 79 Qatar Building Company 79 Qatar Diar Real Estate Investment Company 80 Qatari Diar Vinci Construction Company 80 Qatari Engineering and Construction Company 81 Qatar Foundation 81 Qatar Investment and Project Development Holding Company 82 Q. Mobility 82 Qatar Steel Company 83 Rabban Readymix 83 Saudi Binladin Group 84 Six Construct Qatar Ltd. 84 TAV 84

The Commercial Bank of Qatar (Q.S.C.)

Arabtec Holding PJSC


Company Overview Arabtec Holding is one of the major construction companies in the GCC region. It was established in 1975 in the UAE, and has 17 operational subsidiaries as of now. The company was primarily focused on the Dubai market, but the recession led to cancellations and delays, which resulted in a change in its strategy. As a result, the company now operates in Abu Dhabi, Jordan, Qatar, Russia, Saudi Arabia and Syria. Strategic partnerships are playing a key role in Arabtecs global expansion strategy. In Qatar, Arabtec has partnered with Nasser Bin Khaled Al-Thani & Sons Holding Company for the development of Al Waab City Business Description Arabtec operates in four business segments namely Building construction, Precast and Concrete production, Drainage and Electromechanical corks and Marine construction. Recent Developments The joint venture of Arabtec and Raheja Ltd was awarded a project of AED 750 mn to construct three mixed use projects in New Delhi and Gurgaon. In June 2011, the company signs a deal to build Qatar Trade Centre in Doha. The company awarded project of Al Waab City for AED 2.5 bn in Doha. Company Financials
AED mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: ARTC.DU/ARTC DB Market Data CMP (AED) Shares outstanding (mn) Market cap (AED mn) Market cap (USD mn) 52-week range H/L (AED) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Riad Burhan 5% Const. Holding Co. 5% Other Investor 35% Public 55%

1.6 1,495.0 2,421.9 659.4 1.8/0.5 49.0% 23.0%

Chairman / V.Chairman / MD Mr. Ibrahim Belselah Chairman Management Mr. Riad Kamal Board Member and Management, CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
4 300
200 100 0 Jan-09 Feb-10 Price AED Mar-11 Volume mn 3 2 1 0

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (AED) Book Value Per Share (AED) Dividend Per Share (AED)

9,721.7 9,459.7 2,117.9 1,255.5 757.4 11.0 61.0 13.4 0.6 1.3 0

7,664.7 9,110.5 2,728.0 956.9 634.1 8.0 23.1 5.3 0.3 1.6 0

5,463.7 8,680.1 3,102.3 737.1 588.1 7.8 12.1 3.5 0.2 1.8 0

3,542.1 8,338.0 3,179.0 567.4 580.7 3.9 3.0 1.1 0.1 1.9 NA

-13.8 -9.7 5.3 -34.1 -3.2 -63.5 5.6 NM

-25.0 -4.2 21.0 -23.4 -11.9 -43.0 19.4 0.0

16.2 0.9 NA

Segmental Revenues in 2010

Precast 1% * PE&P 1% Drainage & Scanff. 4% Contact 94%


* Plant, Equipment & Electricals

60 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Atkins WS PLC
Company Overview Atkins is one of the worlds leading engineering and design consultancies, and was established in 1938 by Sir William Atkins in London. It provides services to companies in more than 20 different sectors. It has ve segments: United Kingdom, North America, Middle East, Asia Pacic and Europe and Energy. The company has over 300 ofces around the world and employee strength of 17,700. Business Description The companys area of expertise lies in infrastructure such as buildings, transport and utilities (including energy and water). It works for national and local governments, and other industrial clients. Atkins designs intellectual capital such as management systems and business processes. It also designs physical structures such as ofce towers, schools, bridges and highways. It also helps in cost and risk planning, feasibility studies and logistics. Recent Developments In January 2012, Qatars Municipality and Urban Planning Ministry appointed Atkins to help establish and run its Central Planning Ofce (CPO). The new body will coordinate current and planned, road, metro and other major infrastructure schemes that will underpin Dohas 2030 vision. The contract will run for three years, with an option to extend to seven years, and is worth about USD 108 mn. A team of 100 consultants from Atkins will join the new government body. In November 2011, Atkins announced a five-year contract worth circa GBP 65 mn to help transform the roads and drainage systems in the Qatari capital, Doha. Atkins registered a 27% revenue growth in first half of 2012. Similarly, it reported a net prot growth of 19% in the same period. Company Financials
GBP mn unless otherwise mentioned Particulars 2009 2010 2011 6M-12 Y-O-Y CAGR(%) (%) (2009-11)

Reuters/Bloomberg code: ATKWL./ATK LN Market Data CMP (GBP) Shares outstanding (mn) Market cap (GBP mn) Market cap (USD mn) 52-week range H/L (GBP) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Black Rock Inc 10% Schroders pic 10% Newton Investment 6% Others 74%

759 104.4 795.4 1,251.7 831/480.7 NA NA

Chairman / V.Chairman / MD Allan E Cook Chairman Management Peter Michael Williams MD Uwe Krueger CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
1000
750 500 250 0 Jan-09 Jan-10 Jan-11 Feb-12 1 0 Price GBP Volume mn

9.5 11.4 3.8 0.9

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (GBP) Book Value Per Share (GBP) Dividend Per Share (GBP)

1487.2 828.7 -43.5 17.1 78.1 7.0 NA 11.1 0.9 -0.4 0.3

1387.9 875.6 -84.9 11.4 260.3 8.2 NA 12.0 1.1 -0.8 0.3

1564.3 997.8 16.3 53 121.5 6.9 NA 7.7 0.7 0.2 0.3

842.9 1049.7 69.7 112.1 138 NA NA 7.7 0.36 0.67 0.1

26.9 7.6 -165.3 -13.4 -60.7 20.0 -165.7 NA

2.6 9.7 NA 76.1 24.7 -7.1 NA 5.6

3
2

Segmental Revenues in 2011

Energy 6% UK 58% North America 17% Middle East 9% Asia Pacic & Europe 10%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 61

Barwa Real Estate Company


Company Overview Founded in November 2005, Barwa Real Estate Company (Barwa), is a leading real estate and investment company in Qatar with the aim of contributing towards the development of the country in tandem with the Qatari governments development plan, the Qatar Vision 2030. The company is headquartered in Doha, and has a presence in Qatar, the UK, North Africa and other GCC and European countries. Business Description Barwa is engaged in investing, developing and managing domestic as well as international real estate projects Barwas flagship projects include Barwa Financial District, Barwa Commercial Avenue, Barwa Al Sadd, Barwa Village, Barwa City, Masaken Al Sailiyah and Musaimeer The company has over 40 investments in five segments Real Estate Qatar, International, Business Services, Infrastructural Services and Financial Services. Barwa is engaged in hotel ownership and management, banking, project financing, advisory, advertising and brokerage services Recent Developments In November 2011, Barwa signed a lease agreement with Chinese company Dragon Mart to open a market for Chinese products in Barwas Commercial Avenue project. In October 2011, Barwa Real Estate Co. saw third-quarter net profit fall 71% to QAR 80.5 mn (USD 22.1 mn), as debt and obligations soared. USD 658.9 mn Barwa Al Sadd project is over 99% completed and is expected to be ready for handover during Q2, 2012. Barwa contracted with Qatar National Broadband Company to build a nationwide high-speed ber broadband network, as per which, the latter will install Fiber-toHome (FTTH) network at Barwa projects through a network of underground telecom ducts and lease it to operators to offer retail telecom services. Company Financials
QAR mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: BRES QA/BRES QD Market Data CMP (QAR) Shares outstanding (mn) Market cap (QAR mn) Market cap (USD mn) 52-week range H/L (QAR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern 29.6 389.1 11,654.3 3,200.6 39.2/27.2 25.0% 5.1%

Qatari Diar 45% Public 55%

Chairman / V.Chairman / MD Hitmi Ali Khalifa Al Hitmi Chairman Mr. Mohammed Abd Al Aziz Saad Al Saad V. Chairman Management Abdulla Abdulaziz Al Subaie Board Member and GCEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
60
40 20 0 Jan-09 Jan-10 Jan-11 Feb-12 Price QAR Volume mn

13.2 2.5 NA NA

8
6 4 2 0

Revenue 1,346.9 1,363.2 1,564.1 2705.1 Total Assets 24,317.1 34,892.8 73,982.2 65,806.1 Shareholders Equity 4,772.5 5,763.1 13,100.7 11645.0 Total Debt 12,476.4 20,050.8 24,179.0 28,569.5 Cash & Cash Equivalents 538.8 1928.0 12,983.1 3,439.2 Net Operating Margin (%) 24.0 -66.5 -278.2 37.9 ROE (%) 8.3 15.9 17.1 13.6 ROA (%) 1.5 2.6 2.6 2.3 EPS (QAR) 1.5 2.9 4.0 2.2 Book Value Per Share (QAR) 16.9 19.7 28.9 29.9 Dividend Per Share (QAR) 0.0 2.0 NA NA

0.2 1.3 13.3 -35.6 -72.1 -9.1 13.3 NM

7.8 74.4 65.7 39.2 390.9 66.3 30.6 NM

Segmental Revenues in 2010

Investing Activities 2% Real Estate 98%

62 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Chiyoda
Company Overview Chiyoda Corporation is an integrated contractor company established in 1948, with a paid up capital of yen 43,396 mn. The company has had its presence in Qatar since 1982. Chiyoda formed a joint venture with Technip for the development of RasGas III-Onshore Package. The company has built various plants and executed numerous projects in over 40 countries in different sectors, including petroleum and natural gas, chemical and petrochemical, pharmaceuticals, environmental conservation and general industries. The company is headquartered in Yokohama, Japan. Business Description Chiyoda primarily provides services in the field of engineering, procurement and construction for gas processing, reneries and other industrial plant projects, particularly for Gas Value Chain Projects. It is also involved in painting and insulation works as well as operation, maintenance and engineering consultancy services. Recent Developments In September 2010, Chiyoda awarded an EPC contract Helium Extraction Unit Facilities for RasGas Trains 6/7 and Helium 2 Project Utilities. The JV of Chiyoda and Technip has won EPC for the RasGas III-Onshore Package for QAR 4.3 bn and expected to be completed by Q2-13. Company Financials
JPY mn unless otherwise mentioned Particulars 2009 2010 2011 9M-12 Y-O-Y CAGR (%) (%) (2009-11)

Reuters/Bloomberg code: 6366.T/ 6366JP Market Data CMP (JPY) 787.0 Shares outstanding (mn) 259.1 Market cap (JPY mn) 201,491.2 Market cap (USD mn) 2,626.0 52-week range H/L (JPY) 1036.0/566.0 Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Mitsubishi Co. 33% Master Trust Bank 5% Others 62%

NA NA

Chairman / Vice Chairman / MD Mr. Yoichi Kanno Executive Vice President Management Mr. Takashi Kubota President and CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
1200 1000
800 600 400 200 Jan-09

Revenue 446,438.0 312,985.0 247,082.0 172,578.0 Total Assets 357,816.0 32,8174.0 353,392.0 339256.0 Shareholders Equity 145,917.0 149,253.0 155,758.0 159,891.0 Total Debt 10,058.0 10,039.0 10,233.0 10,195.0 Cash & Cash Equivalents 38,747.0 43,002.0 33,855.0 27,627.0 Net Operating Margin (%) 1.6 0.5 7.1 9.2 ROE (%) 5.7 2.0 5.3 5.7 ROA (%) 1.8 0.9 2.3 2.6 EPS (JPY) 25.6 11.4 30.8 33.3 Book Value Per Share (JPY) 561.1 573.6 599.2 614.9 Dividend Per Share (JPY) 7.5 3.5 11.0 NA

-6.4 2.3 4.5 -0.2 30.4 59.3 6.2 NM

-25.6 -0.6 3.3 0.9 -6.5 9.7 3.3 21.1%

24.3 1.3 NA 1.0

18 15 12 9 6 3 0
Mar-10 May-11 Volume mn

Price JPY

Segmental Revenues in 2010

Others 6% Engineering 94%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 63

Drake & Scull International PJSC


Company Overview Drake & Scull International (DSI) is a leading construction company in the GCC region and was established in 1966 in Abu Dhabi. DSI was listed on the Dubai Financial Market in 2009. The company has horizontal as well as vertical integration. Under its vertical integration, DSI established Drake and Scull Water and Power and developed telecommunication infrastructure while under horizontal integration, the company established Drake and Scull for Electrical Contracting Kuwait, DSI Jordan, DSI Libya, DSI Thailand and Drake and Scull Contracting. Business Description DSI is primarily engaged in contracting work related to the construction industry, such as electrical, plumbing, air-conditioning and sanitation work. The company operates in three major business segments, namely Mechanical, Electrical and Plumbing (MEP), Water and Power solutions and Civil Contracting. DSI operates in sectors including aviation, rail, healthcare, education, hospitality and district cooling. Recent Developments DSI has secured a series of Civil, MEP and W&P projects in Oman, Egypt, Kuwait, Saudi Arabia, UAE, Asia and Europe for a combined value of AED 3.4 bn and its backlog stood at AED 7.5 bn at the end of second half of 2011. In April 2011, the company acquired the International Centre for Contracting Co. (ICC) For SAR 128 mn in Saudi Arabia. The company recently won a MEP contract for AED 170 mn for Danat Al Emarat (Women and Childrens Hospital) as well infrastructure contract for the construction of a sewerage project for AED 75 mn. In June 2011, DSC won a MEP contract for a private residential facility for AED 100 mn in Qatar. Company Financials
AED mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: DSI DU/ DSI UH Market Data CMP (AED) Shares outstanding (mn) Market cap (AED mn) Market cap (USD mn) week range H/L (AED) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
KRT2 9% KRT3 9% Kahldon Rashid 8% HSBC 6% Public 67%

0.8 2,177.7 1,720.4 468.4 1.2/0.7 49.0% 8.0%

Chairman / V.Chairman / MD Mr. MajedSaif Al Ghurair Chairman Management Mr. Khaldoun Rashid Tabari CEO and Vice Chairman Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
1.5
1.0 0.5 0.0 Mar-09 May-10 Jul-11 Volume mn Price AED

10.9 0.7 NA NA

600
400 200 0

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (AED) Book Value Per Share (AED) Dividend Per Share (AED)

1,425.4 1,449.8 310.9 261.9 162.3 9.8 69.3 12.7 NA NA 0.0

2,211.7 4,400.6 2,515.4 663.4 1,160.3 9.0 24.1 11.4 0.2 1.1 0.1

1,854.6 4,870.6 2,541.8 789.4 705.2 6.3 6.3 3.3 0.1 1.1 0.0

2,230.5 5,586.3 2,678.3 732.8 621.2 6.2 5.8 2.8 0.1 1.2 NA

81.3 29.8 7.8 9.8 -7.5 29.5 8.5 NM

14.1 83.3 185.9 73.6 108.4 NA NA NM

Segmental Revenues in 2010

Civil Works 22% MEP 54% IWP 24%

64 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Ezdan Real Estate Company


Company Overview Doha-based Ezdan Real Estate Company (Ezdan) was established in 1960 as Thani Bin Abdulla Housing Group; subsequently, it was transformed into a limited liability company. In 2006, Ezdans real estate investments were transferred to a new entity Iskan Real Estate Company (renamed as Ezdan Real Estate Company). Ezdan was listed on the Qatar Stock Exchange in 2008. The company operates directly and through its subsidiaries Ezdan Trading and Contracting Company, Ezdan Hotel and Suites and Ezdan Real Estate Investment in Qatar. Business Description Ezdan contributes to infrastructure development in Qatar by complying with Islamic Shariah guidelines. The company is primarily involved in real estate property investment, development and management. Also, Ezdan offers real estate brokerage and business consulting services. The companys primary focus is on shopping malls and residential properties. Ezdans key projects include Ezdan Mall 1, Ezdan Mall 2 and Ezdan International School Ezdan Trading and Contracting Company contracts for buildings, road paving, trading building materials, electricity work and maintenance. Ezdan Hotel and Suites Company offers management services for hotels, suites and restaurants, while Ezdan Real Estate Investment is involved in real estate development. Recent Developments In June 2011, Ezdan sold two labor lodgings for QAR 516 mn. One at Al Sailiyyah and other at Al Mesaimeer. In April 2011, Ezdan announced the commencement of construction of its first commercial center, Ezdan Mall 1 in Al Gharafa, on an area of nearly 66,000 sqm. The company also announced plans to construct the tallest tower worldwide, subject to the procurement of land. In March 2011, Ezdan was in the process of selling a local real estate portfolio to a Malaysian investment fund for a consideration of QAR 1 bn. Company Financials
QAR mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: ERES.QA/ERES QD Market Data CMP (QAR) Shares outstanding (mn) Market cap (QAR mn) Market cap (USD mn) week range H/L (QAR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern 22.1 2,652.5 59,256.8 16,273.5 31.2/21.3 22.5% 0.0%

Public 23% Al-Tadawul Holding 77%

Chairman / V.Chairman / MD H. E. Sheikh Thani Bin Abdulla Bin Thani Al Thani Chairman Management Eng. Hesham Al-Sahtari MD Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
50 40
30 20 10 0 Jan-09

400.1 2.1 NA NA

400
300 200 100 0 Feb-10 Mar-11 Volume mn

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (QAR) Book Value Per Share (QAR) Dividend Per Share (QAR)

379.3 472.2 467.6 437.2 6,921.1 30,060.2 31,924.4 32,853.1 6,487.1 27,284.6 27,402.8 27,604.5 366.0 2,042.6 3,531.4 4,414.4 164.9 74.6 23.4 22.4 1.4 6.6 0.0 121.0 64.6 51.4 47.0 2.5 4.8 0.0 674.5 37.4 0.4 0.4 0.0 10.3 0.0 863.7 44.6 0.7 0.6 0.1 10.4 NA

33.5 4.5 0.5 45.5 35.4 14.3 0.5 NM

11.0 114.8 105.5 210.6 102.2 -81.8 25.1 0.0

Price QAR

Segmental Revenues in 2010

Investment Pro. 20% Hotels 12% Contracting 68%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 65

Galfar Engineering
Company Overview Galfar Engineering & Contracting SAOG (Galfar) is Omans largest construction company established in 1972. It was listed on the Muscat Securities Market (MSM) in 2007. Galfar has had successful partnerships with international design and construction rms like Petrofac, Snamprogetti, Bechtel, Daewoo etc. for the execution of large scaled projects. Galfar also has operations in Kuwait, India and Libya and has associates in Qatar and Abu Dhabi. Business Description Galfar Engineering provides engineering, procurement and construction services for oil and gas sector. The company also provides electrical, mechanical and civil contracting for infrastructure, environmental, residential and commercial buildings, and leases construction equipment, through a subsidiary. Recent Developments Galfar awarded the contract for construction of bridge from the Ministry of Regional Municipalities and Water Resources which has a budgeted value of OMR 1.2 mn. In June 2011, the company won a contract to build a pipeline that will link the renery complex of Oman Oil Reneries and Petrochemical Industries (Oman Oil RPI) with the methanol scheme of Oman Methanol Company (OMC). In 2010, the company successfully brought on line the Marmul, an expansion project for the Petroleum Development Oman. In March 2010, Galfar Engineering has won two healthcare contracts with a combined value of SAR 50.5 mn. Galfar recently awarded projects, including the Development of Salalah International Airport, Ras Al Hadd Airport, the Design, Build, Operation and Maintenance of the New Darsait Sewage Treatment Plant. Company Financials
OMR mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: GECS.MSM/GECS.OM Market Data CMP (OMR) Shares outstanding (mn) Market cap (OMR mn) Market cap (USD mn) 52 week range H/L (OMR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Salim Hamad 18% Al Siraj Invest. 13% Aimmar United 12% Others 18% Public 40%

0.34 330.0 123.5 320.7 0.6/0.3 70.0% 24.0%

Chairman / V.Chairman / MD Sheikh Dr. Salim Said Hamad Al Fannah Al-Araimi - Chairman Management Dr P. Mohamed Ali - Vice Chairman and Managing Director Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
0.8
0.6 0.4 0.2 0.0 Jan-09 Jan-10 Jan-11 Jan-12

19.1 1.3 NA NA

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (OMR) Book Value Per Share (OMR) Dividend Per Share (OMR)

363.0 371.1 84.1 107.6 1.9 7.7 31.3 7.3 0.1 0.3 0.02

410.3 368.3 82.7 98.5 1.8 1.7 4.6 1.0 0.0 0.3 0.01

367.4 420.7 85.7 116.7 1.7 3.2 7.2 1.5 0.0 0.3 0.01

239.4 391.4 85.7 118.8 2.0 3.3 3.9 0.8 0.0 0.3 NA

-10.0 2.7 3.1 10.2 137.3 19.8 -3.3 4.0 NA

0.6 6.5 1.0 4.2 -4.8 -35.3 -49.2 1.0 -18.9

8
6 4 2 0 Volume mn

Price OMR

Segmental Revenues in 2010

Construction 99%

66 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Hochtief
Company Overview HOCHTIEF is one of the leading international providers of construction-related services. The company has been listed on the Dow Jones Sustainability Index since 2006. The major shareholders are the Spanish Group ACS with 50.16% and Qatar Holding LLC with more than 10%. The Group has had a presence in Qatar since 2006 and has established ve subsidiaries namely as Hochtief ViCon, Hochtief Construction, Streif Baulogistik, Hochtief Facility Management and Hochtief Global Trade. Business Description The Group offer services in the fields of development, construction, concessions and operation covering the entire life cycle of infrastructure projects, real estate and facilities. Recent Developments In April 2010, Hochtief Construction formed a joint venture with Lusail Real Estate Development Company, a subsidiary of Qatari Diar. The JV of Qatari Diar and Hochtief Construction won the contract for development of Lusail City. The company in which the Hochtief subsidiary Leighton has a 45% share won new contracts in Qatar and Oman for a combined total of EUR 432.7 mn includes two projects - a shopping mall with ofce space and a highway The company is providing service to a number of project in Qatar such that Barwa Commercial Avenue, Qatar Bahrain Causeway, water supply, Dubai TowerDoha etc. Company Financials
EUR mn unless otherwise mentioned Particulars 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: HOTG.DE/HOT GR Market Data CMP (EUR) Shares outstanding (mn) Market cap (EUR mn) Market cap (USD mn) 52 week range H/L (EUR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern 46.3 73.6 3,556.6 4,600.5 76.9/19.3 N/A N/A

Public 37% ACS 53% Qatar Holng Leuxembourg 62%

Chairman / V.Chairman / MD Manfred Wennemer Chairman Management Dr. Jur. Frank Stieler - CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
80
60 40 20 0 Jan-09 Jan-10 Jan-11 Volume mn Jan-12

33.0 1.3 NA 4.5

Revenue 18,703.1 18,166.1 20,159.3 15,756.9 Total Assets 12,064.1 12,502.5 14,986.1 15,108.6 Shareholders Equity 2,826.2 3,264.1 4,264.2 3,953.2 Total Debt 2,926.8 2,843.5 3,222.7 3,346.3 Cash & Cash Equivalents 1,787.7 1,769.6 2,451.1 2,058.5 Net Operating Margin (%) 0.5 2.8 3.6 2.8 ROE (%) 7.4 9.4 11.2 -1.4 ROA (%) 1.4 1.6 2.1 -0.4 EPS (EUR) 2.3 2.9 4.3 -0.8 Book Value Per Share (EUR) 27.6 30.9 40.3 34.9 Dividend Per Share (EUR) 1.4 1.5 2.0 NA

10.9 7.8 12.4 -5.0 12.2 -138.0 0.3 NM

3.8 11.5 22.8 4.9 17.1 38.1 20.9 19.5

5 4 3
2 1 0

Price EUR

Segmental Revenues in 2010

Services 3% Americas 29% Asia Pacic 55% Europe 11% Real Estate 2%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 67

Hyundai Engineering and Construction Company


Company Overview Hyundai Engineering and Construction Company (HECC) was the former parent of Hyundai Group established in 1947, Koreas largest conglomerate which was broken up under government orders. The company is based in Seoul, South Korea. Business Description HECC engages in the construction of hydrocarbon processing plants, such as gas processing plants and gas eld developments, oil reneries and oil eld developments, petrochemical plants, fertilizer and chemical plants, oil and gas pipelines, terminals and storage tanks, and liqueed natural gas (LNG) liquefaction plants; and industrial plants, including LNG receiving terminals and supply pipelines, multipurpose water gate facilities, and integrated steel works. The company is also involved in the construction of power and desalination plants, and nuclear power plants, as well as other power projects consisting of transmission, substation, and industrial electricity In addition, it engages in the real estate leasing operations. Recent Developments HECC completes the GTL unit in Qatar which has a capacity of 1.6 bn cubic feet a day of converting natural gas into sulfur-free liquid fuel. In Dec 2010, Company awarded the project for construction of Hamad Medical City. In 2011, the company won contract to build a national museum at Qatar. The estimated cost of project is USD 434 mn. Company Financials
KWR mn unless otherwise mentioned Particulars 2008 2009 2010 2011 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: 000720.KS/000720 KS Market Data CMP (KRW 000) Shares outstanding (mn) Market cap (KRW bn) Market cap (USD mn) 52 week range H/L (KRW 000) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Korea Finance Company 11.1% Korea Exchange Bank 8.7% Woori Bank 7.5% Others 72.7%

81.9 111.4 9,120.0 8098.6 92.9/49.6 N/A N/A

Chairman / V.Chairman / MD Kin Jang Su Corporate Director & Board Member Management Son Hyo-Won- Vice President Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
20
15 10 5 0 Jan-09 Jan-10 Jan-11 Jan-12

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (KWR) Book Value Per Share (KWR) Dividend Per Share (KWR)

7,271,096.8 8,143,809.6 2,893,093.5 1,304,800.7 698,344.2 6.6 14.4 5.0 3,366.0 26,059.8 500.0

9,278,579.5 8,091,281.4 3,025,699.6 972,657.6 1,047,545.5 4.5 15.4 5.6 4,110.0 27,167.0 600.0

10,004,557.7 10,104,551.9 8,992,579.6 NA 3,555,900.6 NA 955,529.6 NA 1,413,286.0 NA 5.8 NA 16.1 NA 6.2 NA 4,763.0 NA 31,928.4 NA 700.0 NA

1.0 NA NA NA NA NA NA NA

17.3 5.1 10.9 -14.4 42.3 19.0 10.7 18.3

18.4 2.6 0.9 NA

100,000 80,000 60,000 40,000 20,000 0


Volume mn

Price KRW

Segmental Revenues in 2010

Nuclear 2% Plant 24% Power 21% Civil 21% Building 32%

68 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Hyundai Heavy Industries co. ltd.


Company Overview Hyundai Heavy Industries Co. Ltd. (HHI) is the world largest shipbuilding company established in 1972. The company is primarily engaged in heavy industries sector. It is a subsidiary of Hyundai Heavy Industries Group. HHI operates through its afliates named as Hyundai Samho Heavy Industries, Hyundai Mipo Dockyard, Hyundai Venture Investment, and Hyundai Futures.HHI primarily operates in Korea and has operations across the globe. The company is headquartered at Ulsan, South Korea. Business Description HHIs shipbuilding division (15% global market share) builds containerships, tankers, bulk/petrochemical carriers, drill ships, and speciality vessels HHI also offers offshore construction and exploration services, and has expanded into robotic systems and large industrial pumps and presses. HHI makes diesel engines and engine parts for industrial and marine applications Other HHI offerings include electric systems (circuit breakers, switchgear, transformers) and construction equipment (excavators, forklifts, and loaders). Recent Developments In 2011, HHI awarded the contract to execute the offshore part of Barzan Gas Project in Qatar for USD 900 mn. Company Financials
KRW mn unless otherwise mentioned Particulars 2008 2009 2010 2011 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: 009540.KS/009540 KS Market Data CMP(KRW 000) 325.0 Shares outstanding (mn) 76.0 Market cap (KRW bn) 24,700.0 Market cap (USD mn) 21,933.6 52 week range H/L (KRW 000) 554.0/235.5 Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Mong-Joon Chung 10.8% Hyundai Mipo 8.0% KCC 6.7% Others 74.5%

N/A N/A

Chairman / V.Chairman / MD Min Gye-Sik Chairman Management Oi-Hyun Kim CEO Jai-Seon Lee President & CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
600,000 500,000 400,000 300,000 200,000 100,000 0 Jan-09 4 3 2 1
0 Jan-10 Jan-11 Jan-12 Volume mn

Revenue 19,957,080.9 21,142,196.7 22,405,181.3 25,019,600.0 Total Assets 25,280,400.9 24,872,583.5 28,888,131.1 29,920,500.0 Shareholders Equity 5,595,219.5 9,808,401.2 13,819,032.5 14,719,300.0 Total Debt 3,314.6 889,556.5 3,447,283.7 3,962,700.0 Cash & Cash Equivalents 667,492.2 632,578.2 624,479.5 N/A Net Operating Margin (%) 11.1 10.5 15.4 N/A ROE (%) 40.7 27.9 31.8 N/A ROA (%) 10.7 8.6 14.0 N/A EPS (KRW) 37,340.0 35,705.0 61,807.0 N/A Book Value Per Share (KRW) 93,357.2 161,798.2 225,475.4 N/A Dividend Per Share (KRW) 5,000.0 3,500.0 7,000.0 N/A

11.7 3.6 6.5 15.0 N/A N/A N/A N/A

6.0 6.9 57.2 NM -3.3 14.3 28.7 55.4

6.8 1.5 2.2 1.5

Price KWR

Segmental Revenues in 2010


Others 1% Shipbuilding 35% Offshore & Eng. 15% Industrial Plants & Eng. 12% Engine & Machinery 13% Electro System 14% Constrauction Equipment 10%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 69

JGC Corporation
Company Overview JGC Corporation (JGC) established in 1928 and has developed into a globally recognized world leading engineering contractor. Currently the company has a place in one of four largest specialists in LNG projects. The company has the accumulated experience gained from over 20,000 projects performed in approximately 70 countries. JGC maintains a global network of satellite engineering centers to assure successful project execution anywhere in the world. Business Description The company major activities includes Consulting, planning, basic and detailed design, materials and equipment procurement, construction, commissioning, operation and maintenance services for various plant and facilities Investment in oil and gas field development projects and utility business Technology development services Recent Developments In 2011, The Company awarded EPC contract to build the gas processing facility for the Barzan Onshore Project in Qatar. In 2011, The Company acquired 40% participating interest in Shale gas project from Nexen Inc. Company Financials
JPY mn unless otherwise mentioned Particulars 2009 2010 2011 9M-12 Y-O-Y CAGR (%) (%) (2009-11)

Reuters/Bloomberg code: 1963.T/1963 JP Market Data CMP (JPY) Shares outstanding (mn) Market cap (JPY mn) Market cap (USD mn) 52 week range H/L (JPY) 2,508.0/1,460.0 Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Japan Trustee 9% Master Trust Bank of Japan 8% JGC Trading 5% Others 79%

2,189 259.1 567.1 7.1

N/A N/A

Chairman / V.Chairman / MD Yoshihiro Shigehisa Chairman Emeritus Keisuke Takeuchi - Chairman& CEO Management Koichi Kawana President and COO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
15
10

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (JPY) 123.2 Book Value Per Share (JPY) Dividend Per Share (JPY)

450,911.0 480,279.0 224,488.0 24,176.0 117,781.0 11.5 14.6 6.7 124.8 188.2% 885.6 30.0

414,257.0 430,176.0 246,140.0 23,678.0 83,308.0 10.1 11.5 6.0 107.3 -10.1% 972.5 21.0

447,222.0 468,502.0 264,483.0 21,640.0 131,894.0 14.2 10.0 5.7 100.8 1,045.4 30.0

389,361.0 501,118.0 280,535.0 8,637.0 172,780.0 12.0 11.1 6.2

-36.2% 9.2% 11.5% -59.1% 47.5% -

-0.4% -1.2% 8.5% -5.4% 5.8% -

16.1 2.0 NA 1.9

3000
2000 1000 0 Jan-10 Jan-11 Jan-12 Volume mn

1,109.1 NA

11.5% NM

8.6% 0.0

5 0 Jan-09

Price JPY

Segmental Revenues in 2010


Catalyst and ne product8% Others 3% Engineering 89%

70 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Mazaya Qatar Real Estate Development


Company Overview Mazaya Qatar Real Estate Development (Mazaya Qatar) develops, sells/purchases, rents and manages real estate properties in Qatar. The company was established in 2008 and was listed on the Qatar Exchange in October 2010. Mazaya Qatar undertakes real estate investment and development in accordance with the provisions of the Islamic law in the Middle East. Business Description Mazaya Qatar develops residential, commercial and industrial projects. The companys service and operations include: Real estate development Project management and consultancy Property valuation Strategic partnership Real estate brokerage Master developments Assets and facility management Marketing management and consultancy Real estate portfolio and fund management Real estate market research Mazaya Qatar has also been involved in projects covering architecture, professional building and engineering. Its agship projects include: Housing Complex for Qatar National Convention Centres employees, Sidra Residential Compound (Sidra Medical and Research Center), and Marina Mall Shopping Center. Recent Developments In June 2011, the company announced that it has joined the list of founding members of the Qatar Green Buildings Council. In October 2011, the company received the Best Real Estate Investment Strategy award at the 2011 Arabian Business Achievement Awards in Qatar Company Financials
QAR mn unless otherwise mentioned Particulars 2008 2009 2010 2011 Y-O-Y CAGR (%) (%) (2009-11)

Reuters/Bloomberg code: MRDS.QA/MRDS QD Market Data CMP (QAR) Shares outstanding (mn) Market cap (QAR mn) Market cap (USD mn) 52 week range H/L (QAR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Others 27% Qatar Foundation 21% Qatar Investment 17% Al Mazaya Holding CO. 5% Public 30%

7.7 100.0 782.0 214.8 10.5/7.4 24.9% 23.3%

Chairman / V.Chairman / MD Rashid FahadAl Naimi Chairman Management SerajSalehAl Baker CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
12 11 10 9 8 7
Oct-10 Price QAR Apr-11 Oct-11 Volume mn

NA 0.8 NA NA

5 4 3
2 1 0

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (QAR) Book Value Per Share (QAR) Dividend Per Share (QAR)

NA NA NA NA NA NA NA NA NA NA NA

36.4 527.8 515.6 241.2 67.3 7.1 6.9 0.3 NA NA

29.5 1,181.7 1030.3 138.0 678.2 50.9 2.9 2.5 0.2 10.3 NA

20.1 1101.4 1077.9 0.0 332.1 -29.8 4.6 4.3 0.5 10.8 NA

-31.9 -6.8 4.6 -100.0 -51.0 206.3 4.9 NA

-25.7 44.5 NM -100.0 17.3 25.7 NA NA

Segmental Revenues in 2010

Others Income 17% Rental Income 2% Financing Activities 81%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 71

Qatar Electricity and Water Company


Company Overview Doha-based Qatar Electricity and Water Company (QEWC) is an electricity and water company. Established in 1990, the company owns and manages power generation plants and water desalination stations to provide electricity and water in the State of Qatar. The Qatari government owns a 43% stake in the company, while the remaining is held by institutions and private individuals. Currently, QEWCs operations are limited to Qatar; however, the company intends to extend its footprint in other regional markets. Business Description QEWC is primarily engaged in the production of electricity and water. The companys power plants and desalination stations have the capability to meet the countrys requirement for electricity and water. QEWC has consistently increased its production capacity over the past two decades by establishing new plants and enhancing output of existing projects. The companys projects include major ventures such as Mesaieed A Power Station (2,007 MW) and Ras Girtas (2,730 MW). Following the completion of ongoing projects, the companys contribution to total power generation and water desalination capacity in Qatar is expected to increase to more than 60% and 70%, respectively. Recent Developments In October 2011, QEWC posted a 10% drop in third quarter net profit to QAR 328.2 mn (USD 90.1 mn) compared with QAR 364.8 mn posted in the year earlier period. In August 2011, QEWC was assigned a rating of A1 by Moodys. In July 2011, the company signed an agreement with Oman Power and Water Procurement Company to start the construction of the Sur Independent Power Project in Oman. Once completed, the project would have a total capacity of 2,000 MW. Company Financials
QAR mn unless otherwise mentioned Particular 2008 2009 2010 9M-11 Y-O-Y CAGR (%) (%) (2008-10)

Reuters/Bloomberg code: QEWC.QA/QEWS QD Market Data CMP (QAR) 141.3 Shares outstanding (mn) 100.0 Market cap (QAR mn) 14,180.0 Market cap (USD mn) 3,894.2 52-week range H/L (QAR) 154.9/116.0 Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Govt. of Qatar 43% QP 11% QNB 6% QIC 1% Public 39%

25.0% 0.0%

Chairman / V.Chairman / MD Mr. Abdullah bin Hamad Al-Attiyah Chairman Management Mr. Fahad Hamad Al-Mohannadi General Manager Mr. Abdul Sattar Al-Rasheed CEO Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
200
150 0.5 100 50 Jan-09 Feb-10 Mar-11 Volume mn Price QAR 0

10.3 4.1 4.3 0.8

Revenue 2,272.9 2,650.9 3,430.2 3,209.3 Total Assets 13,587.6 18,048.0 22,123.4 21816.9 Shareholders Equity 1,307.6 3,589.7 3,938.4 3,717.1 Total Debt 8,289.9 12,054.8 14,416.7 14,229.1 Cash & Cash Equivalents 1,614.9 2,307.0 2,074.2 2,185.6 Net Operating Margin (%) 33.4 35.9 40.0 44.8 ROE (%) 30.2 38.6 31.6 45.8 ROA (%) 6.6 6.0 5.8 6.6 EPS (QAR) 7.6 9.5 11.6 10.0 Book Value Per Share (QAR) 13.1 35.9 37.6 34.8 Dividend Per Share (QAR) 4.5 5.0 6.0 6.0

53.1. 13.6 42.7 8.2 -9.5 48.8 37.9 20.0

22.8 27.6 73.5 31.9 13.3 23.9 69.6 15.5

Segmental Revenues in 2010

Lease Income 15% Electricity 53% Water 32%

72 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Qatar Investor Group


Company Overview Qatar Investor Group formerly known as Gulf Holding Company (Q.S.C.), is primarily engaged in the production and sale of cement. The company is also involved in building factories, importing/exporting cement, investing in shares and real estate, and installing and maintaining solutions for mechanical, electrical and electronic security equipment. Incorporated in May 2006, the company has diversied its business into various new sectors across the Gulf. Al-Khalij operates through its afliate Qatari Investors Group that owns 19 entities (as of June 30, 2011). Business Description Al-Khalijs industrial and investment operations are managed through its affiliate Qatari Investors Group. The company reports revenues under two operating segments: cement (accounted for 82.3% of total revenues in 1H 2011) and contract and service income (17.1%). The companys product portfolio includes ordinary portland cement, sulphate resistance cement, portland slag cement and building material. Under its Green Field Cement Project, the company has a clinkerisation unit that has a guaranteed daily capacity of 5,000 metric tons (production is based on modern rotary kiln technology that adopts nature friendly environment protection strategies). Recent Developments Al-Khalij Cement Co., Al-Khalij Holdings subsidiary, obtained a conformity certicate with specied requirements of the Qatar Construction Specication from the Ministry of Environment, Quality and Conformity Department. In May 2011, the company obtained a conformity certificate for technical requirements in the elds of construction and building products manufacturer/ supplier. Company Financials
QAR mn unless otherwise mentioned Particulars 2008 2009 2010 2011 Y-O-Y CAGR (%) (%) (2009-11)

Reuters/Bloomberg code: KHCD.QA/KHCD QD Market Data CMP (QAR) Shares outstanding (mn) Market cap (QAR mn) Market cap (USD mn) 52 week range H/L (QAR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern 15.2 124.3 1,889.7 519.0 18.9/13.0 23.3% 6.4%

Others 23% Public 77%

Chairman / V.Chairman / MD HE Abdulla Nasser Al-Misnad Chairman and MD H.E. Sh. Hamad Bin Faisal Al-Thani Vice Chairman Management HE Abdulla Nasser Al-Misnad Chairman and MD Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
25
20 15 10 Jan-09 Jan-10 Jan-11 Vol mn Jan-12 Price QAR

23.8 1.0 3.3 NA

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (QAR) Book Value Per Share (QAR) Dividend Per Share (QAR)

11.0 1,674.8 874.2 571.2 507.7 -149.1 3.9 2.7 0.4 10.9 0.0

26.6 2,667.9 1,852.3 679.9 150.5 -20.8 5.3 3.3 0.6 14.9 0.0

158.9 3,489.3 1928.4 1410.8 708.6 12.1 3.8 2.3 0.6 15.5 0.5

194.2 3056.1 1935.8 986.6 115.9 10.8 3.8 2.3 0.6 15.6 0.5

22.3 -12.4 0.4 -30.1 -83.7 5.3 0.4 0.0

170.1 7.0 2.2 20.5 -12.2 1.7 2.2 NM

6
4 2 0

Segmental Revenues in 2010

Contract & Service 23% Cement 77%

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 73

Qatar National Cement Company


Company Overview Established in 1965, Qatar National Cement Company (QNCC) is a Qatar-based public shareholding company operating in the construction materials sector. Headquartered in Doha, QNCC has setup manufacturing units at Umm Bab and Mekenis in Qatar. The company was established to produce ordinary Portland cement in the country. Subsequently, the company began production of: Sulphate resistant cement Calcined and hydrated lime and Washed sand Business Description In 1969, QNCC commenced commercial cement operations from the first production line based on Semi Dry Process with a capacity of 100,000 tpa. The second and third lines, with the same capacities each, were set-up and commercialized in 1974 and 1976, respectively. Through the years, the company has ramped up three additional cement plants in Qatar. In 1978 and 1985, the company diversied into Calcined Lime and Hydrated Lime, respectively. In 2003, QNCC purchased a washed sand plant and is periodically upgraded / expanded. Recent Developments The company commenced trial operations at its QAR 22 mn calcium carbonate plant based in Umm Bab. The plant would specialize in producing calcium carbonate for usage in water treatment operations and have a production capacity of 250 tons per day. QNCC signed an agreement with Kahramaa to purchase calcium carbonate for 25 years. QNCC signed an agreement with Stream Industrial Engineering Company to construct a calcium carbonate plant on turn-key basis. The Ras Girtas power station at Ras Laffan would be one of the supporting stations for the plant. Company Financials
QAR mn unless otherwise mentioned Particulars 2008 2009 2010 2011 Y-O-Y CAGR (%) (%) (2009-11)

Reuters/Bloomberg code: QANC.QA/QNCD QD Market Data CMP (QAR) Shares outstanding (mn) Market cap (QAR mn) Market cap (USD mn) 52-week range H/L (QAR) Foreign Ownership (%) Limit Allowed (%) Current Exposure Shareholding Pattern
Govt. of Qatar 43% Public 57%

112.0 49.1 5499.0 1483.3 118.0/95.5 14.2% 2.1%

Chairman / V.Chairman / MD Salem Bin Butti Al-Naimi Chairman and MD Mr. Sulaiman Khalid Al Mana Vice Chairman Management Mohammad Ali Al Sulaity General Manager Key Ratios P/E (x) P/BV (x) Dividend Yield (%) PEG (x) Price Performance
150
100 50 0 Jan-09

13.2 2.5 4.9 0.6

Revenue Total Assets Shareholders Equity Total Debt Cash & Cash Equivalents Net Operating Margin (%) ROE (%) ROA (%) EPS (QAR) Book Value Per Share (QAR) Dividend Per Share (QAR)

1,413.0 2,853.1 1,642.5 874.4 4.6 17.3 25.2 16.6 8.4 33.5 2.9

1,519.1 2,526.2 1,922.9 489.5 54.3 20.7 23.4 15.5 8.5 39.2 5.5

1,090.2 2,607.8 2,159.7 324.1 99.8 41.5 22.9 18.2 9.5 44.0 5.5

989.6 2618.8 2315.0 163.9 254.6 42.7 19.9 17.0 9.1 47.2 6.0

-9.2 0.4 7.2 -49.4 155.1 -4.3 7.3 10.0

-19.3 1.8 9.7 -42.1 116.6 3.5 9.8 4.9

250 200 150


100 50 0 Jan-10 Jan-11 Jan-12 Volume mn

Price QAR

Segmental Revenues in 2010

Cement 100%

74 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Al-Bader Construction Steel Works


Company Description Al-Bader forms an integral part of the Al Aafaq Group of Companies. Established in 1997, Al-Bader Construction & Steel Works is a Civil Engineering Contractor and supplier of fabricated structural steel. The Company provides construction services for residential, commercial and industrial requirements and also experts in steel construction business particularly in pre-engineered building. Projects
Project Name Description

Key Personnel Board of Directors Ahmed E. Seddiqi Al Emadi Chairman Management Peter Ward - General Manager

Al Shaqab Academy

The company got the contract for Design, Supply and Installation of Standing Seam Roof System and Ceiling Soft in the Academy. The budgeted cost of QAR 114 mn. The company awarded the contract for Design Supply & Erection of three warehouses including civil, structural & nishing works. The estimated cost of project is QAR 53 mn.

Logistic Village Qatar

AlJaber Engineering (JEC)


Company Description AlJaber Engineering (JEC) is a leading general contractor established in 1995 in Qatar. JEC has executed several large-scale turnkey projects in different sectors including Highways, Roads and Infrastructure, Oil and Gas, Petrochemical and Industrial, Power Generation, Sewage Treatment Plants and Pumping Stations. The companys primary activities are Civil and electromechanical contracting for industrial, petrochemical, oil and gas, infrastructure and building projects etc., engineering and business consultancy services and construction machinery and equipment. Projects
Project Name Description

Key Personnel Board of Directors Mohammed Sultan AlJaber Chairman Hisham Hadid Director Jaber Sultan AlJaber Director Management Osama Hadid Managing Director Amr Nadim Executive Manager, Construction Alex Calfat Executive Manager, Engineering

Barwa Financial District It is a joint venture project with Bouygues and Midmac Contracting situated in Dohas new business district in West Bay with approximately built up area of 700,000 sqm. The project cost is USD 1.3 bn and will be completed by March 2013. Public Works Authority The project includes refurbishment and upgrading (Ashghal) works for various foul and storm water pumping stations including civil, mechanical, and electrical and HVAC works. The project cost is USD 53.2 mn and it will be completed by January 2014.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 75

Ashghal
Company Description Ashghal was established in 2004 on the basis of the Emiri Decree No.1 issued by HH the Emir Sheikh Hamad Bin Khalifa Al-Thani to supervise all infrastructures related projects as well as public amenities in the State. The Emiri Decree focused on quality and perfection of projects as per international specications and standards. There has been a rapid increase in construction projects in the last few years, such as the Olympics Village, Doha International airport, Al Asiri Interchange, Gharafa Interchange, Salwa International highway. Projects
Project Name Description

Key Personnel Management Nasser Ali Abdullah Mawlawi President and General Manager Saad Ahmad Al-Misnad Director, Infrastructure Affairs Mohammad Ali Darwish Director, Asset Affairs Khaled Mohammed Al Emadi Quality, Safety and Environment Manager Abdulhamid Ali Radwani Acting Manager, Building Affairs Jamal Shareeda Al Kaabi Acting Manager, Drainage and Road Design Zayed Mansour Al Khayarin CEO

Ashghal-Doha and Rayyan Sewerage

ASHGHAL plans to expand the sewerage system in Doha. The extension of the facility in Doha will manage the ow from approx. 500,000 people in Ain Khalid, Musaimeer, HBK and West Abu Hamour areas enhancing the local urban environment. The budgeted value of project is USD 500 mn and will be completed in Q2-2012.

Ashghal Doha, Lusail The project will construct a 450 km long highway, and Dukhan Expressway 53 interchanges and 12 intersections. Construction will start in Q2/2012 and is expected to complete in Q4/2015. The estimated budget for project is USD 1,000 mn. Ashghal-Hamad Medical City The project will cover an area of 450,000 sqm and will comprise three hospital, a National Health Authority ofce building, residential buildings, educations center, and recreational facilities. The estimated budget for the project is USD 200 mn and it is expected to be completed by Q2/2013.

Bechtel
Company Description Bechtel is an engineering, construction and project management company. The company has executed 23,000 projects in 140 countries since its inception. The companys primary activities include engineering, procurement and construction for oil and gas, infrastructure, buildings, petrochemical, mining and metals, power and utilities projects and engineering consultancy services. The company earned USD 27.9 bn revenue in 2010 and had an order book of USD 21.3 bn. Projects
Project Name Description

Key Personnel Board of Directors Riley Bechtel Chairman and CEO Adrian Zaccaria Vice Chairman Andy Greig Director Steve Bechtel Director Bill Dudley Director Scott Ogilvie Director Peter Dawson Director John McDonald Director Mike Adams Director Michael Balley Director Jack Futcher Director

New Doha International Bechtel is the leading consultant and advisor for the Airport (NDIA), Qatar project. The company also won EPC and PMC contract. The airport will have capacity of 50 mn passengers, 2 mt of cargo and 320,000 aircrafts per year. The estimated cost of the project is USD 11 bn and is expected to be complete in Q1-15. QRDC - Qatar Integrated The company is the PMC bidder. The project will Rail Project, Qatar include construction of a 345 km long railway line and associated facilities. The EPC will be awarded in Q1-13 and expected to be completed in Q2-20. The estimated cost of the project is USD 20.6 bn.

76 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

China Harbour Engineering Company Ltd.


Company Description China Harbour Engineering Company Ltd. (CHEC) is a world-renowned international contractor that is a subsidiary of China Communications Construction Company Ltd (CCCC).CHEC is focused on basic infrastructure construction, such as Marine Engineering, Dredging and Reclamation, Road and Bridge, Railways, Airports, Complete Plant, and other works. CHEC Headquarters are located in Beijing, China and has 40 overseas branches. The company provides services in ve core areas named as survey and design, marine engineering, road and bridge construction, dredging and reclamation, and port machinery manufacturing. Projects
Project Name Description

Key Personnel Board of Directors Sun Ziyu Chairman Wang Jiayin Board of member Sun Guoqiang Board of member Zong Yuanyuan Board of member Zhu Lixiang Board of member Management Mo Wenhe President Wang Jiayin Vice President Wang Bo Vice President and Chief Economist Lin Yichong Vice President

New Doha Port

The company awarded the project of New Doha Port have a budgeted value of USD 879 mn and expected to complete in Q-23. The rst phase will give the port a capacity of two million 20-foot equivalent units (containers) per year for 2014.

Consolidated Construction Company


Company Description Consolidated Contractors Company (CCC) was established in 1952 and is ranked as the largest contractor in the Middle East. The (CCC) provides services for oil and gas, and petrochemical segment, pipelines, building and civil engineering segment, marine segment, and roads. It specializes in providing EPC solutions such as project development, start up, and operation and maintenance. In addition CCC offers services to industries, government ministries, national oil companies, and private clients. The operations of the company are spread across several countries in the Middle East, Africa, Europe, Asia, Caribbean, South and Central America. The company is headquartered in Athens, Greece. Projects
Project Name Description

Key Personnel Board of Directors Said T. Khoury Chairman and President Tawc S. Khoury Director, Executive Vice President Samer S. Khoury Director, Executive Vice President, Operations Suheil H. Sabbagh Director, Group Human Resources Mahmoud Zeibak Advisor & Board Director Mohammed Seoudi Advisor & Board Director

NDIA - Doha International Airport

The new airport will have capacity of 50 mn passengers, 2 mt of cargo and 320,000 aircraft landings and takeoffs each year. It will be three times the size of the existing airport in Doha and will cover an area in excess of 22 square km. The EPC contract is awarded to CCC along with several contractors including JEC, Al jJaber Trasport, Arabian Benmco contracting co, Bechtel co, CAT International, CCM, FKI Logistex, Gulf Contracting co.etc. The budgted cost of project is USD 2.8 bn and will complete in Q4-12. The company won an EPC contract for the project along with other contractors. The project will expand capcity to facilitate export of about 77 mn tons of LNG and will have capacity of 5,000 ships.The estimated value of project is USD 1.9 bn and expected to complete in Q1-12.

QP - Ras Laffan Port Expansion - Berths and Port Infrastructure

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 77

Habtoor Leighton
Company Description The Habtoor Leighton Group (HLG) is one of the leading diversied international contractors in the MENA region and was formed in 2007 following the merger of Al Habtoor Engineering with Gulf Leighton. HLG focus on ve major sectors namely Infrastructure, Building, Rail, Oil and Gas and Mining. Habtoor Leighton operates through three separate business units: United Arab Emirates, Qatar and Bahrain, and New Markets and each business unit comprise a number of divisions. The company major activity includes civil contracting for buildings and infrastructure projects, electromechanical, engineering consultancy and offshore contracting for the oil and gas sector, mining, and real estate property management. In 2009, Al Habtoor Leighton established Al Habtoor GETTCO Qatar, a holding company with subsidiaries in civil contracting, electromechanical and plumbing services. Leighton Holdings holds 45% stake, Al Habtoor Group 27.5% and Riad Touc 27.5% in the Group. Projects
Project Name Description

Key Personnel Board of Directors Raid T. Sadik Chairman Laurie Voyer CEO & Managing Director Mohammed Al Habtoor Director Hamish Tyrwhitt Director Tony Saadie Executive General Manager Suheil Al Rayes General Manager, Building Dale Burtenshaw General Manager Infrastructure

Duhail and Umm Qarn Reservoirs

The Duhail Water Station project covers construction of six concrete reservoirs, a pump house, associated buildings, road works and installation of a 15.9 km water distribution pipeline. The Umm Qarn Water Station project includes the construction of three concrete reservoirs, a pump house, associated buildings, road works, landscaping and installation of 700 meter water distribution pipeline. The project includes the construction of ve towers with a direct link to the existing Doha City Centre. The project is divided into three phases and has a total builtup area of around 330,000 sqm. The budgeted value of the project is USD 325 mn.

Doha City Centre Expansion

MIDMAC
Company Description MIDMAC Contracting Co. W.L.L. (MIDMAC) is one of the largest Qatari contracting organizations established in 1975.The company operated as a wholly owned subsidiary of Qatar Investment and Project Development Company as QIPCO acquired major stock in 2005.The company major activity includes civil and electromechanical contracting for buildings, infrastructure, oil and gas, water and petrochemical projects; production of asphalt and concrete blocks; manufacture of reinforced steel bars; leasing of construction equipment; interior and landscape design services. The company has an annual turnover approximately USD 350 mn. Projects
Project Name Description

Key Personnel Board of Directors Chairman - HE Sheikh Hamad Bin Abdullah Bin Khalifa Al-Thani Mohamed Ali M.K. Al-Kubaisi Board Manager Raghib H. Kublawi Director Management Mohammed Ali Mohammed Managing Director Khamis Al-Kubaisi Ragheb H Kublawi General Manager

Qatar Foundation Headquarter

The project will cover an area of about 29000 sqm which consist a 14-story building and three-four story study center. The estimated cost of project is USD 275 mn and expected to complete in Q3-13.

NDIASC - Expansion of The project include construction of a ve-storey NDIA - Phase 3 passenger terminal consist of gross oor area of 127,000 sqm, 100 room hotel, two-track people moving system and a commercial area etc. The estimated cost of project is USD 687 mn and expected to complete in Q2-13.

78 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Msheireb Properties
Company Description Msheireb Properties is a subsidiary of Qatar Foundation for Education, Science and Community Development. The company was set up in April 2007 and it was formerly known as Doha Land. Msheireb primarily activities include Real estate property investment, development and management and management of hotels. Msheireb Properties is a supporter of Qatar Foundations objectives and ideals which will create leading edge urban living concepts that build on traditional Arabian architecture and design and contribute to the social and cultural heritage of Doha. The company is working with some of the worlds leading master planners, architects, engineers and designers to create and regenerate cities to serve the immediate needs of communities and in the future. Projects
Project Name Description

Key Personnel Board of Directors HH Sheikha Moza bint Nasser Chairperson HE Abdullha Al-Kubaisi Vice Chairperson Rashid Al-Naimi Director Saad Al Muhannadi Director Norman Lyle Non - Executive Director Management Issa M. Al Mohannadi CEO C S Chandrasekaran CFO John Rose Development Director Mohammed Masoud Al-Marri Projects Director

Msheireb Properties - Musheireb

The project will spread over 750,000 sqm consist of 226 buildings, 13,700 parking lots, retail, cultural and entertainment areas. The project will provide home to 27,637 residents. Mshereib properties and Turner International Middle East formed a joint venture, TIME Qatar, which will be an independent project management company. The estimated value of project is USD 5.5 bn and expected to complete in Q4-16. The project will include demolition of old structure in area like Al Bida, Wadi sail, Jaidah tower etc. and construction of new villas and towers (18 storey). The construction project will be awarded in Q3-12 and expected to complete in Q2-15. The estimated cost of project is USD 270 mn.

Msheireb Properties - Old Doha Facelift

Qatar Building Company


Company Description Qatar Building Company was founded in 1971 as a general civil engineering and building contractor. The company major activities includes civil contracting for infrastructure, building sand heavy industries, manufacture of asphalt and concrete products; distribution, leasing and maintenance of heavy construction equipments and spare parts; manufacture of precast pipes and pipelines installation. The company has a capacity of 400 cubic meter of concrete per hour and 800 tonnes of asphalts pavements per hour. Projects
Project Name Description

Key Personnel Board of Director Mohammed Tayyeb Hashim Mustafawi Chairman Abdulhamid Mohammed Tayyeb Hashim Mustafawi Vice Chairman Abdulhakim Mohammed Tayyeb Hashim Mustafawi Director Khaled Mohammed Tayyeb Hashim Mustafawi Director Adel Mohammed Tayyeb Hashim Mustafawi Director Ahmad Mohammed Tayyeb Hashim Mustafawi Director Management Ali Mohammed Tayyeb Hashim Mustafawi Managing Director

GFH - Energy City Qatar- Phase 1

The company awarded the EPC contract for Energy City which includes the construction of ECQ headquarters, Infrastructure & installation works, Education centre, Shipping centre, Oil and gas producers centre etc. The estimated cost of the project is USD 58 mn and expected to complete in Q1-2015.

Primary Routes Project: The company awarded EPC contract for the Doha Expressway: construction of 3.5 km long road which is the part of Package 6 Doha expressway. The budgeted cost of the project is USD 200 mn and expected to complete in Q4-2013.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 79

Qatari Diar Real Estate Investment Co.


Company Description Qatari Diar Real Estate Investment Company (QDREIC), a real estate company established in 2005, is a wholly owned subsidiary of Qatar investment Authority. It is also involved in some of the states largest infrastructure schemes, including Qatars national rail network and the Friendship Bridge, a causeway linking Qatar with Bahrain. Qatari Diar also enters into a joint venture with Vinci, France named as Qatari Diar Vinci Construction to develop schemes. Qatari Diar major activities include Real estate property investment, development, management and brokerage services, ownership and management of hotels and resorts, design and construction management, conventional and Islamic direct investment in various sectors including real estate, investment banking services, initial public offerings and underwriting and offer advertising. Projects
Project Name Description

Key Personnel Board of Directors HE Youssef Hussein Kamal Chairperson HE Khaled Mohammad Abdullah Al Attiyah Vice Chairperson Rashid Al-Naimi Director Saad Al Mohannadi Director Norman Lyle Non Executive Director Management Mohammed Ali Al-Hedfa CEO Ghanem Bin Saad Al-Saad Managing Director Waleed Bangash CFO

Qatari Diar Real Estate Investment Company (QDREIC) - Lusail Development QRDC - Qatar Integrated Rail Project

Lusail Devalopment is a megaproject divided into thirteen district. The project include residential, spaces, parks, beaches and recreational areas. The value of poject USD 45 bn and expected to complete in Q4-15. QDREIC (51%) formed a joint venture with Deutsche Bahn (49%) namely Qatar Railway Development Company to develop the railway system in Qatar. The projects estimated cost is USD 21 bn and is expected to be completed in Q2-20. The bidders for the PMC are Bechtel Corporation, Fluor Corporation, Parsons Brinckerhoff International.

Qatari Diar Vinci Construction


Company Description Qatari Diar Vinci Construction (QDVC) is a joint venture with 51% held by Qatari Diar Real Estate Investment Company (QDRIC) and 49% by Vinci Construction Grands Projects established in 2007 in France. The main objective is contracting and construction work along with any associated services related to large selected design and build projects. The company primary activities include civil contracting for infrastructure, buildings and heavy projects; marine and electromechanical contracting; engineering consultancy and landscaping services. Projects
Project Name Description

Key Personnel Board of Directors Youssef Ahmad Al Hammadi Chairperson Serge Moulene Vice Chairperson Raoul Dessaigne Director Alain Bonnot Director Ghanim Hassan Al-Ibrahim Director Hassan Al Derham Director Management Yanick Garillon CEO Thibaut Peniguet CFO Hamad Al-Bishri Deputy CEO Stephan Van Dyk Human Resources Director Claude Michas Head of Procurement and Logistics

Lusail Light Rail The company won EPC contract for Light Rail Transit Network- Underground System (LRT) construction project in Lusail City which Stations (8 nos.) will cover civil engineering work in eight underground stations. The budgeted value of the project is USD 725 mn and expected to complete in Q3-14. Doha North Sewerage Treatment and Associated Works PS 70 and Pumping Main CP 682/2 Sheraton QDVC won EPC contract in the joint venture with Vinci Construction Grand Projects (40%) and Entrepose (30%). The pumping station will have a capacity of 900,000 (m3/d).The estimated cost of project is USD 500 mn and expected to complete in Q2-12. The contract includes design construction of an underground two level car park have a capacity of 1,986 cars, a 66 kv sub-station for Kahramaa, two 11 kv sub stations and a tunnel. The estimated cost of project is USD 335 mn and expected to complete in Q3-13.

80 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Qatar Engineering and Construction Company


Company Description Qatar Engineering & Construction Company (Qcon) is the leading National EPC & Maintenance Contractor in the Oil & Gas, Petrochemical, Fertilizer and Power industries. Formally known as MECON, the company was established in 1975. The company major activities includes EPC Projects, construction, pre-commissioning, commissioning, start-up services, Medium and Heavy Steel Fabrication, Fabrication offshore structures, including topside production facility etc. Qcon operates through its three divisions: Industrial Projects Maintenance Services Mechanical Fabrication Projects
Project Name Description

Key Personnel Board of Directors HH Sheikh Ahmad Bin Jabor Bin Mohammed Al Thani Chairman Management Mazen Abu Nabaa Managing Director Raque Ahmed DGM Operations Hossam Abdelmajeed DGM Projects Haitham Elsaka Manager, Maintenance & Logistics

Qatargas - Jetty Boil-off The company awarded the Qatar gas, a recovery project Gas Recovery to recover and collect boil off gas at each port berth. This project will recover the equivalent of some 0.6 mn tonnes a year of LNG, which is enough natural gas to power more than 40000 home. The budgeted value of the project is USD 1,000 mn and expected to complete in Q4-13.

Qatar Foundation
Company Description The Qatar Foundation is a privately owned organization that invests in the countrys education, scientic research and community development through joint ventures and partnerships. Foundation established the Qatar Science and Technology Park to enhance scientic research capabilities. The Park is a free zone for technology-based companies involved in aircraft operations, oil and gas, petrochemicals, ICT and water. The Foundation also established, the Qatar National Research Fund, which provides nancial support to researchers in the public, academic or corporate elds. The Qatar Foundation developed the Qatar National Convention Center to provide space for exhibition. Projects
Project Name Description

Key Personnel Board of Directors HH Sheikha Mozah bint Nasser Al-Missned Chairperson Saif Ali Al-Hajari Vice Chairperson HH Sheikh Dr. Hamad Bin Nasser Al-Thani Director HE Abdullah Hussain Al Kubaisi Director Dr. Mohammad FathySaoud Director Hassan Al-Derham Director HE Sheikhabint Abdulla Al- Misnad Director Dr. Jordan J Cohen Director Ahmed Zewail Director

Qatar foundation - Education City

The Qatar Foundation for Education, Science & Community Development will cover an area of 45 hectares. The project also consist a number of sub projects. The estimated cost of the project is USD 6.6 bn and it is estimated to complete in Q2-12. Qatar Foundation is planning to construct an Aerospace City in Al Khor which will cover an area of 40,000 sqm. The project will include expertise from NASA, and will also include a research facility keen to satellite and space sciences. The estimated cost of project is USD 3.3 bn and expected to complete in Q2-17.

Qatar Foundation - Aerospace City

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 81

Qatar Investment and Projects Development Holding Company


Company Description Qatar Investment and Projects Development Holding Company (QIPCO) invest in companies that operate in real estate, construction, oil and gas, trading, nancial services, health care, electrical engineering and electronics manufacturing, and industrial systems solutions. The company formed a joint venture named as Investment house with Qatar National Bank to access nancial sector. QIPCO has also established Joint Venture Companies with renowned International Partners like Siemens, ThyssenKrupp and Emcor. The company has a number of subsidiaries in different segment as follow: Real Estate Sector: Torando Company, Villagio Mall, Al Bustan Real Estate Company, Asas Real Estate Company. Contracting Sector: Midmac Contracting Co., Black Cat Engineering & Construction Co. Trading and Service Sector: Manani Corporation Finance Sector: Investment House QIPCO has strategic shareholding in following companies: Qatar Airways International Bank Of Qatar Mazaya Qatar Qatar Finance House Qatar National Bank
Key Personnel Board of Directors HH Sheikh Abdulla Bin Khalifa Al-Thani Chairperson HH Sheikh Suhaim Abdulla Al-Thani Director Raoul Dessaigne Director HH Sheikh Hamad Bin Abdulla Bin Khalifa Al-Thani CEO HH Sheikh Fahad Bin Abdulla Al-Thani Director Mohammed Ali Mohammed Khamis Al-Kubaisi Director

Q. Mobility
Company Description Q. Mobility is the rst infrastructure solution provider established in 2010 in Qatar. The company is a semi-government organization, focused on development of transportation, airport, rail, metro, road, pedestrian, and beautication solutions for all nations in the Middle East. The infrastructure investments in the Middle East are expected to exceed two trillion dollars in the next ten years. The company major business lines includes Infrastructure solution, Airports, Metro train, Bike system, Urban Planning and City Development, Street Furniture, Street Way nding and Signage and Intelligent Trafc System. Projects
Project Name Description

Key Personnel Management Anas Ismael Al Keilani Managing Director Amit Kumar Singh Deputy CFO Ibrahim Almalki Executive Director of International Projects Tareq Addasi Senior International Business Development Director

Lusail project

Q. Mobility has signed an agreement with Qatari Diar to provide high quality street xture elements, bicycle racks, benches, lights poles, intelligent transportation management systems, guard rails, safety barriers, noise barriers and rail furniture etc. for Lusail projects The company is in the process of signing a corporate agreement with Education City for the design, manufacture, installation, and maintenance the street furniture of the city.

Education City

82 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

Qatar Steel Company


Company Description Qatar Steel Company (QS) was established in 1974 as a joint venture between Government of Qatar and two Japanese companies, Kobe Steel (20%) and Tokyo Boeki (10%). Later on, the company was fully acquired by Industries Qatar in 2003, which is 70% owned by Qatar Petroleum, while the remaining is public. The company is involved in manufacturing and distribution of iron and stainless steel products. Its manufacturing plant is in Mesaieed and sales and marketing ofce is located in Doha. It also operates a UAE based subsidiary - Qatar Steel Company FZE Dubai and has stake in four associates, Qatar Metal Coating Company (50%), United Stainless Steel Company (25%), Gulf Industrial Investment Company (25%) and South Steel Company (20%). The company has production capacity of 800,000 tons annually. Projects
Project Name Description

Key Personnel Board of Directors HE Youssef Hussein Kamal Chairperson HE Dr Mohammed Saleh Al-Sada Vice Chairperson Abdulrahman Ahmad Al-Shaibi Director Nasser Mubarak Sha Al-Sha Director Ali Hasan Al Muraikhi Director Mohammed Hitmi Ahmed Al-Hitmi Director Fahed Hamad Al Mohannadi Director Idris Gamil Director

QASCO - Meltshop Upgrade

The project include construction of Rolling mills, Electric arc furnace, Ladle furnace, De-dusting system etc. which will expand the capacity of 1,100,000 tpa. M.N. Dastur & Company on PMC contract for the project.The estimated value of project is USD 1 bn and expected to complete in Q1-13.

QASCO/Essar - Mesaieed The project will be executed in two phases. The Steel Plant rst is scheduled to result in the commissioning of an HBI plant by the rst half of 2008, the second to yield at rolled steel products at a later stage. The project is currently on hold. The estimated value of USD 1.3 bn.

Rabban Readymix
Company Description Rabban Readymix is a leading ready mixed Concrete company based in Doha. The company was founded by Mr. Khalid Al Rabban. The company product portfolio includes ready mix concrete and ready mix mortars and plasters. The company provide ready mix product in the construction of well-known building such that Gulf mall, Villagio, Landmark, Barwa City Buildings, Doha Airport, Al Fardan Towers etc. Projects
Project Name Description

Key Personnel Board of Directors Khaled bin Mohammed Al Rabban Chairperson Hamad Khaled Al Rabban Director Nasser Bin Khaled Al Rabban Director Mohammed Khalid Al Rabban Director Khalifa Khaled Al Rabban Director Management Clive Cash CEO Fred Greger General Manager

Al Udeid Air Base

The project includes construction of runway measures 15,000 long along with shelters that can accommodate 100 aircraft. The company will provide ready mix concrete in the construction of Al Udeid Air Base. The company currently supplying the ready mix concrete in the construction of 12 new departure terminals at Doha International Airport. The Joint Venture of Rabban Readymix and Medgulf have supplied over 750,000 cubic mt. into the project from the Site based facility established at Ras Laffan.

Doha Airport

Shell GTL Project at Ras Laffan

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 83

Saudi Binladin Group


Company Description Saudi Binladin is a contractor company established in 1931 by Mohammed Binladin. The company major activities includes Civil and electromechanical contractors for buildings, infrastructure and heavy industries projects, production of cement, steel, marble, granite, ready mix and precast concrete etc., distribution and leasing of heavy equipment, real estate investment, domestic and international transportation of goods. SBG services also include turnkey consultation, solution, and implementation in the eld of network and software and hardware systems. The company has played a key role in developing Saudi Arabia infrastructure and operates one of the largest eet in of heavy machinery in the world. The company has constructed more than 5,000 km road throughout the kingdom. Bakr Mohammed Awad Binladin hold 23.58% stock and Omar Sheikh Mohammed bin Awad bin Laden hold 10.23% stake in the company. Projects
Project Name Description

Key Personnel Board of Directors Bakr Bin Mohammed Binladin Chairperson Yehia Mohammed Awad Binladin Vice Chairman Mutaz Al Sawwaf Director Henry Serkissian Director Abu Bakr Salim Al Hamid Director Ahmed Mohammed Awad Binladin Director

SAGIA - Jazan Economic City

JEC will cover an area of 40,000 sqm and will be divided into four distinct area named as Heavy Industries, Secondary industries, Human capital (Education area, mosque etc.) and lifestyle (Hotel, Marina etc.). The budgeted value of project is USD 27 bn. The project will cover an area of 3,300,000 sqm which includes retail nancial, residential and cultural facilities. The budgeted value of project is USD 7.8 bn.

PPA - King Abdullah Financial District

Six Construct Qatar Ltd.


Company Description Six Construct Qatar Ltd. operates as a subsidiary of BESIX Group. Six Construct Qatar Ltd. engages in construction of convention center and tower. The company is based in Doha, Qatar. Projects
Project Name Description

Key Personnel Management Arshad Ali Faizi Head of Personnel Pierre Sironval Project Director Johan Vindevogel Faade and Roof Manager - Head of Envelope Tanghy Vandestraete Project Manager

Doha Convention Centre The company has been awarded a contract to build phase and Tower in Qatar IIB of the Doha Convention Centre and Tower in Qatar in a joint venture with Midmac Contracting Co. The share of Six Construct for this contract is approximately USD 338 mn. The project is expected to complete in end 2012. New Doha International Airport (NDIA) Passenger Terminal Complex The company has been awarded a contract to build Phase III of the New Doha International Airport (NDIA) Passenger Terminal Complex in joint venture with the Midmac Contracting Co. Six constructs share for this contract is approximately USD 375 mn. The project is expected to complete in Q4-12.

84 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

TAV Construction
Company Description TAV construction is a joint venture of Tepe Construction and Akfen Construction. The company was founded in 1997 to execute the Build-Operate-Transfer Project of the Istanbul Ataturk International Airport and the Multi-Storey Car Park. The company is specialized in the construction of airports, passenger terminals, highly competent in installation of all high-tech systems within these structures. The company has seven branches and two subsidiaries named as TAV Muscat LLC and TAV Qatar LLC outside of Turkey. The company has a project portfolio of approximately 10.5 bn. Projects
Project Name Description

Key Personnel Board of Directors Ali Haydar Kurtdarcan Chairperson Hamdi Akin Vice Chairman Mustafa Sani Sener Director

New Doha International Airport Terminal Building And Concourses (A-B-C)

TAV Construction entered into a joint venture with the Taisei - Japan-based construction company to build three concourses in the New Doha International Airport terminal and the expansion package. The project includes total built-up area of 5.4 mn sqf and is expected to handle 24 mn passengers per year.

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 85

13. Abbreviations
AED AFC ASHGHAL AZF Bn BOT Bpd CAGR CEO cmd COMCAP CP DFC DFI EPC EUR FDI GBP GCC GDP GLA GTL IATA IMF IWPP JPY JV KAHRAMAA km KRW LNG LRT MENA MEP MIA MIGD mn mmgpd MOU MSM mt mtpa MW m3 m3/d United Arab Emirates Dirham Asian Football Confederation Public Works Authority Aspire Zone Foundation Billion Build, Operate and Transfer Barrels Per Day Compound Annual Growth Rate Chief Executive Ofcer Cubic Meters Per Day Commercialbank Capital Construction Package Doha Festival City Doha Film Institute Engineering, Procurement and Construction European Union Currency Foreign Direct Investment Pound Sterling Gulf Cooperation Council Gross Domestic Product Gross Leasable Area Gas to Liquid International Air Transport Association International Monetary Fund Independent Water and Power Project Japanese Yen Joint Venture Qatar General Electricity & Water Corporation Kilometer South Korean Won Liqueed Natural Gas Light Rail Transit Middle East and North Africa Mechanical, Electrical & Plumbing Museum of Islamic Art Million Imperial Gallons Per Day Million Million gallons per day Memorandum of Understanding Muscat Securities Market Million Tons Million Tons Per Annum Mega Watt Cubic Meters Cubic Meters Per Day NASA NDIA NDS NGL NHS NLA OMR PMC PPP PV PWA PWPA QAR QDREIC QEWC QF QIA QMA QNCC QP Qrail QRDC QTA Qtel SEC STW sqf sqm TEU tn tpa TSW UAE USD WTTC National Aeronautics and Space Administration New Doha International Airport National Development Strategy Natural Gas Liquid National Health Strategy Net Leasable Area Omani Riyal Project Management Company Public Private Partnership Photovoltaic Panels Public Works Authority Power and Water Purchase Agreements Qatari Riyal Qatari Diar Real Estate Investment Company Qatar Electricity and Water Corporation Science and Community Development Qatar Investment Authority Qatar Museum Authority Qatar National Cement Company Qatar Petroleum Qatar Railways Company Qatar Railways Development Company Qatar Tourism Authority Qatar Telecom Supreme Education Council Sewerage Treatment Works Square Feet Square Meter 20-foot Equivalent Units Tons Tons Per Annum Treated Sewer Efuent United Arab Emirates United States Dollar World Travel and Tourism Council

86 - COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT

14. Disclaimer
Commercial Bank (referred to hereinafter as we), Commercial Registration No. 49621, a single-person company regulated by the laws of Qatar, has issued this Document. This Document does not constitute an offer or invitation to subscribe for or sell or purchase any securities, and this Document shall not form the basis of any contract or commitment whatsoever. We may, from time to time, to the extent permitted by law, participate or invest in any other transactions with the issuers of the securities, perform services for or solicit business there from, and/or make transactions in the securities or options therewith. We may, to the extent permitted by the relevant applicable laws or regulations, make transactions in the securities before this Document is published to recipients on our website. Information and opinions contained herein have been compiled or arrived by us from sources believed to be reliable, but we have not independently veried the contents of this Document. Accordingly, no representation or warranty, express or implied, is made by us as to fairness, accuracy, completeness or correctness or correctness of the information and opinions contained herein. We accept no liability for any losses or damages arising from reliance on or use of this Documenting making any securities transactions. This Document shall not be relied upon or used in substitution for the exercise of independent judgment. We shall have no liability whatsoever in respect of any inaccuracy in or omission from this Document or any other relevant document prepared by us for, or sent by us to, any person, and any such person shall be solely responsible for conducting their own investigation and analysis of the information contained or referred to in this Document and of evaluating the merits and risks involved in the securities forming the subject matter of this Document or any other relevant document. It is understood that information, opinions and estimates set out in this Document or any other relevant document, constitute our own judgment and may be subject to change at any time without prior notice. Past performance is not indicative of future results. This Document is being furnished to you solely for your information and may not be sent to any other person. This Document or any other relevant document may not be distributed in any jurisdiction outside Qatar where its distribution may be restricted by law in such jurisdiction. This Disclaimer is unconditional and it does not require any consent from any recipient and all limitations mentioned hereinabove shall automatically apply to any possible recipient who receives this Document or any other relevant document. Data and pictures have been taken from the following source: MEED projects, website and Magazine ConstructionWeek Magazine Oxford Business Group Qatar 2011 Websites of companies profiled. Reuters/Bloomberg/Zawya
( ) . . . / . . . . . . . . . . .

COMMERCIALBANK CAPITAL - CONSTRUCTION SECTOR REPORT - 87

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88 - COMMeRciALbANK cAPitAL - CONstRUctiON SectOR RePORt

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