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Emerging player

ADPC explains how it is taking Abu Dhabi into the maritime big league.
US$7.2bn Dollars invested so far in Khalifa Port and Kizad.
US$7.2bn Dollars invested so far in Khalifa Port and Kizad.

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There’s a comprehensive overhaul of Abu Dhabi’s maritime infrastructure taking place. And it’s not just the multi-billion dollar construction of the brand new Khalifa Port that is set to have a big impact on Abu Dhabi’s long term economic development.

Mina Zayed, no longer the entry point for Abu Dhabi emirate’s container traffic, is being re-invented as an entry point for cruise tourists and new vehicles. Out in Al Gharbiah, the emirate’s western region, a number of local ports are being re-developed in order to boost local economic and leisure activity.

Names like Mugharrag, Delma, Mirfa and Al Sila may not currently be well known, but will become more and more prominent as investment pours into Al Gharbiah in an effort to develop the region.

The jewel in the crown, of course, is the brand new, highly automated, multi-billion dollar Khalifa Port. Now able to handle 1.3 million TEUs annually, the addition of new gantry and automatic stacking cranes will soon take that figure to 2.5 million TEUs annually. Beyond that, there is scope for even further, considerable expansion.

The organisation responsible for overseeing this enormous investment in Abu Dhabi’s ports infrastructure is Abu Dhabi Ports Company, currently led by acting CEO, Mohamed Juma Al Shamisi.

Along with having to ensure these projects land within their budgets and deadlines, ADPC has been given the challenge of ensuring that Khalifa Port and Kizad (the industrial zone adjacent to Khalifa Port) deliver 15% of the Emirate’s non-oil GDP by 2030. Referring to the diverse number of projects on ADPC’s books, Al Shamisi says, “Our mandate is to develop all of them”.

Construction of Khalifa Port began in 2008, but the decision to build it was taken some years before that as it became clear Mina Zayed was reaching its container capacity of 750,000 TEUs per year. With little room to expand around the port, which is located in downtown Abu Dhabi city, the decision to build on a greenfield site outside the city was taken.

The need for the new port was subsequently demonstrated when, in just a single year, container throughput leapt from 545,000 TEUs to 767,000 (2011). “We couldn’t wait any longer to finish Khalifa Port,” says Al Shamisi. “We were running over capacity here [Mina Zayed] and we needed more room to breathe.”

The need for a new, expanded port was obvious, but the size and scope of Khalifa Port is huge. What has been planned is not just an entry and exit point for ships. Adjacent to Khalifa Port is Khalifa Industrial Zone Abu Dhabi (Kizad).

The ambition for Kizad, as stated by ADPC, is clear: to create one of the world’s largest industrial zones. Khalifa Port is the entity that will feed it, bringing in the raw materials used by factories located in the zone and then re-exporting the finished products.

As Al Shamisi explains, “Our vision moving forward is not just to be a port provider leasing land. We want to add value to our clients by serving them from door to door.”

The total area set aside for Khalifa Port and Kizad is 417 square kilometers, development of which is tentatively penciled in for completion by 2030.

Right now, however, the focus is on developing Khalifa Port and Kizad Area A. This area, a mere 51 square kilometres of the total area, has an official development budget on its own of US$7.2 billion.

Khalifa Port, which sits on an artificial island, covers just over nine square kilometers and is home to a container terminal, terminal operations building and warehouses. The construction of Khalifa Port and Kizad is clearly, therefore, not just about giving Abu Dhabi more container capacity.

“We believe Khalifa Port is meant to be there for two main reasons,” explains Al Shamisi. “One is to support Abu Dhabi’s growth. The second is to support the growth of Kizad. All of these industries [in Kizad] require cargo going in and cargo going out.”

The headline tenant of Kizad is Emirates Aluminium (Emal), a major aluminium producer. “Using Emal as an example, all the commodities it needs come through Khalifa port, and they are manufactured in Kizad where we have modern infrastructure and gas, water, and electricity,” explains Al Shamisi.

“Then, goods can be transferred and shipped from Khalifa Port. You are providing a total solution and this is why we are building Khalifa Port and Kizad attached to each other. It’s an industrial area and an industrial port.”

Emal has been operating in Kizad and using Khalifa Port since 2010. The launch of commercial container terminal operations and the formal inauguration of Khalifa Port took place in 2012.

It was decided at the planning phase that Khalifa Port would become Abu Dhabi’s hub for container traffic and Mina Zayed would cease to handle containers. Despite the advance notice and time to prepare, relocating container operations was always going to be a large undertaking.

Starting in September 2012, however, ADPC says that all container operations were relocated from Mina Zayed to Khalifa Port in just four months. “Usually, it takes from six months to one year if you want to transfer from one port to another,” says Al Shamisi.

Key to achieving this rapid transfer of container traffic was communication, the CEO stresses. “The trick is to be close to your clients and keep them updated with the progress of Khalifa Port as we are building it, to engage with them long before they start operating in Khalifa Port,” he explains.

“You have to map out the processes you will be using in a proper way and show that you are not going to hamper their business. They see a risk in moving from one place to another and you have to manage this by bringing them on board with you as you are developing.”

One teething problem that had to be dealt with is trucking prices, which leapt after the move to Khalifa Port. From around AED 600 for the trip between Mina Zayed and Musaffah, firms were now charging up to AED 1400 between Khalifa Port and Musaffah, an increase in distance of around 15km.

A memorandum of understanding was consequently signed with Agility, a major logistics services provider, to cap the price between Khalifa Port and any destination in Abu Dhabi at AED 800.

ADPC makes much of the fact that Khalifa Port is a fully automated port, using state of the art technology for everything from the gates to the scanners. Making sure everything worked properly required extensive testing and debugging ahead of the start of operations in 2012.

Now, ADPC says the benefits are being felt. Whereas it would take “hours” to clear cargo manually at Mina Zayed, a truck turnaround (the time it takes for a truck to enter the port and leave with its load) is 25 minutes at the new port. “This is not a benchmark within the region; it’s a benchmark worldwide,” the CEO claims. “What does the customer really want? The customer cares about time, money and ease of doing business.”

Another KPI that ADPC is proud of is its level of gross moves per hour (GMPH), a key measure of port productivity. Khalifa Port is now hitting a level of 30 GMPH per crane; Al Shamisi says that 26 is the typical figure within the region. The next target for Abu Dhabi Terminals, the company running the port’s container terminal, is 35 GMPH.

The current container handling capacity at Khalifa Port is effectively 1.3 million TEUs per annum. Three new gantry cranes will join the existing six and 12 new automatic stacking cranes (ASCs) will join the existing 30 by the end of this year. Another three gantry cranes and 10 more ASCs will arrive in 2014, taking total capacity to 2.5 million TEUs per annum and 12 million tonnes of general cargo.

That capacity is a long way from the 750,000 limit that existed at Mina Zayed and the blueprint for Khalifa Port and Kizad envisions capacity of 15 million TEUs and 35 million tonnes of general cargo by 2030.

While goods exported from the plants in Kizad may eat up some of that capacity, it seems inevitable that Khalifa Port will need trans-shipment traffic to fill its capacity. Perhaps that might bring it into direct competition with some of the other ports located in the GCC.

Al Shamisi says that Khalifa Port will, “to a certain extent” need the re-export business to fill capacity, but insists that it is, “not our intention to compete with other ports”. Instead, he focuses on Kizad as the main unique selling point of Khalifa Port.

After minimal growth in container throughput last year, as traffic transferred from Mina Zayed to Khalifa Port, ADPC hopes for considerable growth this year. An increase of around 30% is expected year on year, which would take TEU volume past the million mark.

The transfer of Abu Dhabi’s container traffic to Khalifa Port has, of course, opened a huge amount of space at Mina Zayed. Although an older port, with much legacy infrastructure and little space to build around it, it seems the port’s best days are far from behind it.

It is currently being developed as a luxury cruise terminal and a hub for roll-on/roll-off (ro-ro) cargo. The seemingly endless rows of cars lined up on the tarmac inside the port (visible from the ADPC head office building) are clear testament to that. Another possible use for the port is as a hub supplying equipment and goods for oil & gas installations.

With the construction of Khalifa Port, a new direction for Mina Zayed and the refurbishment of ports in Gharbia, these are exciting times for the maritime sector in Abu Dhabi. If ADPC’s plans all come to fruition, Abu Dhabi could soon emerge as one of the world’s major shipping hubs.

About Khalifa Port and Kizad
- The first phase of Khalifa Port and Kizad Area A has been built at a budget of AED 26.5 billion (US$7.2 billion).
- Phase one was delivered ahead of schedule and under budget.
- This megaproject represents the largest infrastructure undertaking ever made in Abu Dhabi Emirate.
- Kizad Area A is 51 sq km (including Khalifa Port).
- By 2030, Kizad Area A and B will form one of the largest industrial zones in the world at 417 sq km.
- Khalifa Port covers approximately nine square kilometres, including the Port Island (home to the container terminal, its Terminal Operations Building and warehouses), whose area is 2.7 sq km.
Source (all fact boxes): ADPC

Khalifa Port facts
Quay Length
- Main berth: 2400m
- West quay wall: 800m
- Emirates Aluminium quay wall: 800m
- Channel Length: 11.5km / 7 nautical miles
- Channel Depth: 16.5 metres
- Channel Width 250 metres
- Alongside Draft 18 metres
- Basin Draft 16 metres
- Max. Vessel Draft 15m (above on application)

Handling Equipment
6 Super Post-Panamax ship-to-shore (STS) cranes, 32 automated stacking cranes (ASC), 20 Straddle Carriers; an additional 3 STS and 12 ASC cranes are on order

Types of Cargo
Containers, Reefers, General Cargo, Dry & Liquid Bulk, Ro-Ro and Project cargo

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