No decision yet on expanding Dubai's Salik toll gates after IPO announcement

Any new gate would be announced three to six months in advance

Vehicles pass under a toll gate on Sheikh Zayed Road in Dubai. AP

Motorists are required to have a tag on the windscreen of their car and an online account to use the high-speed motorway. Victor Besa / The National

Drivers are charged Dh4 ($1.09) for each gate that they pass through. There are eight gates at present, but Salik's IPO prospectus says that more could be built. The National

Signs warn drivers that they need a tag on their vehicle to use this road. Jaime Puebla / The National

Ibrahim Al Haddad is the chief executive of Salik. Photo: Salik

Salik has no immediate plans to expand the number of gates in Dubai, its chairman has said.

The company — which is exclusively authorised to operate, manage and develop the traffic toll system in Dubai — runs eight toll gates in the emirate and will be in control of any new gates through a 49-year concession agreement.

On Tuesday, the Dubai government announced plans to sell a 20 per cent stake in Salik through an initial public offering as it looks to boost the size of its capital markets.

There had been speculation on social media in recent days over potential plans to add further gates along key arteries such as the E311 after people noticed the IPO being advertised on road signs.

According to new agency Wam, Salik chairman Mattar Al Tayer said that any decision to expand the road toll system or add further gates will depend on the outcomes of the transport strategy being constantly revised by Dubai's Roads and Transport Authority.

Existing toll gates in Dubai can be removed or modified subject to a decree by the chairman of the Dubai Executive Council.

New toll gates can also be added subject to the council’s approval, once the Roads and Transport Authority conducts a “comprehensive traffic study in co-ordination with Salik”, Ibrahim Al Haddad, Salik's chief executive, told The National in an interview on Tuesday.

“Today we have an opportunity to add a gate because of traffic needs and we have provided alternatives … the plan from an engineering standpoint is ready,” Mr Al Haddad said.

“The timing to add a new gate will be subject to final approval.”

Long lead-in time

In its IPO prospectus, Salik says there is normally a long lead-in time before any new gate is opened.

“A new gate typically takes approximately nine to 10 months from conception to become operational, and new gates are typically announced three to six months prior to operation,” it said.

The prospectus said there are plans to “strategically expand the network of toll gates to cover high-traffic routes while optimising the traffic flow”.

“With eight gates built in a span of 11 years, the directors believe that the Salik Tolling Business has demonstrated its ability to meet the government’s traffic management goals whilst offering Dubai motorists a seamless mobility experience,” it said.

“Additionally, the creation of five interconnected urban centres in Dubai (as per the 2040 Urban Master Plan) to meet the needs of Dubai’s fast-growing population will create traffic on new roads, and historically, new gates were added in line with population growth.”

Salik said it will provide the RTA with up-to-date insights on traffic flow within Dubai to help the transport authority with any decisions regarding “new gate additions designed to optimise traffic flow within Dubai’s main traffic arteries”.

The emirate's population is forecast to grow more than 70 per cent growth between 2020 and 2040.

A total of 481 million journeys through Salik’s gates were registered last year.

Future growth plans for the business could include Salik introducing dynamic pricing at its toll gates — higher toll fees for specific lanes or during peak hours — which would increase revenue and reduce congestion, its prospectus said.