Saudi deal: Foreign firms still await word on Saudi phone
deal
10:05 a.m. Jun 29, 1999 Eastern
MANAMA, June 29 (Reuters) - International firms
competing
for a multi-billion dollar Saudi telecommunications
project said on
Tuesday they had not been told when it may be
awarded and one
source said a decision was not expected before
mid-2000.
Lucent, Alcatel, Siemens, Ericsson and Northern
Telecom have
been competing for the $5-6 billion project, known
as TEP-8, to
add some two million telephone lines to the
kingdom's overloaded
network.
''It (the project) is not expected to be awarded
very soon.
Probably not before the first half of next year,''
a Riyadh-based
industry source closely following the project told
Reuters.
''That is because they (the Saudi
Telecommunications Company)
are very busy with what they are doing now which
will be
completed in the middle of 2000, and that is the
time when they
will be able to organise new deals,'' the source
said.
Officials at the Saudi Telecommunications Company
(STC), set
up in 1998 with an initial capital of 10 billion
riyals ($2.6 billion) as
part of the desert kingdom's privatisation drive,
could not be
immediately reached for comment.
The STC is aiming to almost treble Saudi's 2.4
million telephone
lines.
It had initially asked international firms to
submit their offer for
the project, known as TEP-8, by November 30 of last
year. But
in January this year it extended the deadline to
February, 1999.
Demand for telephone lines for the 18 million
population in Saudi
Arabia, the world's biggest oil producer and
exporter, is growing
rapidly. And the introduction of the Internet
earlier this year has
added more pressure on the network.
One industry source suggested that the STC was
likely to break
up the project and distribute it among the five
companies. ''Each
company will do part of the job,'' he said.
He added that the STC would award the project to
companies
rather than giving it to contractors.
Industry sources dismissed the idea that financial
problems were
causing the delay in executing the project.
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