Dubai: DP World, UAE Region and Petrochem Middle East, the largest chemical distributor in the Middle East and Africa, have signed a 30-year lease agreement that expands its business in the region.
Petrochem Middle East will invest between $80 million to $90 million in developing a chemical terminal on Quay 7, adjacent to the dedicated chemical handling berth within Jebel Ali Port.
The agreement was signed by Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World and Yogesh Mehta, CEO, Petrochem Middle East, in the presence of Abdulla Bin Damithan, CEO & Managing Director, DP World - UAE Region and Jafza.
“The UAE and the Middle East region for years have been recognised as a thriving hub for the petrochemical industry. Despite the highly unstable market due to the pandemic, over the course of 2020, the GCC’s chemical output expanded by 1.5 per cent compared to a global decline of 2.6 per cent,” said Abdulla Bin Damithan, CEO & Managing Director, DP World - UAE Region and Jafza.
Serving regional industry
DP World, UAE Region’s trade and logistics hub including Jebel Ali Port and Jebel Ali Free Zone (Jafza), has contributed for years to the region’s chemicals’ trade and logistics with its state-of-the-art ecosystem. While the port supports more than 10,000 chemical manufacturers and traders, the free zone has a petrochemical cluster that spreads over an area of four million sqm, housing over 500 petrochemical companies that employ over 6,500 people. In addition to container terminals with 22.4 million TEU capacity, the Jebel Ali port that has 11 berths, also features a liquid bulk terminal, spread across two million sqm.
A mega facility
The facility is expected to be completed by the third quarter of 2023 and will provide chemical raw materials in large volumes to traditional and new industries coming in the UAE. In its peak capacity, the terminal will have a capacity of approximately 40,000 CBM for storage of various products and will also be fitted with distillation and processing units. It is likely to contribute annually to upwards of $200 million of new trade to and from Dubai thereby contributing to the DP World Trade Bridges and the 2 trillion project.
“Since our inception in Jafza, we have had the privilege of having an ideal business environment that has truly added to our growth figures. Today, our annual turnover is over Dh2.5 billion and with the new project, we are expecting short term and long-term gains of about 10-15 per cent of our investment,” said Yogesh Mehta, CEO, Petrochem Middle East.
Petrochem Middle East has been a part of Jafza since its inception in 1995. This is the second distribution and storage terminal in Jebel Ali and the fifth in the world. With this project, Petrochem proposes to build 24-30 bulk chemicals storage tanks of different size large and small and some stainless-steel tanks with an overall capacity of 40,000 m3. It also includes a day tank farm, tanker and truck loading facility, nitrogen generation plant and automatic drum filling machines.