Dubai: DP World to delay Jebel Ali port expansion
The company had announced in July 2015 that it would invest $1.6bn in Terminal 4, which was to be completed by 2018
UAE-based ports operator DP World is delaying the expansion of Dubai's Jebel Ali port, its main facility, because of "softer market conditions", the company said in a statement.
A plan to add 1.5 million twenty-foot equivalent units (TEU) of capacity to Terminal 3 at Jebel Ali will be delayed into 2017, while expansion of Terminal 4 will also be slowed, DP World said without giving details.
The company had announced in July 2015 that it would invest $1.6bn in Terminal 4, which was to be completed by 2018. Jebel Ali handles shipments not only for the UAE but for much of the region.
Since last year, however, growth in the oil-rich economies of the Gulf has slowed because of low oil prices.
"(The) global trade environment remains challenging including for Jebel Ali port," DP World said, adding that the company handled 7.4 million TEUs of cargo in the UAE during the first half of 2016, down 6% from a year ago.
DP World had previously disclosed that its consolidated throughput for the first half - volumes at ports which DP World controls around the world - was 14.6 million TEUs, down 1.4%.
Also DP World reported a 50% jump in net profit attributable to shareholders during the first half to $608m, helped by the acquisitions of Dubai's Jebel Ali Free Zone and Canada's Fairview Terminal.
DP World's revenue for the first half was $2.09bn, up from $1.9bn a year earlier.