DP World to 'slow down' Jebel Ali port expansion

21 August 2016

Phase 1 of Terminal 4 under construction

Dubai-headquartered port operator DP World has said it will slow down, but not stop, the pace of construction work on Terminal 4, whose original completion date was set for 2018. It will also delay the 1.5 million twenty-foot-equivalent-unit (TEU) capacity expansion for Terminal 3 until 2017.

While “construction work will not stop”, according to Sultan Ahmed bin Sulayem, DP World group chairman and CEO, he did not specify a new completion date for Terminal 4.

The local/UK Dutco Balfour Beatty and the Netherlands’ Bam International have been awarded civil construction contracts for the first phase of Terminal 4.

Dutco Balfour Beatty is developing an operational yard area with a quay length of 1,200 metres while Bam International Abu Dhabi is building a 400-metre bridge and adjacent causeways, in addition to the 2.2km quay wall with a depth of 18 metres, designed to accommodate the largest container vessels.

Bin Sulayem said the Jebel Ali port’s expansion strategy has to match the business environment. "We will be ready to react depending on market requirements,” the executive explained, indicating that slowing down the capacity build-up in Jebel Ali reflects slowing volumes.

Volumes in the UAE were down by 6 per cent, at 7.4 million TEUs during the first half of 2016, a trend the company has attributed to a reduction in lower margin cargo.

Growth for the rest of the Middle East, Europe and Africa region, outside the UAE, however, has continued to outperform, mainly driven by the ramp-up at the London Gateway, DP World said.

Overall, the port operator’s earnings and revenues for the first half of 2016 grew 50 per cent and 10.2 per cent, respectively, compared with the same period in 2015.

Bin Sulayem said the company is confident it will meet its full-year target despite a challenging market environment and slowing global trade.

Terminal 4 is being built on a reclaimed island north of Jebel Ali Port’s existing Terminal 2, and is designed to have a capacity of 3 million TEUs. It will be connected to the mainland by a 3,000-metre causeway.

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications