COSCO Shipping to build terminal in Khalifa

Khalifa port

Khalifa port. Credit: Abu Dhabi Ports Co

 

COSCO Shipping has come to an agreement with Abu Dhabi Ports to build and operate a new container terminal in Khalifa port.

Through a special purpose vehicle, CSPL SPV, COSCO Shipping expects to pay USD738 million to operate the terminal for 35 years, with an option to extend the lease for five years.

The terminal, to be called KPCT2, will have a quay length of 1,200 m and a water depth of 18 m, with channel depth of 16.5 m. The first 800 m of the quay will begin operations in 2018 and the remaining 400 m will operate from 2020.

By 2020, the terminal will have an area of about 70 ha, with three berths and an annual handling capacity of 2.4 million teu.

Should COSCO Shipping decide to extend the lease, another 600 m of quay length will be made available, which will increase the annual handling capacity to 3.5 million teu.

COSCO Shipping said in a Hong Kong Exchanges & Clearing filing that KPCT2 was located along the ‘Silk Road Economic Belt and the 21st Century Maritime Silk Road’, and the shipping hub of the west Asia region.

Khalifa, where KPCT2 is located, is one of the major gateway ports of Abu Dhabi. It is also strategically situated between Abu Dhabi and Dubai, with minimal deviation from the Strait of Hormuz and with excellent hinterland connections and geographic location.

After Piraeus in Greece, KPCT2 will be the second overseas terminal in which COSCO Shipping holds a controlling interest.

COSCO Shipping said, “This investment is expected to strengthen the company’s sustainable growth and create value for shareholders. With the strong support from the large container shipping fleet of COSCO Shipping Group, the company will dedicate its efforts to develop KPCT2 [for calls] by international container shipping liners as a hub of the upper Persian Gulf region in the Middle East.”

Meanwhile Chinese online finance magazine Caixin quoted COSCO Shipping chairman Xu Lirong as having expressed interest in acquiring Hanjin Shipping’s terminals after the company went into receivership.

Contact Xiaolin Zeng at arachelle0@gmail.com