Aden port development and the Opening of the Aden Container Terminal [Archives:1999/31/Business & Economy]
August 2 1999
1 of 2 in a series
By: Captain Abdul Moti H. Mohammed
Introduction to the paper
Aden has been a major regional center at various times over the past 3000 years. Over this long time span, visitors with vision have always been impressed by the port and by the opportunities for trade which it offers. Marco Polo and Ibn Batuta both noted the prosperity of Aden as a shipowning center.
Just under 160 years ago Captain Haines and the British arrived, to stay for 125 years. Captain Haines stated when Aden was a small village of around 600 persons, that Aden could again become a major trading center. The latter part of the British period proved him correct and Aden grew to become one of the busiest ports in the world.
Aden was declared a Free Port in 1850 as it took control of Yemen’s coffee export trade. From 1869 the Suez Canal shortened the sea distance between London and Bombay for over 10,700 miles around the Cape of Good Hope to 6270 miles through the Mediterranean and Red Sea.
Aden’s coal bunkering and re-provisioning trade accelerated. Aden was fortunate to be connected to the London/Bombay telegraph cable in the 1870’s, giving it great advantage in east/west communications. By 1901, Aden Inner Harbor had been dredged to 30 feet to handle the largest ships of those days.
In 1919 Aden introduced oil bunkering and became, by the 1950’s, one of the world’s top ship bunkering ports, handling up to 6,300 ships a year. Calls by cargo and passenger vessels made Aden the world’s 4th largest tax-free shopping port. It became the regional base for dhow, coastal, and deep-sea traffic. Dhows trading between the Gulf, Pakistan, the Red Sea and East Africa were regular callers and Aden handled over 1500 dhows annually in the mid-1900’s.
The oil refinery and oil harbor were built in 1955 and Aden began to import and refine crude oil, primarily to provide the oil fuel needed by the ships bunkering at Aden.
Why Aden?
What makes Aden so uniquely suitable for its’ role as a port and distribution center in the region? Aden offers shippers and shipping companies many advantages, which have helped to make the port a regional center during its long history and will continue to favor it in future.
These advantages may be summarized as follows:
– The port lies where the Red Sea and Gulf of Aden meet, directly on the main round-the-world and the Far East to Europe/America trade route.
– It requires a deviation from this route of only 4 nautical miles to reach the pilot station.
– It has clear approaches from waters 20-40 meters deep without reefs, well marked by aids to navigation.
– A well-planned and easy channel extends only four miles from the fairway buoy to the inner harbor berths;
– Aden offers deep water in one of the world’s largest natural harbors, protected from prevailing, winds during winter months by hills 500 meters high to the south and east and from the summer SW monsoon by hills 350 meters high to the south west;
– It enjoys clear weather and is able to operate for 365 days a year.
– Aden is around 4570 miles from NE Europe and 3640 miles from Singapore, around 9 days from Europe and 7 from Singapore on modern container ships.
– It is very well placed to provide transshipment services to East Africa, the Red Sea, the sub-continent and the Gulf, and;
– It enjoys a dry climate with temperatures of around 28c through the winter and 38c during the summer (between May and September).
Based on these splendid advantages. Aden developed and expanded its port services until 1967. When the Suez Canal closed for 8 years. This, added to the uncertainties following national independence, led to a severe downturn in Aden’s trade at a time when other states in the region were beginning to generate substantial oil revenues. New ports in the region handling massive amounts of construction and project cargo then grew to become major cargo centers in the 1970’s and 1980’s.
Aden had no facilities for handling containers during these years and was starved of investment capital. All dry cargo was handled at buoys in the inner harbor before being transferred to the Home Trade Quay by lighters. Double handling; the accepted means of working cargoes in most ports up to the 1960’s, continued at Aden into the 1980’s.
The Ma’alla Terminal
The Port Authority fully realized that cargo-handling methods at Aden had to change and that the solution was to build new berths. By 1988 YPA had secured finance generously provided by the Arab Funds to construct the Ma’alla Multi-purpose Terminal.
This gives the port its first alongside berths for large dry cargo vessels in its history. In 1993 the first container gantry quay crane arrived. A second crane was delivered in 1995, which now allows Aden to offer container transshipment services.
1997 and 1998 have seen steady growth, with 1998 showing an accelerating upward trend in number of ship calls and tonnages of bulk, general and containerized cargoes, Container volume almost doubled between 1994 and 1997.
In 1997 13,456 TEU were handled, in 1998 57,537, and increase of 427% over 1997. Volume will reach over 100,000 TEU at Ma’alla in 1999 thanks to the recently generated volume transshipment containers.
Recent developments
Although, with the construction of the Ma’alla Terminal, trends were positive, the port was very conscious during the 1990’s that Aden’s position as a service and distribution center for the Region had been lost to competitors. YPA has always believed that it was entirely possible to restore Aden to its former position as major port. Various developments in international shipping made the mid-1990’s the right time to act.
Aden comes late to the modern container transshipment business, but there are certain advantages in this. The growth in ship size, re-grouping of shipping companies and changes in international trade patterns favor a terminal built specifically to serve the new generation of container ships, in the right location, offering a high standard of service.
Following unity in 1990, various studies by British, World Bank and other consultants concluded that Aden’s geographical location would allow it to develop significant container transshipment services. The Free Zone Authority was established in 1990 and a concession agreement to construct and operate a new container terminal and Industrial Development Zone was approved in November 1995.
Port design objectives
In considering the design of the new container terminal, YPA had certain objectives which it wished to see implemented. These are summarized as follows:
– The Terminal should have a depth alongside of 18 meters to allow the world’s largest container ships to be berthed, and to allow for any likely future growth in ship size.
– The Terminal should be aligned in such a way those ships entering the inner harbor would have sufficient sea room in which to stop and turn.
– The Terminal should be designed with adequate space for future expansion as traffic increases.
– The turning area should be able to turn of 350 meters or more in length.
– The quay wall should be constructed in mass concrete, without any reinforcing, to avoid cracking and the need for repair work in future.
– The inner harbor should be dredged across its full width to provide operational flexibility.
– Dredged material should be used to maximize benefit to the port and to the nation by providing new areas inside the inner harbor for future port expansion.
– The Terminal should be equipped to handle the world’s largest container ships.
Various meetings with the concessionaires were held before construction work commenced and, with some compromises, the requirements of the Port Authority were implemented. YPA considers that it has given the concessionaires every assistance since dredging commenced in mid-1997 to ensure that they were able to complete their work without hindrance from this Government body.
The results of this cooperative approach by the port are now evident in the opening of the Terminal.
Aden Container Terminal (ACT)
Yeminvest and PSA Corporation, with Hyundai as main contractors, are completing the new deepwater container terminal on the North Shore, known as the Aden Container Terminal (ACT).
The quay wall for the ACT can be taken to a depth of 18 meters, four meters deeper than Jabel Ali, Jeddah or Colombo. The ACT will be able to handle the world’s largest existing and planned container ships. Initial dredging is being carried out to 16 meters (53 feet) alongside and in the outer section of the channel. Tidal patterns effectively give the port 16.8 meters alongside for 18 hours each day almost the whole of the year.
The first phase of the North Shore berths, 700 meters in length, is being opened in March 1999. Phase II will provide a further 350 meters and Phase III 600 meters to give a Terminal length of 1650 meters. Other phases are expected to follow.
The terminal has been equipped with the latest super post-Panamax quay cranes, with an outreach of 57 meters. Rubber-typed Yard gantry cranes, reefer points, engineering maintenance and other facilities to match and support quay crane capacity are also being installed. A power station, desalination plant and sewage treatment plant are also being built.
Commercial and economic impact of the Aden Container Terminal
The Construction of the ACT and the restoration of Aden’s former position as a regional service and distribution center will be a key element in the economic development of Yemen. Its’ importance to the port, to the city of Aden and to Yemen cannot be over-emphasized. YPA believes that this terminal and the associated ‘Fee Zone’ will prove to be the ‘key’ project to attract inward investment for infrastructure development and a wide range of industrial activities.
The project “makes a statement” on improvements in political and economic stability in Yemen over the past three years which other investors can recognize and respond to. There is already evidence that major companies outside Yemen are responding.
There will inevitably be competition from other Regional Ports. Some of these grew impressively over the past 30 years and traffic in the more successful ones in dominated by container transshipment. Container movement worldwide increased at around 8-9% annually in the 1990’s and is predicted to grow at between 7-8% until 2010. Container handling was a market which did not exist when Aden was a major bunkering port, but has become a market which Aden can and will bid to share.
A growing percentage of the very large container ships that currently handle the world’s ‘break-bulk’ cargoes are now in the 6000+ TEU class. Ships carrying over 4,500 TEU’s, which currently make up only 2% of the world fleet, are forecast to form 33% of the world’s container fleet by 2010.
With the Aden container Terminal coming into service this year, Aden is ready to handle ships of this size, and larger, and to re-gain its position as a regional hub port.
Meanwhile, Ma’alla Terminal continues to provide an important service for the port and the nation. It generates valuable foreign exchange earnings from the revenue earned by handling transshipment containers and also allows Yemen to import, with much greater efficiency, the raw materials and finished products required as foodstuffs and for the construction and other industries, which the country requires. The small, but growing export market is also served by Ma’alla.
In future it is anticipated that the ACT and Ma’alla will complement each other, with the smaller mainline and feeder container vessels using Ma’alla for their transshipment business and the largest ones calling at the ACT.
Marine services
YPA has been under pressure in recent months in the provision of its marine services to the inner harbor, fishing harbor, oil harbor and other harbor. Demands on its pilotage, towing and mooring services have increased with the growth in container transshipment business.
It has taken action to improve these services by bringing in addition pilot boat, mooring boat, two work boats (small tugs) and harbor tugs. It is now arranging for the repair and extensive refurbishment of the two older Voith Schneider propelled tugs so that the new ones can be primarily allocated for use by container ships at the ACT and Ma’alla. It also plans to order two additional larger tugs.
Other port activities
Aden is not only a container port. Other services have been provided in the past and will be provided in future. The Ma’alla Terminal was defined as a ‘Free Port’ area, which now offers duty-free storage, re-export and other Free Port services to traders and shippers operating in Yemen.
Ship bunkering is an obvious example of the services which Aden continues to offer. There is considerable interest in expanding present facilities and developing new ones to offer in-harbor and offshore bunkering services.
New bulk handling equipment at Ma’alla, greater economic activity and higher efficiency allowed Aden to raise its tonnage for major imported commodities by 87% in 1996 over 1995. YPA predicts that will increase to 1.4 million tones by the end of the century and to 1.9 million tones by 2003.
Ship repair services are also being seen as having considerable potential for expansion, and several companies have already looked at the National Dockyard with a view to refurbishing and expanding this. Classification Societies which were formerly based at Aden may be expected to re-establish offices at Aden. Aden already operates an important Fishing Harbor, with a large cold store for the country’s ‘fish wealth’, and fishing vessel repair services.
Marine surveying and insurance services will grow. At the airport a ‘cargo village’ will support sea-air cargo business. Crew changing, supply of spare parts for machinery and electrical items, ship stores etc. are also expected to expand.
Calls by passenger ships, at around 18-20 per year at present, help to develop the growing tourist business in Yemen, while yachts find Aden a good place to visit for fuel, stores and communications and many now call during the winter months.
Future port development
When one looks at the chart of Aden, the size of the natural harbor contained inside the rim of hills and shore is impressive. The twelve kilometers east-west and six north-south provide a very large area of sheltered water.
When Captain Hanes first surveyed the harbor in 1835, water depths on the south side of what is now the inner harbor were around 20 feet. It needed 11 years to complete the first deepening program to increase the depth to 30 feet.
Dredging technology has moved on and the current deepening by 4 meters has taken a total of around 30 weeks. Sea bed materials of excellent quality are being used for constructing Phase I to II of the YPA has reclaimed over eighty hectares of land on the north side of the Rubble Mound for future construction.
YPA visualizes the expansion of the port to the west, to provide a sheltered basin within the natural basin formed by hills and shore. I would be developed for various purposes, including industrial processes which need access to deep quay space. Yemen can provide workers for some of the most labor-intensive industries currently looking for sites and, with easy access from all points of the compass, it would be difficult to improve on Aden’s location.
Conclusions
Visitors to the Port of Aden often comment that Aden is a very ‘real’ place. A real city, with real people, with a real port in a place where God intended one to be. After years of decline and under-utilization, Aden will enter the next millennium challenging other for its rightful place as major distribution center. The dreams of three years ago are being transformed into to ACT.
YPA believes in the future of Aden, and hope that many of you will have good cause for optimism and confidence in Aden in the coming months and years. We trust that you will catch something of the vision we have whenever we look out from the hills which gthis port.
You will be following in the steps of some very famous travelers.
Port of Aden, Republic of Yemen
March _1999_
While a great deal of interest has focused on the new Aden Container opening in March this year, the revival and expansion of port activity at Aden is already very evident from the success of the Ma’alla Terminal operated by Yemen Ports Authority (YPA).
The Ma’allah Terminal, which was opened in 1991 and is equipped with two Panamax capable quay gantry cranes, has successfully attracted regional container transshipment business to the port over the past 12 months. The Singapore-based Pacific International Line (PIL), has now used Aden for its transshipment operations between Red Sea ports and the Far East since June 1998. Yemen Ports Authority has provided PIL with a cost effective and efficient service, helping to boost Terminal container throughput from 13,456 TEU’s in 1997 to 57,537 TEU’s in 1998, an increase of 328% over the twelve months. On an annual basis, the Ma’alla Terminal expects to work close to 100,000 TEU’s in 1999 as present trends continue.
In addition to the additional business generated by container transshipment, the port has seen a useful rise of 45% in national container imports and exports from 13,456 to 19,505 TEU’s in 1998. This comes mainly from the rise in general cargo imports, but partly from a 7 fold improvement in fish exports in 1998, resulting in much-increased use of the 32 reefer points at the Ma’alla Terminal.
The Port Authority has been examining its requirments for additional countainer handling equipmetn to further improve its transhipment services at Ma’alla. Aden looks forward to again becoming a major player in the region on the basis of its success at Ma’alla and the additional business which the Aden Container Terminal, run by PSA Corporation, will bring to the port.
Bulk and other dry cargoes imported at the Ma’alla Terminal have also improved from 885,934 tons in 1997 to 1,285,370 in 1998, a rise of 45%. Exports have increased from 74,312 tons in 1997 to 380,369 tons in 1998, a rise of 412%. This was partly due to the rise in containerized exports, but also more than doubled in 1998.
YPA took timely delivery of two new tugs, a pilot boats and other support craft in 1998 to improve its marine services and is actively pursuing the acquisition of two further tugs and other craft in 1999.
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