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Ports & Logistics Sector in Saudi Arabia

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Ports & Logistics Sector in Saudi Arabia Sector briefing Ports & Logistics Opportunities in Saudi Arabia Why Saudi Arabia? Saudi Arabia's eight major ports, with a total of 183 piers (making it the largest seaport network in the Middle East), handle 90% of the country's trade, including imports and exports. Jeddah's strategic central location on the Red Sea coast of the Arabian Peninsula and on a major East West trade route has, for millennia, sustained its importance as a trading port and entrepot. The Saudi Ports Authority recently announced that the Kingdom is envisaging an investment of SR 30 billion (US$ 8 billion) on modernising and equipping all of its ports with the “The Saudi Ports Authority participation of private sector. recently announced that the Kingdom is envisaging an Find general information on the Saudi Arabian market conditions on UKTI’s website. investment of SR 30 billion www.uktradeinvest.gov.uk. The Doing Business (US$ 8 billion) on Guide for Saudi Arabia gives an overview of modernising and equipping all Saudi Arabia’s economy, business culture, of its ports with the potential opportunities and an introduction to other relevant issues. participation of private sector.” UK Trade & Investment Sector briefing: Ports opportunities in Saudi Arabia Opportunities the Red Sea close to the industrial city of Jeddah already gives it an advantage. The With major expansion and development plans development master plans see it becoming the for both the existing and new ports, coupled largest port in the region, equipped to receive with the intention to expand the role of the the largest shipping vessels and providing private sector and to restructure the role of the connections to onward road, rail and air Saudi Ports Authority, there will be increasing transport networks. In addition to the existing opportunities for UK companies in many areas. volumes of traffic through the Red Sea, KAEC The privatisation of a number of activities and itself will create around 10,000 businesses and the creation of further BOT port facilities industries, all with shipping requirements. presents opportunities for the provision of legal There is also an opportunity to create a world- services to bidding consortia and possibly the class port that can become a hub for Saudi Ports Authority. There will also be transhipment. potential for port planning and development consultancy, port security, equipment supply, Emaar Economic City, spearheading the and port operation contracts. development of KAEC on the Saudi Red Sea coast, recently announced a preliminary accord King Abdullah Economic City Port Project with Saudi Bin Laden Group over the joint – estimated cost US$ 5 billion venture, which will start work to build the port. King Abdullah Economic City (KAEC) seaport This does not meant the cancellation of an project (Industrial & Commercial), extending initial agreement signed in April 2008 by Emaar over 14 square kilometres has been announced with DP World. The first phase of the port will and an MOU has been signed by the ports cost SR 4 billion (US$ 1.07 billion) with operator DP World. The seaport will be the operations expected to start in 2012 resulting largest in the Red Sea and one of the top 10 in a port with capacity for 1.7 million ports in the world, with a capacity to handle 20 containers. million TEU. Two logistic port areas – US$ 40 million & It will be equipped to receive the new US$ 186 million generation mega-vessels, with a nominal Saudi Ports Authority will announce public capacity of in excess of 10,000 TEU and will tenders for the development of two logistic utilise global positioning technologies, operation areas at Jeddah Islamic Port, worth advanced information management systems US$ 40 million and for King Abdul Aziz Port in and automated processes. It is predicted that a Dammam, worth US$ 186 million. multipurpose cargo terminal is scheduled to be operational by end of 2012 and a 1.6 million Three new container terminals under TEU container terminal by mid-2013, after B.O.T systems which the capacity of the port will be increased A tender for establishing three new container in several phases. terminals under B.O.T systems will be announced for Jeddah, worth US$ 400 million, The KAEC Sea Port will become part of Saudi Dammam Port US $ 210 million and Dhiba Port Arabia’s vast transportation and port network for US $ 96 million. and seeks to capitalise on untapped opportunities by leveraging on its strategic Bunkering terminals at all eight Saudi location on the Red Sea, one of the most ports – US$ 135 million important sea routes between the East and Bunkering terminals are to be established at all West. The Seaport will be integrated with the the eight Saudi ports worth US$ 135 million. industrial zone and logistics hub to provide a Tenders of these projects are to be announced seamless logistics operation within KAEC that soon. will further promote regional trade. Ship repair yards – US$ 150 million This port will be situated between the holy Two ship repair yards are to be developed at cities of Makkah and Madinah, 80 Dammam and Jeddah Islamic Ports worth US $ kilometres north of Jeddah, estimated to cost 150 million. US$ 990 million. It will have a purpose built Hajj terminal, complete with hotels capable of Privatisation of ports services receiving more than 300,000 pilgrims every The privatisation of ports services is a major season. The strategic location of the port on improvement in the five year plan of the Saudi UK Trade & Investment Sector briefing: Ports opportunities in Saudi Arabia Ports Authority, offering 21 port services receive the first ship at port in September contracts to the private sector. 2010. New container terminal – King Abdul Aziz Other opportunities Port, Dammam – US$ 430 million With the announcement of Jazan Economic City A new container terminal will be established at (JEC), a new industrial port has recently been King Abdul Aziz Port in Dammam at a cost of announced as part of the government's efforts more than SR 1 billion(US$ 430 million). The to boost the region's development; this is project will be implemented on a build operate- thought to cost some SR 3 billion. transfer (BOT) basis. Studies have been completed on the new container terminal and A plan has been approved for construction of tenders will be invited within a few months to three new petrochemical berths at King Fahad implement the project, which will be open to Industrial port at Jubail Industrial City and 9 Saudi and foreign companies. new berths at King Fahad Industrial port at Yanbu. Under the plans to be submitted to the Saudi Transport Ministry, a 400 square metre The Royal Commission of Yanbu and Jubail is container terminal will be built next to the developing a plan to double the capacity of the port's existing free zone. The terminal would petrochemical industry in the town. A key element of the plan is the buildingof a new add 1.5 million twenty foot equivalent units chemical quay at the King Fahd Industrial port, (TEUs) to the port's capacity of 1.7 million. Yanbu for exporting both liquid and solid This is being propsed by the Dammam Bonded petrochemicals and enhancing the facilities at & Re-export Zone (BBRZ), which is eight years the Jubail Commercial ports as well. Bechtel is into a 30 years concession to run the free drawing up plans for both ports. zone. It hopes to expand the range of services at the site, enhancing its commercial appeal. It A contract has been approved for the hopes to develop the free zone and container deepening of King Abdul Aziz Port to a depth of facility side by side, as they have done at Jebel 18 metres, including a channel leading to the Ali in Dubai. Dammam port is already linked to docks worth SR 200 million. Saudi Ports Riyadh by rail, and is set to assume greater Authority will announce public tenders for the significance with the development of the Saudi development of two logistic operations areas at landbridge, which will link it to the country's Jeddah Islamic Port and King AbdulAziz Port in largest port in Jeddah on the Red Sea coast, Dammam. Feasibility studies are currently via a rail line. being conducted for the rest of the Saudi ports. Industrial port at Ras Al Zour – US$ 600 Additional ground equipment viz.: Diesel and million – work in progress Electric Forklifts, Terminal tractors, Container A contract for US$ 600 million to build an chassis, Straddle carriers, Empty container industrial port at Al-Zour has been handlers and container Scanning units. Port awarded to China Harbour Contracting management and consultancy and port safety Company and work is in progress. They & security equipment and systems have partnered the local Rafid Group on the project to form the China Harbour If you have any questions on the opportunities Engineering Arabia Company. The Saudi Port above, contact the UKTI contacts named in this Authority has issued a letter of intent to China report. Business opportunities aimed Harbour for an engineering, procurement and specifically at UK companies are added daily to construction contract. UKTI’s website. These leads are sourced by our staff overseas in British Embassies, High The port will serve nearby fertiliser and Commissions and Consulates, across all sectors aluminium smelting complexes. Three berths and in over 100 markets. will be built to handle general, dry bulk and liquid cargo. The port will cater for vessels of You can be alerted to business opportunities on up to 70,000 dead weight tonnes and handle a regular basis by registering on the UKTI bauxite, process chemicals and other website.
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