AD Ports Group, a government-owned maritime and logistics provider in the United Arab Emirates, announced on Thursday the signing of a 50-year concession agreement with Karachi Port Trust (KPT) to manage the Karachi Gateway Terminal Limited (KGTL).
The agreement calls for the formation of a Joint Venture (JV) between AD Ports Group and Kaheel Terminals.
Over the first ten years, AD Ports will be the dominant shareholder, investing $220 million in new concession and growth CapEx. Meanwhile, Kaheel is a firm located in the UAE that was founded to manage, operate, and expand KGTL at berths 6 to 9 on Karachi Port’s East Wharf.
“The JV will invest significantly in infrastructure and superstructure over the next ten years, with the majority of it planned for 2026,” according to a release.
“The development works will include the deepening of berths, the extension of quay walls, and an increase in the container storage area.”
“As a result, the terminal will be able to handle Post Panamax class vessels of up to 8,500 TEUs (Twenty-Foot Equivalent Units),” according to the release. “Container capacity will increase from 750,000 to 1 million TEUs per year.”
The terminal’s operations are fully dollarized, with no foreign currency exposure to the Pakistani Rupee, according to the statement. Historically, the terminal has generated roughly $55 million in revenue and EBITDA of around $30 million per year, according to the company.
“This agreement has the potential to usher in a new era of growth and progress for the UAE and Pakistan,” said Captain Mohamed Juma Al Shamisi, Managing Director and Group CEO of AD Ports Group.
According to Al Sahmisi, the pact would enhance links with important trading nations, resulting in increased economic growth and prosperity.
Meanwhile, Pakistan’s Minister for Maritime Affairs, Faisal Subzwari, stated, “The signing of this agreement underscores both our great nation’s shared vision for port infrastructure development and sets the stage for a prosperous global maritime ecosystem.”
AD Ports Group signed a Memorandum of Understanding (MoU) with the KPT last month.
The Memorandum of Understanding covered a wide range of programmes and projects targeted at improving port infrastructure, improving operating efficiencies, and embracing digitalization.