DUBAI: DP Worldwill spend US$1.6 billion on a new terminal at its flagship Jebel Ali port in a huge boost for trade through Dubai.
The move will boost capacity by 16 per cent and cater to future growth in the UAE and the region.
DP World will add 3.1 million twenty-foot equivalent units (TEUs) in Jebel Ali port by building a fourth terminal that will increase the overall capacity to 22.1 million TEUs by 2018.
The port is already on track to boost capacity by 11.8 per cent to 19 million TEUs in the second half of this year by expanding Terminal 3.
Jebel Ali is the biggest port in the Middle East and North Africa region.
Sultan bin Sulayem, DP World’s chairman, said the expansion was in response to customer demand for greater capacity at Jebel Ali. They are expecting trade to increase in the lead-up to Expo 2020, he said.
“Shipping lines will be able to bring more of the world’s largest vessels to our terminals, so helping to improve the efficiency of the region’s supply chain,” he said. Terminal 4 will be situated on a reclaimed island that could be expanded further, boosting future capacity to a total of 7.8 million TEUs, depending on market demand.
Separately, DP World throughput rose 4.1 per cent to 30.6 million TEUs in the first half of this year on the same period last year, thanks to volume growth in Europe and its UAE terminals. At its local terminals, DP World handled 7.9 million TEUs in the first half, up 6 per cent from a year earlier.
“Europe continues to show steady growth despite the difficult geopolitical environment,” said DP World.
“The Asia-Pacific and the Indian Subcontinent region delivered an improved performance in the second quarter and the recent capacity addition at Nhava Sheva [India] should provide further room for growth. Performance at the Americas and Australia region has been broadly flat due to soft economic conditions.”
Given its strong first-half performance, DP World expects to exceed the market volume growth forecast of 3 per cent for this year.
It handled 60 million TEUs across its global container terminals last year, up 8 per cent on 2013.
Last year, the port operator posted a 11.7 per cent rise in net profit to $675 million on an 11 per cent increase in revenue to $3.4bn, as container volumes grew across its global network of ports.
DP World, which operates more than 65 terminals, could boost its total capacity to exceed 100 million TEUs by 2020, depending on market demand.
To reach that goal, it is acquiring terminals and expanding existing ones.
In April, DP World said it had agreed to acquire a second terminal in Canada for C$580m (Dh1.63bn) as it seeks to boost its capacity and capture trans-Pacific trade between Asia and North America. Maher Terminal’s Fairview container terminal on Canada’s west coast has a capacity of 850,000 TEUs and the expansion will lift its capacity to 1.35 million TEUs in the first half of 2017.
DP World issued a $500m bond in May, its first such issuance in eight years, to help fund this growth.
