The local subsidiary of Hong Kong-based Hutchison Ports has officially started the 25-year concession agreement to operate the container terminal at Saqr Port located in the UAE’s northern emirate of Ras al-Khaimah.

Financial details of the agreement were not disclosed but the overall structure entails an annual fee that will be paid by the government to Hutchison Ports Ras al-Khaimah (RAK).

The terminal comprises four berths and has a capacity to handle 350,000 twenty-foot equivalent units (TEUs) annually. The terminal features an 800-metre long quay with a depth of 12 metres, in addition to a 20-hectare yard.

The terminal, under the management of the Saqr Port Authority, has previously handled an estimated 150,000 – 200,000 TEU annually.

According to Cliff Brand, Hutchison Ports RAK general manager, the firm is aiming to reach a similar level of volume initially, which will then be increased to 300,000 – 350,000 within three years.

The ultimate goal is for the terminal to reach 800,000 TEUs within eight years, Brand tells MEED.

Hutchison estimates that the volume of trade generated by industries located in Ras al-Khaimah stands at 300,000 TEU. “Business already exists in RAK to enrich the capacity of the port, it is just a matter of encouraging businesses here to ship directly through the port in Ras al-Khaimah rather than through Dubai,” explains Brand. “Manufacturing industries located here no longer have to rely on the ports in Dubai to ship their goods, they can ship directly through the RAK port, which in itself will create cost efficiencies and help stimulate business [growth].”

The main Saqr Port, which deals mainly with bulk products such as aggregates, is being expanded. Netherlands’ Bam International won the contract for the expansion work at the port earlier this year.