AD Ports Group said Saturday that it has signed a 30-year concession agreement to develop, manage and operate the Egyptian multi-purpose terminal in the Red Sea port of Safaga.
The ports operator also signed three head of terms (HoT) concerning ports located in the Red Sea region and the Mediterranean Sea, which will facilitate the expansion of the group’s activities in the North African country.
These agreements allow for expanded access to multipurpose terminals, cruise routes, and logistics capabilities in Safaga, Ain Sokhna, Port Said, Hurghada, Sharm El Sheikh and Al Arish. AD Ports Group and the Red Sea Ports Authority signed a 30-year concession agreement that allows the Group to develop and operate a multi-purpose terminal at Safaga Port, a strategic location on the Red Sea coast of Egypt.
“AD Ports Group’s significant concession agreement with the Red Sea Port Authority for the development of Safaga Port has the potential to play a major role in the global supply chain, evidencing, once again, that our key strategic partnerships in Egypt drive the advancement of the Group’s portfolio of value-added investments,” said Mohamed Juma Al Shamisi, managing director and Group CEO of AD Ports Group.
Safaga Port will be the first internationally operated port in the Upper Egypt region, bringing significant cost savings to traders, industries and businesses located in this region.
The terminal will be developed over an approximate area of 810,000 square meters and is set to be operational in Q2 2025. It will boast a quay wall of up to 1,000 meters and it will have the capacity to handle 5 million tonnes of dry bulk and general cargo, one million tonnes of liquid bulk, 450K TEUs of containerised cargo, and 50K CEUs of RORO.
AD Ports will invest a total of up to $200 million in superstructure and equipment, buildings and other real estate facilities and utilities network inside the concession area. The majority of this CapEx will be spent in 2024 and 2025.
There will be no currency exposure associated with the operations of the port as all revenues will be dollarised.
The agreements for the development of two cement terminals in Al Arish Port and West Port Said Port were signed between AD Ports Group and the General Authority for the Suez Canal Economic Zone requiring a combined investment of EGP 1 billion (around US$ 33 million- at current prevailing market rates) in both terminals.
Under the 15-year agreements, which are subject to the approval of the General Authority for the Suez Canal Economic Zone Board, AD Ports Group will construct silos with a storage capacity of up to 60,000 tonnes in Al Arish Port and 30,000 tonnes in West Port Said; each terminal will be able to handle 1.0 – 1.5 million tonnes annually.
Both terminals which will be operational in Q42023, are expected to contribute to doubling Egypt’s cement exports to global markets.
The MoU for potential collaboration in various transportation and infrastructure projects, with an initial focus on the development of the East Port Said multi-purpose terminal, as well as a logistics zone and economic zone, was signed between AD Ports and The General Authority for the Suez Canal Economic Zone.