His Highness Sheikh Theyab bin Mohamed bin Zayed Al Nahyan, Deputy Chairman of the Presidential Court for Development and Fallen Heroes’ Affairs, Chairman of Etihad Rail, attended the announcement ceremony for the successful bank financing of the Hafeet Rail network project connecting the UAE with the Port of Sohar, Oman, with a total value of USD 1.5 billion in project finance debt, secured by Emirati and Omani banks in addition to regional and international banks.
The announcement was made during the inaugural Global Rail Transport Infrastructure Exhibition & Conference - Global Rail 2024, held in Abu Dhabi under the patronage of His Highness Sheikh Mansour bin Zayed Al Nahyan, UAE Vice President, Deputy Prime Minister and Chairman of the Presidential Court, with the support of His Highness Sheikh Theyab bin Mohamed bin Zayed Al Nahyan, Deputy Chairman of the Presidential Court for Development and Fallen Heroes’ Affairs, Chairman of Etihad Rail.
The announcement ceremony was also attended by Sheikh Nasser bin Sulaiman Al Harthy, Deputy Chairman for Operations at the Oman Investment Authority and Chairman of the Board of Directors of Asyad Group, along with members of the Board of Directors of Hafeet Rail, the developer and operator of the Omani Emirati railway network, and a number of officials from the financing entities.
The USD 2.5 billion joint project, which is being implemented and operated by “Hafeet Rail”, demonstrates strong confidence from a diverse consortium of local, regional, and international lenders, underscoring the project's strategic importance to both nations.
The Omani Emirati railway network project is the first link in a unified transport and logistics chain that will span the region, delivering mutually beneficial socioeconomic and competitive advantages. The joint network is a testament to the power of partnership, uniting Etihad Rail, Oman Rail, and Mubadala in a shared vision for a connected and prosperous future. Etihad Rail and ASYAD Group hold the largest shareholder stakes in the joint venture, Hafeet Rail.
Eng. Abdulrahman Al Hatmi, CEO of Asyad Group said: “The strong interest shown by leading banks in both countries to finance the project reflects the strong confidence in this strategic investment. The success of Hafeet Rail in securing this bank financing not only boosts the transport and logistics sector but also stimulates economic growth and enhances commercial activity between the two countries. The joint Emirati-Omani rail network project will undoubtedly enhance the competitiveness of both countries and the region as a vital commercial and investment hub, connecting them to global markets through the ports and state-of-the-art airports.”
Commenting on the announcement, His Excellency Shadi Malak, CEO of Etihad Rail said: "The success of Hafeet Rail's bank financing is a resounding vote of confidence in the immense potential of this transformative project. By connecting the UAE National Railway Network with Sohar Port, we are creating a vital artery for trade, unlocking new efficiencies, and solidifying the region's position as a global logistics hub. This aligns with Etihad Rail's mission, guided by the support and leadership of His Highness Sheikh Theyab bin Mohamed bin Zayed Al Nahyan, Deputy Chairman of the Presidential Court for Development and Fallen Heroes’ Affairs, Chairman of Etihad Rail, to drive a brighter future for the transport sector in the UAE and the wider region. The bond between the UAE and Oman has long been forged in a shared history, and today, with Hafeet Rail, we are weaving a new strand of progress, prosperity, and boundless opportunity for our people."
Standard Chartered, in its capacity as Lead Financial Advisor, played a pivotal role in procuring the required debt funding for the project’s development since early 2023. First Abu Dhabi Bank acted as the Co-Financial Advisor. The project finance debt was sourced from a combination of UAE, Omani, regional, and international banks across conventional and Islamic tranches in both AED and OMR currencies.
The consortium of banks involved in this financing agreement from the UAE - Abu Dhabi Commercial Bank, Arab Bank, Commercial Bank of Dubai, First Abu Dhabi Bank, National Bank of Kuwait, Standard Chartered Bank, Abu Dhabi Islamic Bank, and Bank Ajman. The agreement also included nine banks from Sultanate of Oman, including Ahli Bank, Bank Dhofar, Bank Muscat, National Bank of Oman, Oman Arab Bank, Ahli Islamic Bank, Bank Muscat (Meethaq Islamic Banking), Bank Nizwa, and Alizz Islamic Bank.
The 238km long railway network – to include 60 bridges, some towering up to 34 metres in height and tunnels stretching 2.5 km in length – will link five major ports and various industrial and free zones across the two nations. A single freight train journey on the network is expected to transport more than 15,000 tonnes of cargo, or approximately 270 standard containers. Sectors set to benefit from this new capacity range from mining to iron and steel, agriculture and food, retail, e-commerce, and petrochemicals.
Once operational, the railway will cut the travel time between Abu Dhabi and Sohar to just 100 minutes with freight trains reaching speeds of 120km/hour. Passengers will be able to ride on the network, with one train being able to accommodate up to 400 travellers at a speed of 200km/hour.
The Hafeet Rail project aligns with both the UAE's Centennial Plan 2071 and Oman Vision 2040, fostering economic growth, social cohesion, and sustainable development in both nations. The joint network pays homage to Jebel Hafeet, holding historical importance and strategic significance to both countries and aims to strengthen trade ties, boost tourism, and enhance connectivity between the two countries and the wider region.
Hafeet Rail has successfully reduced the required bank financing for the Emirati-Omani rail network from the initially announced USD 3 billion to USD 2.5 billion. This highlights the company's strategic approach and dedication to optimising resources while advancing the development of this critical project. Even with the reduced budget, Hafeet Rail remains unwavering in its commitment to delivering exceptional quality and efficiency, adhering to the highest global standards.
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