Source: Journal of Commerce
September 6th 2015
Plans to dredge a nearly 6 mile channel at Port Said as well as develop the entire region surrounding the New Suez Canal remain on hold, reports suggest.
The New Suez Canal, which opened last month, allows two-way traffic on the canal for the first time, creating economic benefits for both international shippers and the local economy. The expansion has been touted as a key component of SCZone plan, which envisions logistics, shipping and industrial development at three primary nodes along the canal: Ismailia, Ain Sokhna-Suez and Port Said.
The Cairo Post quoted Suez Canal Authority chairman Mohab Mamish as stating that the authority had agreed to contract the Alliance of Challenge – the six contractors that completed dredging the new canal – to dredge the 6 mile-long channel via the northern access at Port Said.
“We have decided to resume the project with the Alliance of Challenge. The new canal will increase the economic value of the area,” he was reported as saying, adding that “dredging was estimated to cost around $60 million and work would begin “as soon as the New Suez Canal is inaugurated.”
However, there was no word of the project at the ceremony in early August celebrating the $8 billion, 44.7 mile extension to the Suez Canal. And there has been no official green light from Egyptian President Abdel-Fattah el-Sisi, despite his statement to the recent World Economic Forum Annual Meeting that once the expansion opened, “the second phase will entail developing the canal zone and opening the door for investment.”
Spokespersons at dredging contractors Boskalis, Jan De Nul, DEME, Van Oord, and NMDC all told IHS Maritime, a sister product of JOC.com within IHS, no official news on the project’s start date had been reported.
The channel, projected to be 60.7 feet deep, 820 feet wide – allowing vessels to sail in both directions simultaneously – and taking about seven months to build, would enter the Suez Canal roughly 12 miles south of its northern entrance. It would not only slash waiting times at Port Said, enabling ships to sail straight through to the canal, but has been promised for years.
Even though there is no official word yet that these ambitious plans will start in 2015, President Abdel-Fattah el-Sisi’s achievement in driving forward the new canal remains impressive. The numbers include 44.7 miles of new channel and bypasses built in 12 months, $8.5 billion raised in Egypt to pay for the expansion project, $13.2 billion projected annual revenue by 2023 (up from $5.3 billion today), 97 ship transits a day by 2023 (up from 49) and an 11-hour southbound transit, down from 18 hours.
U.K. Chamber of Shipping CEO Guy Platten commented, “The existing canal has done wonders for world trade, but this extension is akin to turning a B-road into a fully-fledged motorway. The volume of trade moved by sea will double in the next 20 years and dramatically increasing the number of ships able to move through the canal will facilitate new growth”.