NEOM, the futuristic megaproject being developed by Saudi Arabia in the country’s northwest, has terminated Webuild’s contract for the Connector High-Speed Line, a high-speed rail line that was to link Oxagon to the linear city The Line. The decision comes at a time when international media are reporting that Saudi Arabia is postponing and scaling back some of NEOM’s most spectacular components, including the linear city The Line.
Webuild announced that NEOM has exercised its right to terminate the contract for the Connector High-Speed Line, a high-speed rail project planned for the Sharma area in Tabuk Province, along the northern coast of the Red Sea. The termination of the contract will take effect on May 27, 2026.
At the time of termination, work will have reached approximately 20% completion, and the remaining work attributable to Webuild is estimated at approximately EUR 1 billion. The Italian company notes that the project was already suspended and that no revenue from this contract was expected for the current year.
According to Webuild, all costs incurred up to the date of contract termination, as well as costs related to the early termination—including site withdrawal and demobilization activities—will be reimbursed by the client. The Italian contractor notes that this termination concludes all its activities for NEOM. The group’s project portfolio, after removing the remaining project-related activities, remains over EUR 50 billion.
A 57-km line between Oxagon and The Line
The High-Speed Line Connector contract was intended to be a key component of NEOM’s rail infrastructure. The project involved the construction of a 57 km line, which was to connect Oxagon, NEOM’s planned industrial hub, with The Line, the linear city promoted as one of the central components of the Saudi megaproject.
The contract included the design and construction of civil works for two high-speed rail lines and two freight lines, as well as viaducts, road bridges, and road and rail overpasses. When the contract was awarded in 2023, its value was approximately EUR 1.4 billion, and Webuild led the joint venture with local partner Shibh Al Jazira Contracting Company (SAJCO).
For NEOM, such a rail link was relevant because the project had been presented as an ultra-connected urban and industrial region with rapid and sustainable transportation infrastructure.
The Line had been promoted as a 170 km linear city, without traditional roads or cars, capable, in the initial plans, of accommodating up to 9 million residents.
The Line, postponed beyond 2030
The termination of the rail contract comes amid recent reports regarding NEOM’s reassessment of priorities. Semafor reported that additional work on The Line has been postponed until at least after 2030, while the sovereign wealth fund of Saudi Arabia is shifting its focus to infrastructure deemed more immediately productive, such as ports and data centers.
According to the same report, NEOM has also reportedly postponed the development of tourist destinations along the Red Sea coast, and new investments in Trojena, the mountain resort slated to host the 2029 Asian Winter Games, have reportedly been pushed back to after 2030 as well. In contrast, Oxagon, the planned industrial city on the Red Sea, is set to receive additional investments of approximately USD 3 billion, with a focus on the port, utilities, and connectivity for data centers.
Furthermore, the population target for NEOM by 2030 would have been reduced to no more than 100,000 residents, after earlier plans had set much more ambitious goals. This information does not equate to the cancellation of the entire NEOM project, but it indicates a shift in priority: from futuristic and spectacular components toward infrastructure with more immediate economic utility.
A Signal for NEOM’s Futuristic Infrastructure
In this context, the termination of the Webuild contract has broader significance than simply a contractor’s exit from a project. The High-Speed Line was designed as a link between two central parts of NEOM: Oxagon, the industrial component, and The Line, the futuristic urban component.
The fact that the railway line has been halted while The Line is postponed until after 2030 suggests that Saudi Arabia is calibrating its investments based on projects deemed more urgent or easier to monetize. Oxagon appears to remain a priority, but the focus is shifting toward the port, utilities, logistics, and digital infrastructure, rather than the accelerated construction of the linear city.
For Webuild, the immediate financial impact appears limited by contractual provisions regarding cost reimbursement and the fact that the project was already on hold. Symbolically, however, the company’s exit from NEOM marks a new phase in the evolution of one of the world’s most closely watched and controversial infrastructure megaprojects.
For the rail sector, the case also highlights the limitations of transportation projects integrated into large-scale, futuristic urban developments. In the absence of a clear timeline for the components they are intended to serve, even a high-speed line may end up being reevaluated, suspended, or removed from immediate plans.
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