Cairo scales back Suez Canal redevelopment project

07 December 2007
The redevelopment of the Suez Canal is to be scaled back because of concerns over the economics of the project.

The Suez Canal Authority (SCA) has postponed plans to deepen the canal from 66 feet to 72 feet, pending further studies. A plan to widen the canal at certain sections remains under consideration, but the two will not take place together.

“We will deepen or widen the canal, but for the moment we will not do both and bring other economic projects along as well,” says Ahmed Elmenakhly, executive vice-president for planning and research at the SCA.

Dredging is already under way to increase the draught of the canal from 62 feet to 66 feet. This work will be completed in 2008 and was to be followed by a further increase to 72 feet by 2010, the maximum depth possible for the waterway (MEED 19:10:07).

At present the canal is too shallow for large oil tankers when fully laden. Increasing the draft was intended to correct this, but the SCA has concluded that the revenue gained will be outweighed by the huge cost of the dredging work.

“The cost of deepening the canal to 72 feet will be huge,” says Elmenakhly.

“There are benefits but we do not expect to get an economic return on this project, which is why it has been postponed and is being studied again. The draught increase to 66 feet may be the most the cost-effective option or we may consider a width increase instead.”

Only 68 kilometres of the 190km canal are wide enough for vessels to pass side by side. The plan to widen the canal would increase this to 98km, speeding up the rate at which ships can pass through.

Since the majority of the canal's traffic is container vessels, which are untroubled by the shallower draft, the SCA appears to be leaning towards widening the route rather than catering for more oil tankers.

The authority already has an arrangement with the Sumed pipeline allowing tankers to discharge sufficient oil to make them light enough to pass through.

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