Abu Dhabi Ports Signs New Partnership Agreement with Karachi Port Trust

Abu Dhabi Ports Group has announced the signing of a new 25-year licensing agreement with Karachi Port Trust, a subsidiary of the federal government of Pakistan, to develop, operate, and manage a general and bulk cargo terminal at Karachi Port.

Under the licensing agreement, a joint venture named “Karachi Gateway Terminal Limited” will be established, with Abu Dhabi Ports Group as the majority shareholder and KPT subsidiary “Kahil Terminals” based in the UAE, to develop, operate, and manage a general and bulk cargo terminal at berths 11-17 located in the eastern pier of Karachi Port, enhancing Karachi’s position as a major player in the maritime sector.

This agreement follows Abu Dhabi Ports Group’s signing of a licensing agreement in June 2023 to develop, operate, and manage a container terminal at berths 6-10 in the eastern pier of Karachi Port.

In addition to an 800-meter long quay wall on the eastern side designated for the container terminal, the new concession agreement allows the joint project to develop a 1,500-meter long quay wall for handling general and bulk cargo adjacent to the container terminal.

This gives the joint project full operational control over the eastern quay of Karachi port, with a primary focus on handling general cargo such as iron, paper, and cement, as well as bulk cargo such as grains and fertilizers. The joint project, “Karachi Gateway Multimodal Limited,” plans to invest approximately $75 million in the first two years, covering initial fees, advance payments, infrastructure investments, and equipment, followed by an additional investment of $100 million over five years to enhance the efficiency and increase the capacity of the terminal by 75%, enabling it to handle 14 million tons annually in the future.

As part of this agreement, the joint project will be responsible for carrying out operations on the east pier, ensuring immediate cumulative revenues upon completion of the deal.

It should be noted that the bulk and general cargo station conducts all transactions in dollars. The current station, which handles around eight million tons annually, is expected to generate revenues of approximately $30 million and profits before interest, taxes, depreciation, and amortization (EBITDA) of about $10 million annually in the short term. These revenues are also expected to grow in the medium term with the completion of the station’s upgrade and increased capacity.

On this occasion, Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade, said: “This agreement is an extension of the strong ties between the UAE and Pakistan, and reflects the UAE’s direction towards further openness to the world in terms of trade and investment, expanding the state’s network of trading partners, and establishing new trade routes connecting different parts of the world.”

Al Zeyoudi added: “This agreement also reflects the shared vision of the two friendly countries regarding the importance of enhancing and strengthening the maritime sector’s capabilities to serve development goals.

We look forward to continuing to work with the Pakistani side to drive growth in the business sector, open new opportunities for trade, investment, and economic development, in line with our wise leadership’s vision to achieve progress and prosperity.”

Captain Mohammed Juma Al Shamsi, the Deputy Director and CEO of Abu Dhabi Ports Group, stated, “With the expansion of our collaboration with the Karachi Port Trust and our investment in the main sea trade routes of the United Arab Emirates, we reaffirm Abu Dhabi Ports Group’s commitment to enhancing the regional connectivity network.

Through this agreement, we look forward to elevating Karachi’s status as a vital hub and gateway for global trade, relying on modern infrastructure and innovative digital solutions. Furthermore, we will continue to work under our wise leadership’s approach to establish strategic partnerships that contribute to achieving economic diversification.”