Middle East

How a royal visit to a Frisco shipyard cemented US-Saudi relations

Author: Abdulaziz AlaquilThu, 2018-03-29 03:00ID: 1522275633081672100

JEDDAH: It was 1944, World War II was coming to an end, and Stephen Bechtel Sr. was welcoming a young Saudi prince to his shipyard along the shores of San Francisco Bay.
His name was Prince Faisal bin Abdul Aziz and he was the future heir to the Kingdoms throne. The meeting led to a 75-year business relationship based on friendship, loyalty and trust between Saudi Arabia and the US.
Onboard Prince Faisal surveyed construction of ships and marine tankers being built during the war. Notes were taken, and three years later in 1947, King Abdul Aziz invited the heads of Bechtel Corporation to Riyadh to put ink to paper on a host of lucrative construction projects.
Following a successful refinery expansion in Ras Tanura, Bechtel began work on a coastal railroad, a deepwater pier along Jeddahs port, and a power plant in the capital. Bechtel built all three without incident, the first of many successful projects that would transform Saudi Arabia in the decades that were to follow.
“I cannot help but foresee tremendous possibilities pointing toward potentially the biggest development of natural resources ever undertaken,” Bechtel said in 1947.
At that time, his company had been working in the Kingdom for three years.
Saudi Arabia was only a decade into its discovery of oil, and daily production was approaching 250,000 barrels — and climbing. The Kingdom had found the natural resource that would lead it to becoming an economic superpower, and with this newfound wealth, modernization was in order.
The Bechtel Corporation offered a large-scale, efficient, project-management construction company to play a role in this rapid change.
Demand for oil rose in the aftermath of World War II, and Saudi Arabia needed a way to transport that oil to European markets. The Saudi royal family, happy with the construction work of their new American business partners, presented them with the blueprint for the Trans-Arabian pipeline. At the time, it was the largest oil pipeline in the world. Bechtel completed it in 1950 — an impressive 750-mile pipeline in only three years.
Even more remarkable, this project included a standstill period in 1948 during the first Arab-Israeli War. The pipeline began in Saudi Arabia, crossed through Jordan and Syria, and ended in the port of Sidon, south of Beirut, Lebanon. Maximum oil capacity surpassed 500,000 barrels per day — an unprecedented amount at the time. The project required the importation of 265,000 tons of pipe and the construction of 1,200 miles of new roads.
Perhaps the most significant statistic was the 1,600 Americans who worked alongside the 1,200 Saudis. A mutual cooperation of understanding, vision and trust with a common goal.
After multiple visits to see King Abdul Aziz, and on understanding his grander vision for developing Saudi Arabia, Bechtel Corporation was commissioned to build airports, hospitals, hotels, piers, power plants, railways, radio towers and oil facilities around the Kingdom.
Bechtels reputation for quality construction work in Saudi Arabia began to spread throughout the Middle East and Africa. The company began building oil refineries in the UAE and Yemen, constructing pipelines between Iraq and Syria, as well as installing power plants in Egypt. Each completed project would earn subsequent contracts in the region.
Stephen Bechtels relationship with Prince Faisal, which started in 1944, would come full circle in 1973 after he became king. He invited Bechtel to discuss diversifying the Saudi economy away from solely petroleum-based revenue.
Bechtel advised King Faisal on the potential for using gas from the Kingdoms oil fields to generate electricity. As a result, new industrial cities at Yanbu on the Red Sea, and Jubail on the Gulf coast, brought electricity to residents for the first time.
Bechtel also built King Khalid and King Fahd international airports in Riyadh and Dammam respectively.
Bechtels most lucrative year for signing contracts with Saudi Arabia was 1976 as they revealed plans for their grandest project to date. The Jubail Industrial City project would be the single largest commissioned project-management contract ever attempted by a construction company.
Bechtel spent more than 20 years constructing the industrial and manufacturing site along Saudi Arabias Gulf coast, at a cost of more than $40 billion. Saudi Arabias petrochemical industry had finally found a home.
Some 370 million cubic meters of sand was excavated as Bechtel transformed barren dunes into Jubail Industrial City. The city is now home to the worlds largest producers of petrochemicals.
Additional factories, an airport, residential homes, hospitals and clinics, mosques, a swimming marina and a five-million gallon desalination plant were subsequently built to support those working there.
Bechtel worked with their Saudi counterparts through thick and thin. During the First Gulf War, Bechtel provided unwavering support by managing the largest recovery of spilled oil in history, and in the process, protected Saudi drinking water facilities.
In the late 70s, Bechtel was accused of being complicit in the Arab boycott of Israel. Bechtel denied the charges and continued project management work within the Arabian Gulf.
Some 75 years since it first started working with the Kingdom, Bechtel is now involved in the mining and metals sector in Saudi Arabia, as well as building the Kingdoms first metro system in Riyadh, a contract worth $10 billion.
Stephen Bechtel Jr. first visited Saudi Arabia with his father in 1948. He has since returned on many occasions through the years, acknowledging that: “The single most impressive change is not physical, but rather the improvement in the style of living of the average person in Saudi Arabia, the education, the health care. I attribute this to the philosophy and leadership of the royal family, and Im proud that we could play a supporting role.”
His son, Riley Bechtel added: “From our very first job in the Kingdom, we learned the importance of honoring their culture and beliefs and conducting ourselves in a way that made us welcome in their community. Weve never stopped working to be good citizens in Saudi Arabia.”
Currently, Bechtel is the largest construction company in the US and the eighth largest privately owned American company with a 2017 revenue of $33bn.
Much of Bechtels success though, was initially achieved through establishing a friendship and trust with the Saudi royal family. A bond that was first formed through a princes visit to a San Francisco shipyard in 1944.

Foreign laborers working at a Riyadh metro station construction site on a suspended bridge in the Saudi capital. (AFP/File photo)

Main category: Saudi ArabiaTags: Saudi ArabiaSaudi Crown Prince Royal TourBechtelSan Francisco BayUnited StatesRas Tanurarelated_nodes: Bechtel names Saudi country managerBechtel wins contract to run Saudi project management officeBechtel launches innovative training program in Gulf


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