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Saudi Maritime Forum 2010 31 May 2010

Saudi Maritime Forum 2010 31 May 2010. 2008 - A Vision & A Promise Shared. To build a world–class container terminal at Jeddah Islamic port (JIP)

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Saudi Maritime Forum 2010 31 May 2010

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  1. Saudi Maritime Forum 2010 31 May 2010

  2. 2008 - A Vision & A Promise Shared • To build a world–class container terminal at Jeddah Islamic port (JIP) • The new terminal would be equipped with the most modern, state of art port facilities allowing JIP to compete with the top largest ports in the world • By Q4 2009 RSGT would be Operational

  3. “Redefining Standards of the Industry In KSA” • RSGT envisioned the growth of Jeddah and the necessitate to provide extra capacity • Demand for an integrated logistics hub to serve the Red Sea region • To Enhance standards to Enhance trade • Anticipated Jeddah’s need for expansion…

  4. Building Capacity, Raising Capabilities • Capacity Building • 1.8 million TEU • Capability Enhancements • Quay draft 18 m – Serve next generation vessels • Dedicated navigation channel • Separate feeder berth • 10 SPP quay cranes with 40’ dual lift capability • Integrated Logistics Hub • Bonded & Re-export zone under same management • Intermodal Connectivity

  5. 22nd December, 2009Start of Commercial Operations Promise Kept

  6. Summary of RSGT Milestones • Channel Handover • Phase 1 & Start of commercial Operation • 2 QCs & 8RTGs delivered • Channel dredging completed • 10 RTGs delivered • 4QCs & 2 RTGs delivered • RSGT Fully Functional • Jan 2008 Aug 2008 • Nov 2007 • Dec 2006 • Channel dredging started • Concession Agreement with Port Authority • Civil works & Equipments Contract • Commencement of civil works Jun 2009 Aug 2009 Sept 2009 Oct 2009 Q3 2010 Dec 2009 22 Dec 2009

  7. Overview of JIP Enhancements

  8. Operational Phases

  9. Weathering the storm 2010 & Beyond

  10. Beyond AnnusHorribilis • It was the year the World Economy suffered the worst recession since the Great Depression, with the container trade being the hardest hit! • The sharp decline in world trade resulted in a slump not seen in the shipping industry for a long time • Although still too early to cheer, a form of recovery is there * Source: IMF

  11. Region Bucks the Global Recession • Middle East & Red Sea regions have overall bucked the global economic recession • Impact of the crisis on container volume has been relatively limited, with modest drop in 2009 and quick bounce in 2010 • More stable volume growth in Middle East region * Source: IMF * Source: Drewry

  12. Reaction by Shipping Line • Cut capacity in main trade route and still cautious to push too much capacity not to jeopardize recovering freight • However, vessel size is being upsized. 8000+ class ships are deployed mainly in Asia-Europe trade route -28% +17% -19% -36% -33% * Source: Drewry * Source: Drewry

  13. Still Large Number of 7500+ TEU to Come • In spite of cancellation and delay of some order, still large number of new vessels to be launched in market, dominantly 7500+ class ships. * Source: Alphaliner 5% 32% 61% 40% 49% 29% 66% 34% 61%

  14. More than 150 vessels of over 10,000TEU class will be introduced in the market by 2013  Minimum 16m draft / 22 rows out reach crane is required  New paradigm for container terminal in facility and operational efficiency What Shall Jeddah Port Do? • Current biggest vessel calling Jeddah:8,400TEU class • Future Vessel calling Jeddah: 13,000TEU

  15. Continue to be ahead of trend in capacity & capability…….Achieved by RSGT Continue to improve road network connecting the port Having competitive edge in intermodal …… Saudi Land Bridge Build utmost efficiency in workflows, procedures & policies of government agencies, eg. Saudi EDI, customs, etc What Shall Jeddah Port Do?

  16. Oversupply?

  17. Red Sea Ports Supply & Demand • Oversupply from 2010 onwards due to massive expansion of major ports. Utilization % *Red Sea ports: Jeddah, Salalah, Aqaba, Sokhna, Aden, Djibouti, Port Sudan, Hodeida

  18. Saudi Arabia 2010 Positive Overtures Saudi economy demonstrated far greater resilience compared to many of the G20 nations • GDP grew 0.15% in 2009 with 3.9% and 4.8% predicted in 2010 and 2011 respectively • Government approved $146 billion 2010 ‘stimulus ‘budget (up 3.7% on 2009 ), with $70 billion toward investments also a16% increase • $400 billion to be spent over next five years on infrastructure - the largest stimulus package in the Group of 20 nations • Financial institutes are easing their purse strings! • Private sector lending up in April, rising 0.65% from last month to over $20 billion the highest level this year so far • Interest rates to remain unchanged • Oil prices around $70 mark from its lowest $32 (2008) 2010 will be a recovery year for the Saudi economy, based on high government spending.

  19. Drive for Export - Petrochemical Cargo • Container volume generation by petrochemical & polymer production: 1.0 M TEUs a year by 2011 Production: 8.9 million metric tonnes TEU’s Generated: 600,000TEU Production: 6.2 million metric tonnes TEU’s Generated: 400,000TEU • AL-Sharq Ethylene • APCC • SAUDI KAYAN • ALWAHA Petrochemical Complex • KEMYA • NCP • Tasnee/Bassell JV • NATPET • PETRO RABIGH • YANPET • YANSAB

  20. Jeddah Outlook • Jeddah is maintaining more solid growth in local volume than other ports • 2010 volume will exceed 2008 record high • Bolstered by economy as well as new terminal capacity and enhanced efficiency, transshipment will bounce back

  21. Jeddah Supply & Demand Utilization %

  22. Driving Competition • Oversupply will be a key challenge in the short term • Ports and terminals need to overcome with a competitive edge to stay in the game • Operational efficiency, optimal cargo movement and increased capability are clearly going to be a game-definers in the terminal industry

  23. Thank you Red Sea Gateway Terminal Redefining Standards

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