Abu Dhabi Ports Expect Year-End Spike In Traffic As Projects Boom

State-owned Abu Dhabi Ports Co (ADPC) expects a surge in shipping traffic towards the end of this year as work on major infrastructure projects in the United Arab Emirates capital gathers pace, the company’s chief executive said.

Container traffic at Khalifa Port is expected to climb to around 1.1 million twenty foot equivalent units (TEUs) in 2014, up 22 per cent from 905,000 TEUs in 2013, when traffic rose 17 per cent, Mohamed Juma al-Shamisi said in an interview.

Meanwhile, general and bulk cargo traffic at the emirate’s Khalifa and Zayed ports combined is expected to top 12 million tonnes this year, up from 9.3 million tonnes in 2013 and roughly the same volume in 2012.

“It is going to be a big jump but all the givens that we have at the moment are pointing towards it,” Shamisi said.

“We expect a big rise in the last quarter of this year in general and project cargo, because most of the vital projects in the emirate of Abu Dhabi will be in the maturing stage. We expect from September and into next year there will be a spike.”

Khalifa Port, built on a man-made island roughly half-way between Abu Dhabi and Dubai, came on stream in 2012 after Zayed Port, which had been serving Abu Dhabi for over 40 years, reached full capacity.

The new port faces competition from other rapidly growing facilities in the region including Dubai’s huge Jebel Ali port, which is only about 40 kilometres (25 miles) north along the Gulf coast. Shamisi’s projections, however, suggest demand related to Abu Dhabi’s construction projects will keep activity at Khalifa growing for a while.

Abu Dhabi is investing billions of dollars in infrastructure, real estate and tourism to diversify its economy beyond oil. Strategic projects underway or in the pipeline include the expansion of Abu Dhabi International Airport, the the Abu Dhabi Louvre museum, and construction of a nuclear power station, where the first reactor is expected to start operations in 2017 and others are planned to follow in 2020.

ADPC is owner, operator and developer of Abu Dhabi’s civilian non-oil ports, and also its industrial zones. It is therefore expected to benefit from expansion plans scheduled for industries located in the adjacent Khalifa Industrial Zone Abu Dhabi (KIZAD), which is projected to provide 15 percent of Abu Dhabi’s non-oil gross domestic product by 2030.

“Through Khalifa Port, Emirates Aluminium (Emal) for example receives all of its raw materials and exports its aluminium to all over the world, and now that they are increasing their capacity, this will increase the traffic as well,” Shamisi said.

MANUFACTURERS

Emal’s $4 billion project to boost its aluminium production capacity from around 800,000 tonnes a year to 1.3 million is ahead of schedule and expected to near completion in mid-2014.

Other manufacturers using Abu Dhabi ports include Emirates Steel, which is projected to import around 5 million tonnes of raw material in 2014, and plastics and polymers maker Borouge.

Khalifa Port now has an annual capacity of 2.5 million TEUs, which could be raised to 5 million TEUs in the first phase of the port’s development depending on demand. Abu Dhabi’s long-term goal is to increase capacity to 15 million TEUs of containers and 35 million tonnes of bulk cargo by 2030.

All container traffic was transferred from Zayed Port, in Abu Dhabi’s city centre, to the new Khalifa Port when it opened in 2012. Zayed still handles some general cargo; “Port Zayed will continue to serve Abu Dhabi but we want it now to focus on cruise vessels,” Shamisi said.

Ninety-two cruise vessels called at the port in 2013 with over 160,000 tourists visiting Abu Dhabi through the port. Construction of a permanent terminal to receive tourist ships is underway.

“The facilities that are there now are working but are only temporary, and we are working on having permanent facilities for cruise vessels and developing the infrastructure,” Shamisi said.

“This is a natural cycle for ports, where the city grows around the port and then the facility reaches full capacity and is transformed into a tourist hub while commercial activity moves elsewhere.”