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Edging a lead in game of catch-up

West African countries are striving to build modern port and rail infrastructure, whilst overcoming inefficiency and corruption

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Once expansion is completed, Tema Container Terminal will accommodate vessels up to 14000 TEU.
Once expansion is completed, Tema Container Terminal will accommodate vessels up to 14000 TEU.

A great deal of international attention on the Nigerian port sector has focused on if and when new container capacity will be provided, most notably at Lekki. Yet levels of efficiency and corruption are probably much bigger concerns, both for existing ports and for any new container terminals that are built. Unless progress is made on both fronts, West Africa’s biggest economy by far will continue to lag behind its regional rivals, both in terms of port capacity and
performance.


The clamour for Nigeria’s main ports to be connected to the country’s rail network has intensified over the past couple of months. Plans to revitalise the country’s dilapidated railways have made little headway over the past decade, so the lack of rail services to existing and planned ports was not a major concern.


However, China Civil Engineering Construction Corporation, backed by Chinese financing, now looks likely to build a modern railway from Lagos northwards, so trade bodies are pushing for connections with the Lagos ports and the planned port of Lekki. The new north-south railway will be standard gauge, in contrast with the Cape gauge used on the country’s existing lines.

 

The Nigerian Ports Authority (NPA) is particularly keen to ensure that a rail link is built to Lekki, not only to serve the planned container terminal, but also the proposed 650,000 b/d Dangote oil refinery. In April, CMA CGM signed an MoU to operate a container terminal at the port, although it remains to be seen whether it will stick to the original plan of developing it in three phases – 1.5M TEU/year in Phase 1, rising to 2.7M TEU/year, and then 4.7M TEU/year. China Harbour Engineering Company (CHEC) and Louis Berger Group began construction work on the project in February.


NPA managing director Hadiza BalaUsman said: “Before we took over, two years ago, there was no provision for a rail connection out of Lekki in the deepsea port plan, which I found quite strange – that you can have a deepsea port without the need for a rail connection. It will take you two years to build the port, but five years to build the rail. So, we have written to the Nigerian Railway Corporation to ensure that there is a rail connection.”


Speaking at the International tion of Ports and Harbors conference in Abuja in September, President Muhammadu Buhari joined the debate, insisting that the Lagos ports must be connected within three years.


“We understand that this interconnectivity will improve the country’s economic competitiveness as targeted under the Economic Recovery and Growth Plan,” he said. “So, for starters, I have directed that every port must have the
complement of rail infrastructure. Our projection is that, by the end of 2021, we will have standard gauge railway across the main north-south trading route.”


Despite the relative weakness of government finances, national transport infrastructure does finally seem to be improving. River ports are already being constructed, and the federal government reports that 25 highways are either being upgraded or built from scratch. CHEC’s planned port on the Benin River will be used mainly to export palm oil and other agricultural products.


The Nigerian Shippers’ Council has appealed for rail links to the inland container depots under construction around the country, as well as the ports.


Tema on target


Work on developing the biggest container terminal in West Africa appears to be on course. Tema Container Terminal in Ghana, which is being developed by Meridian Port Services (MPS) – a consortium of APM Terminals, Bolloré Transport & Logistics and Ghana Ports and Harbours Authority (GPHA) – will have the capacity to handle 3.5M TEU/year once completed, and will be capable of accommodating vessels up to 14,000 TEU. The biggest vessels currently using the port have capacities of about 5,000 TEU.

 

A Ghanaian spokesperson for the Chartered Institute of Logistics and Transport (CILT) said: “We believe that work is on schedule, and by June next year, as indicated, the first two berths will be handed over, and the overall berths
will be completed by 2020. This will enhance the capacity of the Port of Tema and, in fact, open the economy of Ghana to more traffic.” The breakwaters being built at Tema are believed to be the longest in West Africa, at 1,800m.

 

MPS is due to receive its first substantial cargo handling equipment at the end of December, comprising eight E-RTGs and four STS cranes from ZPMC. Under a deal signed in August 2017, the Chinese firm will deliver another 12 E-RTGs and three more STS cranes next year. The 27 cranes are being supplied at a total cost of US$82M. All of the STS cranes are of super post-Panamax design, with on outreach across 23 rows of containers.


It is being reported in Ghana that this is the biggest crane contract ever awarded in West Africa, and this seems likely to be correct. Mohamed Samara, CEO of MPS, said: “With the rise in terminal capacity due to the efficiency of these cranes, there is bound to be a ripple effect on development in all areas of the economy. This is an investment for the growth of our nation.” The new terminal will be completely paperless, while GPHA, which is port landlord (as well as one of the MPS consortium), describes itself as 99% paperless.

The NPA’s Hadiza Bala-Usman is determined to get Lekki rail-connected
The NPA’s Hadiza Bala-Usman is determined to get Lekki rail-connected

Twin projects for DP World DP World has announced that it plans to set up a logistics hub in landlocked Mali to connect with coastal ports, mainly in Senegal, but possibly also in Cote d’Ivoire and Ghana. In September, it signed a 20-
year concession with the Government of Mali to build and operate the facility on a 1,000-ha plot of land outside the capital, Bamako, close to the main road and railway west to Senegal. It will eventually have a handling capacity of 0.3M TEU/ year and 4 Mtpa of bulk and general cargo.

 

Work on Phase 1, which is expected to cost US$50M, is expected to start next year, and take 18 months to complete. The Dubai-based firm has an option to extend its concession by another 20 years. The facility, which is designed to speed up the processing of cargo entering and leaving the country, is to be operated on a paperless basis. Under the terms of the deal, DP World is also to provide the government with three locomotives to operate on the Bamako-Dakar railway.


Sultan Ahmed Bin Sulayem, CEO and chairman of DP World, commented: “The Malian market is expected to grow over the next two decades, and is driven by robust economic and population growth. Thus, the Mali Logistics Hub is
much needed, and will provide the country with a logistics platform that aims to facilitate the import and export of goods via the Port of Dakar.”


DP World’s interest seems obvious. It already operates the existing container terminal at Dakar, and is set to start work on a bigger container facility, Port du Futur, at the Senegalese port by the end of this year. The biggest established ports in West Africa all lie on the Gulf of Guinea, rather than on the Atlantic coast, but Port du Futur could change that, including by capturing trade to and from the landlocked Sahelian states that has traditionally been controlled by Abidjan in Côte d’Ivoire, and more latterly Tema. Located next to Dakar’s new airport and a new industrial and processing zone, it will have a handling capacity of 1M TEU/year.

The first berth at Kribi container terminal
The first berth at Kribi container terminal

Concession for Kribi

 

The long-running saga over the contract to operate Kribi Multipurpose Terminal in Cameroon appears to have reached a turning point. In 2015, French firm Necotrans and a consortium of Cameroonian companies called KPMO signed a oncession to operate the terminal, before the former ran into financial difficulties. In January, Necotrans was declared to have defaulted on the contract, and the deal was cancelled.


However, in July, the Government of Cameroon announced a list of 10 companies that had prequalified to take up the concession, and this list was whittled down to five in September. The five are the Port of Antwerp, South Africa’s Coega Development Corporation with Transnet, ICTSI, Marsa Maroc with AIIF3, and Medlog with Wide Resources Ltd. A final operator will now be chosen, and must take up the concession by July 2020.


The first berth at Kribi container terminal began operations in March under an operating consortium of CMA CGM, Bolloré and CHEC. The Chinese firm built the 1M TEU/year facility with a US$500M loan from China’s Exim Bank.

 

The Chinese bank has provided another US$600M to the overall Kribi project, including the construction of the multipurpose terminal at a port that was originally developed solely as an oil terminal.

 

CHEC is also building a US$453M road to give the Cameroonian capital of The NPA’s Hadiza Bala-Usman is determined to get Lekki rail-connected Yaoundé access to the port. Once completed, the port as a whole will have 20 berths. As well as serving Cameroonian trade, Kribi is being developed as the main port for Chad and the Central African Republic, and it is also hoped that it can capture a significant slice of transhipment business in the Gulf of Guinea.

 

 

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