NEOM has involved contractors, subcontractors, suppliers, consultants and specialist businesses across some of Saudi Arabia’s largest construction and infrastructure programmes.

As major projects evolve, individual packages can also be changed, reduced, suspended, delayed or terminated.

For a contractor or subcontractor, the important question is not simply whether the project has changed.

It is:

Have all of your contractual and commercial entitlements been properly identified before your account is closed?

If you have worked on a NEOM project and still have unpaid work, outstanding variations, retention, delay issues or an unresolved final account, it may be worth having your position reviewed.

Why NEOM Contractors Should Review Their Commercial Position

In June 2026, Semafor reported that NEOM’s 2026–2030 budget included approximately SAR 60 billion (US$16 billion) in anticipated payments to contractors associated with terminating long-term agreements. The report also noted that the final amount could change depending on negotiations with contractors. Semafor

This should not be described as a general SAR 60 billion “claims fund”. It is a reported budget provision associated with contract termination payments.

Read the Semafor report on the reported SAR 60 billion provision

There are also publicly confirmed examples of contract changes.

On 25 March 2026, Webuild announced that NEOM had exercised termination for convenience of its Trojena dam contract. Webuild said the works were approximately 30% complete and that accrued costs, together with costs connected with early termination, site disengagement and demobilisation, would be reimbursed in accordance with the contract and applicable law. webuildgroup

Webuild official announcement — Trojena contract

Webuild also announced in May 2026 that NEOM had terminated its Connector High-Speed Line contract in Sharma, Tabuk, after the project had previously been suspended. The company again stated that incurred and early-termination costs, including demobilisation, would be reimbursed in accordance with the contract and applicable law. webuildgroup

Webuild official announcement — Connector High-Speed Line

These examples do not mean that every contractor or subcontractor has a claim.

They do, however, demonstrate why businesses with unresolved commercial matters should carefully review their own contracts, records and outstanding accounts.

1. Do You Have Completed Work That Remains Unpaid?

For some contractors, the issue may be relatively straightforward.

You may have:

• completed work awaiting certification;
• certified amounts still outstanding;
• disputed measurements;
• unpaid retention;
• materials delivered but not fully valued;
• deductions you do not agree with;
• work completed but omitted from the latest account; or
• an unresolved final account.

The first step should be to identify exactly what remains outstanding and why.

A proper review should ask:

What work was completed?

What has been certified?

What has actually been paid?

What remains disputed?

What does the contract say about payment and certification?

A structured commercial reconciliation can often identify issues that have simply remained unresolved during a busy project.

2. Have You Carried Out Additional or Changed Work?

Variations are another important area to review.

Additional or changed work may arise through:

• revised drawings;
• additional quantities;
• changed specifications;
• design revisions;
• RFI responses;
• site instructions;
• changed construction sequences;
• omissions; or
• additional works requested during execution.

One common problem is that the contractor performs the work first and commercial agreement is left until later.

By the time the account is reviewed, the response may be:

“There is no approved Variation Order.”

That does not automatically determine whether entitlement exists.

The contractual position should consider:

What was included in the original scope?

What changed?

Who instructed the change?

Was notice required?

What records exist?

How should the work be valued?

Did the variation also affect completion?

A variation may therefore create both a cost issue and a time issue.

3. Has Your NEOM Package Been Delayed?

Delay can arise for many reasons, including:

• late access;
• delayed drawings;
• delayed approvals;
• changed sequence;
• delayed preceding works;
• interface problems;
• variations;
• suspension;
• revised design; or
• other events affecting planned progress.

Depending on the contract and facts, some of these events may potentially support an Extension of Time (EOT) claim.

However, delay alone does not automatically create entitlement.

A properly supported EOT claim normally needs to establish:

Delay Event → Contractual Entitlement → Notice → Evidence → Programme Impact → Time Claimed

The earlier this is reviewed, the easier it is to preserve the documents and programme information needed to support the position.

4. Has Your Scope Been Reduced or Omitted?

A reduction in scope can have wider commercial consequences than simply removing the value of the omitted work.

A contractor may already have incurred:

• mobilisation costs;
• project management costs;
• design expenditure;
• procurement commitments;
• subcontract liabilities;
• material orders;
• site establishment costs; or
• other expenditure based on the original scope.

The contract should therefore be reviewed to understand:

• the right to omit work;
• how omitted work should be valued;
• what happens to commitments already made; and
• whether any other contractual consequences arise.

The answer will always depend on the actual contract.

5. Has Your Work Been Suspended?

Suspension can create a different commercial problem.

A contractor may remain contractually committed while work is reduced or temporarily stopped.

During that period there may still be costs associated with:

• management;
• supervision;
• labour;
• accommodation;
• plant;
• temporary facilities;
• security;
• utilities;
• subcontractors;
• insurance; and
• other project resources.

The key questions include:

When did the suspension or slowdown begin?

Was there a formal instruction?

What resources remained committed?

Could those resources reasonably be redeployed?

What records exist showing the actual effect?

The contractual provisions should then be examined before deciding whether any additional entitlement exists.

6. Has Your Contract or Subcontract Been Terminated?

Termination requires careful review because entitlement can differ significantly depending on the contractual mechanism used.

For example, termination for convenience may have very different consequences from termination for contractor default.

Depending on the contract, matters requiring review may include:

• executed work;
• certified but unpaid amounts;
• outstanding variations;
• materials purchased or manufactured;
• procurement commitments;
• subcontract liabilities;
• demobilisation;
• site disengagement;
• retention;
• outstanding claims; and
• final account adjustments.

It is important not to assume that every cost is recoverable.

Equally, it is important not to close the account without first checking what the contract actually provides.

7. Subcontractors Should Review Their Own Contract

Subcontractors can be particularly exposed.

Your contractual relationship may be with the main contractor rather than directly with NEOM.

A decision under the main contract therefore does not automatically determine your entitlement under the subcontract.

Questions worth examining include:

• What happens if the main contract is suspended or terminated?
• What termination provisions exist in the subcontract?
• Are the provisions genuinely back-to-back?
• How is completed work valued?
• What happens to outstanding variations?
• What happens to retention?
• What notice periods apply?
• What happens to materials already ordered?
• Are there outstanding payment applications?
• Has the final account been agreed?

Your own subcontract should therefore be reviewed independently.

8. Do You Have an Unresolved Final Account?

A final account should not simply become a negotiation over one headline figure.

Break the account down into:

• Original Contract Value
• Approved Variations
• Outstanding Variations
• Measured Work
• Retention
• Outstanding Payments
• Claims
• Deductions
• Materials
• Termination or Demobilisation Items
• Other Contractual Adjustments

This makes it much easier to identify where the actual disagreement lies.

A contractor may discover that its largest unresolved entitlement is not the unpaid invoice it was originally concentrating on.

9. Protect Your Records Before the Project Team Moves On

Where work is being reduced, suspended or closed, preserve the project records while they remain available.

Important records may include:

• signed contracts and subcontracts;
• BOQs;
• scope documents;
• drawings and revisions;
• instructions;
• RFIs;
• variation registers;
• payment applications;
• payment certificates;
• programmes;
• programme updates;
• progress reports;
• contractual notices;
• meeting minutes;
• photographs;
• material records;
• labour records;
• plant records; and
• relevant correspondence.

Good records do not create entitlement where none exists.

But where contractual entitlement does exist, those records can be critical in proving it.

10. Not Sure Whether You Have a Claim?

You may simply not know.

You do not necessarily need to commission a major claim report just to find out whether there is anything worth pursuing.

Start with four questions:

What happened?

What does your contract say?

What money or time remains unresolved?

What evidence do you have?

A preliminary contract and commercial review can often determine whether there appears to be a reasonable basis for further work.

Free Initial NEOM Contract and Claim Review

PactWise Consulting offers contractors and subcontractors a free initial consultation and preliminary review of their position.

If you have worked on a NEOM project and are experiencing issues involving:

• unpaid work;
• outstanding payments;
• unresolved variations;
• additional work;
• Extension of Time;
• project delay;
• retention;
• suspension;
• reduced scope;
• termination; or
• an unresolved final account,

contact PactWise for a free initial review.

We can look at the circumstances, key contractual documents and available records and help identify whether there appear to be potential contractual or commercial entitlements worth investigating further.

There is no assumption that every contractor has a valid claim.

The purpose of the initial review is simply to establish:

What happened?
What does the contract say?
What remains unpaid or unresolved?
Is there a reasonable contractual basis for further action?

How PactWise Can Help

PactWise Consulting provides construction contract, commercial and claims support to contractors and subcontractors across Saudi Arabia.

Our services include:

• contract and subcontract reviews;
• Extension of Time claims;
• variation claims;
• outstanding payment reviews;
• final account reviews;
• contractual notices;
• suspension and termination reviews;
• delay and disruption claims;
• subcontractor claims;
• commercial reconciliation;
• claim preparation; and
• review and strengthening of existing claims.

Having Problems With Unpaid Work or an Unresolved NEOM Contract?

Contact PactWise for a free initial consultation and preliminary claim review.

We may be able to help identify contractual entitlement that has not yet been properly recognised or presented.

PactWise Consulting
Contracts. Commercial. Claims