Aqaba's port complex undergoing redevelopment and expansion

In recent years, Aqaba’s port complex has been undergoing major redevelopment and expansion. At the same time, as Jordan’s sole seaport and main import-export funnel, Aqaba has been responding to the challenges posed by regional security issues, while remaining a major charger for the kingdom’s economic growth. Indeed, the most recent Department of Statistics figures, for 2013, show that the port was responsible for 55% of Jordan’s entire export trade. In terms of imports, the figure was even higher – 73% came through the port that year.

A Steep Ascent

Aqaba has been a meeting place for Middle Eastern, European, African and Asian traders for centuries. All could take advantage of its strategic location. In modern times, Aqaba became a preferred route for international trade, not only with Jordan, but also with Iraq, Saudi Arabia and Syria. In the period to 2004, the port developed into three main areas – the main port, the industrial port and the container port – run by the Aqaba Ports Corporation. Recognising the port’s special significance for the country and the region, the government set up the Aqaba Special Economic Zone (ASEZ) in 2000, under its own autonomous authority, the ASEZ Authority (ASEZA). In 2004 ASEZA and the government of Jordan then launched the Aqaba Development Corporation (ADC) in an effort to accelerate development further. ADC now owns Aqaba’s seaports, airport and most other facilities, while also fulfilling a management function over these and related infrastructure and utilities. The ADC undertakes these responsibilities in line with the ASEZ Master Plan, drawn up by ASEZA in 2002. The master plan sees private sector involvement as crucial for its success, with public-private partnerships and a build-operate-transfer model preferred. A good example of this is the Aqaba Container Terminal (ACT) – since 2006 owned 51% by APM Terminals and 49% by ADC – which the Jordanian government has held up as a model of this type of venture.

Privatisation

The privatisation of the terminal took its first major step forward in 2004, when ADC signed a concession with APM Terminals – part of the AP Möller-Maersk Group – to manage and operate the container terminal. In 2006 this was expanded into a 25-year joint development agreement. APM has achieved some notable success in boosting efficiency at the port. In 2006 monthly throughput was 405,658 twenty-foot equivalent units (TEUs), while by 2013 this figure had more than doubled to 872,809 TEUs. In-transit TEUs – those going through Aqaba but destined for other countries – rose from 26,307 TEUs to 92,097 TEUs over the same period, while gantry crane productivity increased from 24 moves an hour in 2007 to 29 in 2013. Between 2005 and 2014, the average dwell time of imported full containers fell from more than 14 days to nine. Over the same period, the terminal went from receiving about seven vessels per week with an average size of 1600 TEUs to 9-10 vessels per week with sizes reaching 8700. A $140m berth expansion project has recently completed at ACT, bringing investment since 2006 to over $280m. The project was contracted to BAM International and MAG, and adds 460 metres to the quay, taking it up to a full 1000 metres, while also adding six new cranes. This expands capacity to 1.2m-1.3m TEUs.

The ASEZ also includes development and upgrading of other terminals. These include a liquefied natural gas (LNG) terminal, a liquefied petroleum gas (LPG) terminal, a new phosphates terminal, a miscellaneous liquids terminal, an industrial port, a new passenger terminal, an oil terminal, and an entirely new port, located to the south of the city. All infrastructure that will connect with these developments – both land and sea – are being developed and extended too.

BAM-MAG Partnership

The New Port has so far been a BAM International-MAG contract, with the partnership completing its work in June 2014. The €65m ($86.29m) project involved the construction of four new berths, with a total of 800 metres of quay wall, a breakwater, intake and outfall pipes, revetment work, pontoons, a slipway and other marine services infrastructure. The New Port has three distinct terminals – a roll-on/roll-off and general cargo terminal; a grain terminal; and the new passenger terminal. These will largely replace the current terminals located in Aqaba’s main port.

The BAM International-MAG partnership, working with BAM Contractors, is also behind the new LNG terminal, located 19 km south of Aqaba. The project involved construction of a 100-metre trestle on steel pipes, a 20x20 mooring platform, a 700-metre long pipeline to the onshore tie in, as well as a range of control systems and onshore logistics and transport infrastructure. The terminal was launched in July 2015. The LPG terminal, meanwhile, is a JD17m ($23.92m) project capable of receiving vessels of up to 25,000 tonnes. It has an unloading capacity of 300 cu metres per hour. The $240m phosphates terminal features a new dry bulk export jetty, along with dust and spillage control facilities, and moves the old facility belonging to Jordan Phosphate Mines Company (JPMC) in Aqaba’s main port to the city’s industrial, South Port. The new facility has a handling capacity of 6m tonnes per year. JPMC is also in the consortium contracted by ADC for the redevelopment of Aqaba’s industrial terminal, which handles fertiliser and chemical exports. The expansion is being undertaken by JPMC in partnership with the Arab Potash Company, with the works scheduled for completion in 2016.

The industrial port is home to an oil jetty, which is also undergoing an upgrade, along with the addition of new oil storage tanks. ADC has contracted the Aqaba Petroleum Company for this project, which will enable the jetty to accommodate much larger vessels of up to 350,000 dead weight tonnes. Some 14m tonnes of crude oil, oil products and miscellaneous chemical liquids can be handled by the upgraded facility. At the same time, the new miscellaneous liquids jetty will take many of the liquids currently being handled by the existing oil jetty.

Challenging Times

The port expansion and upgrades look set to keep Aqaba on its current course as the main destination port for Jordan and its neighbours. Yet these have been times of conflict for many of those countries, with this negatively affecting transit trade as well as passenger numbers. Other challenges have been more connected with the accompanying logistics chain than with the port itself. With a railway link to Amman still at the planning stage, trucking remains the only form of distribution. In 2013 over 330,000 trucks were handled at ACT’s gates, with bottlenecks sometimes developing.

Nonetheless, the challenges are being addressed in various ways. Aqaba continues to utilise its unmatched strategic location to demonstrate its irreplaceability for Jordan’s transport sector.

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The Report: Jordan 2015

Transport chapter from The Report: Jordan 2015

The Report: Jordan 2015

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