Megaproject NEOM by Saudi Arabia has hit turbulence after a huge find. Saudi Arabia’s $2 trillion futuristic city had the intention of signifying the country’s move from oil to discovery and innovation; however, the latest discovery has raised concerns about the project’s priorities. With delays in the project and the costs continuing to rise, questions pertaining to the project’s leadership and future are being asked. Could a luxury palace in the middle of nowhere change the project’s future?
The project is delayed, but there has been a palace discovery
According to a satellite image, all thanks to Maxar Technologies, a luxury complex under construction was captured in the NEOM region in January 2025. The featured palace includes multiple swimming pools, private beaches, a golf course, and key buildings all linked to Prince Mohammed bin Salman, who also chairs the board of NEOM.
The royal residence has progressed significantly despite the delays faced by the NEOM project. However, many critics are questioning why the royal residence is progressing, but NEOM’s key projects like The Line, which is a 110-mile vertical city, have not been progressing. The Line, which was anticipated to be open in 2034, should have been in its first phase of construction already.
The concern is that the palace construction is well underway while the project’s national goals are being unmet. Many critics have stated that public resources are being misused instead of going towards the technological and environmental aspects of this flagship project.
The lack of transparency with regard to finances
An internal audit of NEOM had revealed hints of financial manipulations in an attempt to downplay the escalating costs. The price required to complete NEOM by 2080 now stands at $8,8 trillion, which exceeds Saudi Arabia’s national budget.
Lack of transparency is noted as financial teams were encouraged to inflate the projected revenues so as to show a higher Internal Rate of Return (IRR), selling greater profitability prospects to investors. The lack of transparency in terms of the actual finances has misled investors considerably. Based on the red flags, CEO Nadhmi al-Nasr was removed in 2024 from the project. As per the reports, project managers who raised the project’s expectations and finances were dismissed from the project. However, the removal of the former CEO raises more questions pertaining to the project, with McKinsey & Company akso facing scrutiny as the planner and validator of NEOM’s financial models.
What does the future hold for this NEOM project?
NEOM promised hydrogen plants, flying taxis, and AI-driven governance in alignment with Saudi Arabia’s 2030 vision. However, at present, NEOM is merely a construction site with one royal palace being developed. Not much progress is reflected from satellite footage. NEOM is not as ambitious as it is made out to be.
According to NEOM’s spokesperson everything seems to be on track. It has yet to be seen if NEOM is just a very expensive vision or if NEOM’s ambitions to incorporate technology and sustainability can be realized by 2030. At the moment, the huge secret building with enigmatic purposes has caused NEOM to be in trouble.
Much curiosity about NEOM and the development
With the revelation of the hidden palace, or rather the secret building at the very core of NEOM’s development, many critics are concerned that NEOM’s priorities have changed completely, and the palace signifies more deeply rooted issues. While Saudi Arabia is still pushing forward project NEOM, investors and the public seem more reluctant to buy into the vision. With the palace being built, many critics argue that the city with futuristic value is a fortress holding onto the past. Could we also be saying goodbye to NEOM as Saudi Arabia reveals the biggest hydrogen city in history, with 400,000 tons annually?
