Industry park to drive Abu Dhabi's new port, CEO says

Khalifa Port expects to reach an initial target for container handling capacity in five years

Abu Dhabi's new Khalifa Port, built at a cost of $7.1 billion, expects to reach an initial target for container handling capacity in five years on the back of a growing industrial park nearby, a top executive of the management company said.

The port at Taweelah, midway between Abu Dhabi and Dubai, became operational in September. Since then 30 percent of container traffic has been transferred from Abu Dhabi's older port, Mina Zayed.

In six months, all container traffic is to have migrated to the new port, which has a phase-one capacity of 2.5 million TEUs (twenty foot equivalent units). That limit is expected to be reached by 2017, said Tony Douglas, chief executive of Abu Dhabi Ports Co (ADPC).

"The Khalifa Industrial Zone Abu Dhabi (Kizad) is a linked proposition to the port. As it starts to populate, tonnes of feedstock will come in," he said in an interview late last week.

This year the port expects to handle 800,000 TEUs, rising to 1 million TEUs in 2013, he said.

Oil-rich Abu Dhabi, capital of the United Arab Emirates, is investing billions of dollars in industry, tourism and infrastructure as it seeks to diversify its economy beyond oil.

Kizad, which also became operational this year, has Emirates Aluminium as its anchor tenant with several other industries setting up shop in the first phase, which spans 51 square kilometres (20 square miles).

"A cluster for steel, heavy engineering, food and others is well underway at Kizad," Douglas said, adding that 25 percent of the area was now occupied.

Other ports nearby are also expanding, including Dubai's Jebel Ali port, the regional leader. Douglas said he was not worried by competition.

With about 8 per cent underlying annual growth recorded by ports in the region over the last few years and Khalifa focused on growth from Abu Dhabi's own economy, there is enough business for all, he said.

"About 95 percent of containers that come into the port stay with Abu Dhabi, not for transshipment," he said. Besides, Abu Dhabi's petrochemical exports are increasing in volume, he added.

The second phase of Khalifa Port's development will double container handling capacity, but that is planned for 2017 and beyond, Douglas said.

Unlisted ADPC, which manages both the emirate's ports and Kizad, made its first profit in 2010, four years after it was set up, he said, while declining to give specific figures. The state-owned firm obtains funding from the Abu Dhabi government.

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