The Saudi Railways Organisation (SRO) will start work on the Saudi Landbridge project after receiving approval from the authorities.
The $7bn project includes the construction of a 950km line between Riyadh and Jeddah, and a 115km line between Dammam and Jubail, along with three freight stations and two passenger stations in Jeddah.
It has also unveiled plans to partially operate the country's north-south railway within three months and complete the Riyadh freight train project within two years.
The SRO will also purchase ten locomotives and improve railway services, and has allotted funds for a central signal and control system in a bid to improve railway tracks and complete high-speed train tracks.
SRO plans to expand railway lines to regions outside Al-Ahsa in eastern Saudi Arabia, purchase four advanced trains and install modern signal systems along the lines.