Gulf states to extend railway project to Yemen -UAE

MUSCAT, Oct 17 (Reuters) - Wealthy Gulf states have agreed in principal to extend their multi-billion dollar railway project to Yemen, their poorer neighbour on the Arabian peninsula, a United Arab Emirates official said on Saturday.

The six countries in the Gulf Cooperation Council (GCC) -- a loose economic bloc that comprises Saudi Arabia, the UAE, Kuwait, Qatar, Oman and Bahrain -- are spending more than $100 billion on various rail projects to ease congestion in the face of poor public transport networks and a growing population.

The Gulf Arab rail network alone will cost $20-$25 billion as the six oil producers seek to create a similar model to Europe's high speed rail system.

The 1,940-km railway would connect the six Gulf states, each of which would contribute a share of the start-up capital. Yemen had asked for the railway be extended over its border with Oman.

'The GCC has accepted in principle to extend the railway link to Yemen from Oman,' said the official, who was attending a meeting of Gulf policymakers in Oman.

Yemen, which is not in the GCC, is facing an insurgency in the north where Zaidi Shi'ite Muslims took up arms against the government in 2004, as well as frequent clashes with separatists in the south.

Gulf officials also agreed on Saturday to appoint a single authority for the rail project and approved its design.

Dubai opened the initial phase of its $7.62 billion metro project in September. Other cities including Riyadh, Mecca and Kuwait are also planning rail systems.

(Reporting by Saleh al-Shaibany; Editing by David Stamp) Keywords: YEMEN RAILWAY ([e-mail], [phone], Reuters Messaging: [e-mail]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.