Qatar yesterday announced it had awarded a $2.5 billion contract to US construction giant Bechtel to build a new airport. This takes its intention to create the region's second aviation hub in Doha a giant step forward. Bechtel will design the new airport, manage the project and take charge of the construction of the new facilities, which will cover 2,200 hectares. The new airport, likely to be completed by 2008, will be situated some four kilometers East of the existing airport. It will feature two runways, built mostly on reclaimed land, and will have an initial annual passenger handling capacity of 12 million.

The contract is the first part of the three-phase project to be completed in 2015, which will transform Doha International Airport into a regional gateway for business and leisure travelers, increasing its passenger handling capacity to 60 million from the current 4.6 million per annum. The first phase, due to begin this year, will cost more than $2.5 billion and will include reclaiming nearly half of the site from the Gulf with 50 million cubic meters of fill, a 140,000 square meter three-story terminal with 24 contact gates and three major road interchanges to access the new airport.

Detailed design work will commence this year and continue throughout next year as the site is reclaimed and construction of the new major facilities begins next year. As traffic and demand grows, the mid-term phase will see the addition of a further 16 contact gates and an extension of the terminal building to 219,000 square meters and a suspended monorail or "people mover' to transport passengers through the terminal.

The final phase of development will include the addition of another 40 contact gates, bringing the final total to 80, together with a further extension to the terminal building to 416,000 square meters, capable of handling 50 million passengers a year.

It will be the world's first airport to be designed and built from the ground up, specifically for the Airbus A380-800 - the world's largest passenger aircraft. On completion of phase one in late 2008, the airport will be able to accommodate two A380-800s at any one time. By the time the airport is fully developed, it will be capable of accommodating six A380-800s.

Abdulaziz Mohammed Al Nuaimi, chairman of the board and managing director of the Civil Aviation Authority, declared: "We feel Bechtel's vast expertise will make our new airport set the benchmark for all future airports. It will be an international signature for the vision of Qatar."

Dr James Van Hoften, vice-president of Bechtel, said: "We are delighted to have been chosen to work with the Government of Qatar in this project."

The Gulf states of Qatar and the United Arab Emirates (UAE), key US allies, said on Tuesday after talks with Washington's Iraq debt envoy that they would waive most of the more than $7 billion Iraq owes them.

The crown prince of the UAE capital Abu Dhabi, Sheikh Khalifa bin Zayed al Nahayan, said his country was prepared to start talks to write off most of Iraq's debts which a UAE source said were more than $3.8 billion.

In Qatar, a Foreign Ministry official said his country would waive most of Iraq's debts and consider writing off the rest. Another Qatari official said Iraq owes Doha about $4 billion that has accrued since the 1980s.