Cosco-led investors to expand Qingdao port

Cosco Pacific, AP Moller-Maersk Group and two other investors will spend a total of US$1 billion on a port expansion project in Qingdao in a bid to cope with strong market demand.

A new joint venture, the Qingdao New Qianwan Container Terminal, was set up yesterday to build 10 berths in the extension of Qianwan Container Terminal, the fourth-largest container port in the mainland.

Shareholders in the existing port, including Cosco Pacific, Qingdao Port Group and Maersk will own 80 per cent of the new company while Pan Asia International Shipping will have the remaining 20 per cent, Cosco Pacific said in a press statement.

Cosco Pacific, the port division of China Cosco Holdings, has agreed to pay US$160 million for a 16 per cent stake in the new port project.

Qianwan Container Terminal is a major port in Qingdao, the busiest port city in the Bohai-Rim region in the northeast mainland. In January, DP World China (Qingdao) obtained approval from Beijing to build four container berths in Qianwan's south bay for 3.47 billion yuan.

The 10 new berths will be constructed in the south bay of Qianwan Container Terminal with a total quay length of 3,400 metres and depth alongside of 17 metres. The designed capacity of the facility is six million 20-foot equivalent units (teu) per year.

Some new berths are already under construction and four are expected to commence operation by the end of next year. Together with the 11 old berths, the port will be able to handle 12.5 million teu per year upon completion.