NEOM, the $500 billion megaproject for a zero-carbon, renewable energy-powered smart city in Saudi Arabia’s northwest, has been in the news again in 2022 with the launch of its new subsidiary and tangible progress on its initial infrastructure and master planning. Development has accelerated on NEOM’s core projects: The Line, a residential and mixed-urban hub; Oxagon, an industrial hub; and Trojena, a tourism and entertainment hub.
Subsidiaries
NEOM’s latest subsidiary is ENOWA, which represents NEOM as the principal shareholder in a $5 billion joint venture with U.S.-based Air Products and Chemicals (a USSBC member) and Saudi-based ACWA Power to develop the world’s largest green hydrogen production plant. The plant, powered by renewable energy, will save 3 million tons of carbon dioxide emissions per year while producing 650 tons per day of hydrogen and 1.2 million tons per year of ammonia for the global market. The plant will be located in NEOM’s industrial cluster and is scheduled to begin production in 2025. ENOWA will also play a key role in developing zero liquid discharge desalination plants, powered entirely by renewable energy, to supply low-cost drinking water to all residents and businesses in NEOM. Specifically, ENOWA will develop brine reuse systems and implement smart sensors for NEOM’s desalination plants. ENOWA has already begun work on the electrical infrastructure for NEOM, involving substations and transmission lines spanning hundreds of miles.
In February 2022, NEOM launched its first subsidiary, NEOM Tech & Digital Company. The subsidiary is developing a “3D cognitive digital twin metaverse platform” called XVRS that will give users a “gamified experience with distinctive exploration and entertainment features, an instant language translation tool, a social platform that fosters interaction, and a full-fledged digital marketplace,” according to company leadership. NEOM Tech & Digital Company will invest nearly $1 billion in next generation AI-related products, cognitive smart city technologies, and autonomous solutions. NEOM plans to spin off many more subsidiaries in the future as development on the mega-city continues.
Recent Developments
Although first announced in 2017, the pace of NEOM’s development accelerated greatly in 2021 starting with initial grading work on The Line, civil engineering and infrastructure for Oxagon’s water innovation hub, and major contract awards to Bechtel as the executive project manager and AECOM as the lead designer. NEOM already has completed Neom Bay Airport, a commercial airport with an 8,000 ft runway, and its first permanent villages for on-site staff. As of February 2022, NEOM hosts more than 11,000 workers from 44 contractors, 8,000 pieces of heavy equipment, and has accounted for over 34 million job hours to date. Permanent facility construction has also begun at NEOM Logistics Park, which will support a working population of 30,000, a manufacturing and logistics hub for the megaproject’s construction operations, asphalt production plants, and waste treatment facilities.
In October 2021, Saudi Arabia began initial earthwork and basic infrastructure development for The Line, its transportation backbone “The Spine,” and its industrial hub Oxagon. The Line will be a series of 105-mile car-free, carbon neutral nodes connected by high-speed rail. NEOM expects the $100-$200 billion project to be home to 1 million people, create 380,000 jobs, and contribute $48 billion to GDP by its predicted completion date of 2030. The Line is expected to have its first residents by 2024.
Oxagon, as featured in our previous article, will be an eight-sided floating city straddling the gigaproject’s Red Sea coastline. The geometrically-named city will host the world’s largest floating structure and serve as a logistics hub for both NEOM and the greater Saudi economy. The city’s next-generation automated and integrated port will have a total capacity of 3.5 million standard shipping containers and will connect with the country’s arteries of roads, airports, and high speed railways and a driverless last-mile delivery system for the end-customer. The new city will be key to Saudi Arabia’s greater efforts to increase regional and international trade, taking advantage of its prime location near the Suez Canal, which oversees 13 percent of all global trade.
In March 2022, NEOM announced Trojena, an outdoor tourist destination in the mountains of the Tabuk province. The ambitious development will include a year-round outdoor ski resort and adventure sports park, a mountain-top public observatory for stargazing and taking in the area’s scenic views, a futuristic village built vertically into the valley’s walls, a wildlife reserve, and a freshwater lake ringed by lodgings for tourists. The Vault, Trojena’s vertical “smart village,” will include apartments, vacation homes, hotels, conference facilities, wellness resorts, and a variety of retail and dining amenities. Like the rest of NEOM, Trojena’s development will embrace the concepts of sustainability and ecotourism. Trojena’s first attractions are scheduled to open in 2026. NEOM expects Trojena to attract 700,000 annual visitors and 7,000 permanent residents while creating 10,000 full-time jobs and adding $800 million to national GDP by 2030. Located 30 miles from the Gulf of Aqaba, Trojena will encompass 23 square miles with elevations reaching nearly 8,500 feet.
According to NEOM CEO Nadhmi Al-Nasr, the government’s vision is “to make this the most competitive free zone in the world.” The Saudi government plans to distinguish NEOM as a semi-independent “free zone” with its own distinct set of laws, regulations, and semi-governmental authority to improve the megadevelopment’s commercial competitiveness and ability to attract the world’s “most diverse and most talented workforce,” according to NEOM Tech & Digital Company CEO Joseph Bradley. NEOM will operate under its own founding law, expected to be fully drafted and approved by 2023 and designed to attract “the world’s best and brightest” from the tourism, tech, and manufacturing markets.
NEOM, a member of the U.S.-Saudi Business Council (USSBC), is interested in meeting companies involved in information technology, construction, energy, water, manufacturing, education, biotech, food, tourism, and many others. The USSBC has organized private individual and group visits to NEOM since the project’s launch. If you are a U.S. company in one of those industries, contact the USSBC today and we can help you contact NEOM’s leadership to discuss how you can get involved.
