By Derek Alberts
(Bloomberg) — The South African port of Durban has started an excavation project to triple its capacity to handle large container ships, encouraging more vessels to sail around the Cape of Good Hope, rather than use the Suez Canal.
Global maritime traffic is increasingly dominated by large vessels that need to be serviced at specialized deep ports, Mark Gregg-MacDonald, an executive at state transport company Transnet SOC Ltd., told reporters in Durban on Friday. The city is South Africa’s third-largest and has its busiest harbor.
“It’s more cost effective to sail modern, large container vessels around the Cape than through the Suez Canal,” Gregg- MacDonald said.
Work on the project, known as dig out port in Durban, started in 2012 and the first phase is due to be completed by 2025. Project Director Marc Descoins said it will take the port’s capacity to 9.5 million twenty-foot equivalent units in 2040, from 2.7 million last year.
The port expansion will contribute at least 16.5 billion rand ($1.4 billion) to the South African economy, Gregg- MacDonald said.
“More than 70 percent of all container ships currently being built are larger than 8,000 TEUs, a far cry from five, 10 years ago,” Gregg-MacDonald said.
Descoins declined to give an estimate for the cost of the project, saying unforeseen events and potential delays make forecasts “a lottery.” Spending so far had reached about 150 million rand, he said.
Copyright 2015 Bloomberg.