Algeria’s Transport Ministry has signed a contract worth an estimated $3.3bn with two Chinese contracting firms for the design and build of a major transhipment port located between the cities of Cherchell in Tipaza and Tenes in Chlef.

The contract was signed on 17 January with the China Harbour Engineering Company (CHEC) and China State Construction Engineering Corporation (CSCEC), according to a local media report.

The value of the actual contract has exceeded the preliminary estimates published in 2015, which placed the value of the project to about $1.9bn.

A consortium will be formed between the two contracting parties, with the structure of this company to be finalised in March. The project has a seven-year construction timeline, with initial services to commence within four years. China’s Shanghai Ports Group will be managing the port although it is not clear whether the operation and maintenance of the port is included in the $3.3bn deal.

Participation by the Shanghai Port Group is being seen as helpful in driving transhipment traffic from Southeast Asia to the Cherchell port. It could also help increase cargo movement between Algeria and Africa via using Algeria’s rail network, Algeria’s Transport Minister Boudjemaa Talai was quoted as saying.

The port is envisaged to feature 23 docks capable of processing 6.5 million 20-foot containers and 26 million tonnes of goods per year. 

The Transport Ministry expects annual port traffic in Algeria’s central region to peak to 35 million tonnes or two million 20-foot equivalent unit (TEU) by 2050.