Handle with care: Expansion of port capacity will ease cargo handling on both of the kingdom’s coasts

Port infrastructure in Morocco has been benefitting from upgrade work for several years now. In 2014 the total cargo traffic passing through the kingdom’s ports reached some 115.1m tonnes, up from 92.3m tonnes in 2012. Much of this increase was the result of a new, overarching development plan, the Port Strategy 2030, which was put together by transport authorities in 2010 to map out the country’s needs. The plan established that over the following two decades, a total investment of up to Dh74.9bn (€8.1m) will be needed to make the necessary expansion work on the kingdom’s main 17 ports. Financing for the upgrades is expected to come from a combination of public and private sources.

As part of this, the National Ports Agency (Agence Nationale des Ports, ANP), a public commercial entity established under the Ministry of Transport, Equipment and Logistics in charge of overseeing all the ports in the country (except for Tanger Med) has set aside a Dh6.3bn (€685.4m) budget to be spent on renovating existing ports as well as new ports for the 2014-18 period. Up to Dh1.8bn (€195.8m) of that financing envelope was allocated for 2014 alone.

However, in line with the more constrictive budgeting framework the government is operating with, role in future development. The minister of transport, equipment and logistics, Aziz Rabbah, told local media that the investment model for port development needs to switch from a state-based to a public-private partnership models, in which a growing number of private actors take a role in operating port structures, bringing both managerial skills as well as the necessary financing into new infrastructure.

IMPROVING THE LAW: Over the past decade, reform has set the stage for private participation in the sector to increase. In 2006 the government published Law 15-02, which eased the transfer of maritime services into the hands of private companies, followed by the establishment of the Tanger Med port in 2007. Morocco’s largest trans-shipment facility – which in 2014 experienced a 17% rise in handled cargo volumes to 41.7m tonnes – is administered by the Tanger Med Port Authority (TMPA). The TMPA is itself overseen by the Tanger Med Special Agency, which was established as a private-public partnership.

INFRASTRUCTURE EXPANSION: Rising cargo tonnage is being supported by improvements to the kingdom’s port facilities and supporting infrastructure. In addition to extending the existent installed capacity, Morocco’s port strategy also underlines the positioning of each port according to the economic activities surrounding them, thus grouping the ports into clusters that are adapted to the specific needs of the regions they serve. While the ports of Jorf Lasfar and Safi, for example, located on the central Atlantic coast, have established themselves as important energy centres, with links through which to move the country’s important phosphate exports, Casablanca Port is geared towards the handling of domestic containerised cargo.

The port of Casablanca remains the kingdom’s biggest port in terms of transported cargo, accounting for 29.7% of traffic (excluding trans-shipment) in 2014, according to the ANP. The handled cargo of the facility has been growing steadily, expanding 11% in 2014, but the port’s location within the city has long limited growth possibilities.

Run by the local port operator Marsa Maroc, the port includes two container terminals with a combined capacity for 650,000 twenty-foot equivalent units (TEUs) per year. In 2012 the company won the concession to build and operate a third container terminal, TC3, which will raise annual capacity to 1.3m TEUs. Construction of the new terminal, predicted to cost Dh640m (€70m), will include 530-metre quays and a depth of up to 14 metres, as well as a 30-ha handling area. The new structure is set to be operational by the summer of 2016, and help avoid concession over the near future.

POWERFUL NICHE: Further south, work on the relocation and expansion of the Safi Port was launched in mid-2013 and aims to give the energy-focused facility a revamp. The project will be divided into three different sections, the first of which is expected to mobilise an investment of up to Dh4bn.

Development of the port, at least in its initial stages, will focus on serving the needs of OCP S.A., which was formerly the state-owned organisation known as Office Chérifien des Phosphates, and the National Office of Electricity and Potable Water (Office Nationale de L’Electricité et de L’Eau Potable, ONEE), Morocco’s state-owned utility, both of which have large facilities nearby.

The first phase of the project is set to be completed by 2017 and will allow for ONEE to bring in its coal imports to fuel a new thermo-electric power plant, currently under construction in Safi. The plant is expected to require approximately 3.5m tonnes of coal per year. OCP S.A. on the other hand, will use the new port both in order to import materials as well as to export some portion of its phosphate production. The new port will be linked to a nearby industrial phosphate complex, which is being implemented at an investment of about Dh30bn (€3.3bn).

The new port facilities will be built near the existing port, which will be transformed into a mixed-use development including a pleasure boat marina.

GO EAST: Much is also expected from the government’s plans to establish a new port along the Mediterranean coast, close to Nador, in Morocco’s Oriental region. The first phase of the Nador West Med project is budgeted at approximately Dh10bn (€1.1bn) and 13 international companies pre-qualified for the tender in February 2015. The Moroccan authorities are expected to announce the winning bidder for the construction of the port during the second semester of 2015.

The management model for the new structure is expected to be similar to Tanger Med to the west, but on a smaller scale and focused on bulk cargo for the energy industrial sectors. The plan envisions the creation of a port and associated industrial area. It will include a container terminal, a 1500-ha tax-free zone, a coal terminal with a capacity of 7m to 8m tonnes, and new hydrocarbons stockage capacity of between 40m and 50m tonnes.

The new port in Nador is closely linked to the country’s energy production plans. With ONEE expanding an existing coal-fuelled thermal plant in Jerada, close to the Algerian border, the new structure will ease coal imports. Another possibility might be to use the port for liquefied natural gas imports.

From the initial investment of about Dh10bn (€1.1bn), as much as Dh4.6bn (€500.5m) is expected to be financed by Morocco. The kingdom will put down Dh2.2bn (€239.4m) for the project, with the other major backers, such as the National Ports Agency, the Tangier Mediterranean Special Agency and the Hassan II Fund also contributing much-needed financing. Société Nador West Med, which is poised to oversee the construction and running of the port, is also aiming to get loans from multinational financial bodies such as the African Development Bank, the European Bank for Investment and the Arab Fund for Economic & Social Development.