MegaProject 1236: DP World wins US$1 billion port project in DRC
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DP World has won a 30-year concession with an option of a further 20-year extension for the development and management of a greenfield multi-purpose port at Banana, in the Bas-Congo province of the Democratic Republic of the Congo (DRC). The Port of Banana will be the first deep-sea port in the country.
DP World will set up a joint venture with the government of DRC to manage and invest in the project, with ownership stakes of 70% and 30%, respectively. The total project cost is expected to be more than US$1 billion.
The company initially signed an agreement with the DRC's Transport Ministry in February 2017 which gave it exclusive rights to negotiate a contract to build and operate a port at Banana.
The port will be delivered in four phases. The first phase will include a 600-metre quay and 25-hectare yard extension with a container capacity of 350,000 TEU (twenty-foot equivalent units) and 1.5 million tonnes for general cargo. Construction is expected to start in 2018 and take approximately 24 months to complete.
The estimated initial investment of this first phase is US$350 million and will be spread over 24 months.
Despite the Democratic Republic of the Congo being Africa’s third-most populous country, it has no direct deep-sea port. Though there is the riverine port of Matadi, the majority of its cargo is still handled by neighbouring countries. Thus, the Port of Banana is expected to generate significant cost and time savings in trade.
The project will connect the DRC to global trade lanes, enabling the country to access a wide range of global markets and reduce its dependency on the neighbouring countries’ ports.
DP World expects that the port will attract more direct calls from larger vessels from Asia and Europe, and ultimately catalyse national and regional economic growth, as well as deliver attractive returns to shareholders over the longer-term.