Opening a fourth berth on the north side of the Thames at London Gateway next month will be the start of a fierce maritime battle with Felixstowe for Britain’s top port.
London Gateway, in a fight that pits the industrial and financial might of Dubai against the Hong Kong billionaire Li Kashing, will expand its quayside capability on land reclaimed by the estuary of wastelands in south Essex by more than one mile. With 16 cranes as high as the London Eye in place at London Gateway, the company will be able to accommodate four 400-metre-long ultra-large containers ships at once, should the need arise.
The addition of a 4th berth to London Gateway, which was opened a decade earlier and is owned and funded Dubai Ports World will allow it to compete with Felixstowe in Suffolk, located 70 miles away, and owned by Li’s Hutchison Ports. It aims to steal customers, volumes, and market share from Felixstowe.
Dubai Ports World is considering adding a 400-metre fifth dock at London Gateway if the economic and business case for it makes sense. This could be the final push to surpass Felixstowe.
“We expect the competition to be overtaken within five years,” said Ernst Schulze. The chief executive of DP World UK Ports & Terminals (which includes Southampton) confirmed that the new London Gateway berth would go into operation in August, and will be fully operational at the end of the year.
London Gateway has a capacity of 2.4 million teu per year. A teu is the industry standard container measurement for a 20-foot equivalent.
Schulze stated that the addition of a fourth berth, at a cost additional £350 million, on top of £2 billion already invested in the facility, and London Gateway’s ability to service larger container ships would result in its annual capacity increasing by 35 percentage points, to 40%, adding another 1,000,000 teu per year.
While Boris Johnson’s boosterism claimed that the UK after Brexit would be a “Singapore-on-Thames” free trading outpost off the coast of Europe, the reality is that a Jebel Ali-on-Thames was already under way as DP World sought to recreate Dubai’s giant integrated port in the UK.
London Gateway has built a logistics park adjacent to the inland. It is now a growing weapon for London Gateway. It has a potential of 9.25 million square feet of warehouse space, and is already over half full. The park includes 14 large sheds for perishable foods, such as chilled storage, banana ripening, and electrical and fast moving consumer goods. Hangars are filled with alcohol imported from all over the world, and bonded warehouses for items that need to be stored for VAT and import duties.
The logistics park is the largest in Britain, and it aims to become the largest in Europe. The logistics park employs 1,500 workers, on top of 880 people in the port. London Gateway’s bid to become the center of the Thames Freeport will, according to Schulze, eventually attract light industrial units that enjoy tax incentives to the logistics park.
Schulze stated that the need for a larger London Gateway is self-evident. “Britain requires more port capacity, and in particular the infrastructure of quays, cranes and quays that can handle even the largest vessels. We have land at London Gateway for expansion.
London Gateway has land available for expansion
“We also learned from the pandemic, that we need resilience to build just-in time supply chains.” He said.
He said that growth would come not only from UK ports, but also those in Europe across the English Channel, North Sea, and the global shift to containerisation of goods, and from growth in the British Economy.
Schulze explained that “the UK is an import-based economy.” He said one-third of the perishable goods and food are produced in-house, while a third come from European roll-on/roll-off cargo vessels, and another third from South America Africa Australasia, and the Mediterranean. London Gateway claims that it accounts for 75% of this latter.
Felixstowe is ready to fight. The port declined comment on its current annual throughput – it’s best years were the last decade with 4.2 million teu – but confirmed that it has greater capacity and volume than London Gateway.
Since the days of Sir Walter Raleigh, Sir Francis Drake and Samuel Pepys in the 17th Century, boats have docked at Shell Haven.
Shell had strategic facilities there in the early 20th century, even though it is a coincidence that the two names are the same.
Shell closed its refinery in Coryton, a few miles to the east of London’s historic docks. The refinery was also located downstream from the Port of Tilbury. Shell’s operations were shut down by 1999.
The maritime group P&O acquired the Shell Haven property at the turn of millennium with an ambitious plan for redevelopment as a major port and logistics park. Dubai Ports World acquired P&O in 2006 and inherited these plans. It received outline planning permission one year later.
London Gateway was opened at the end of 2013 after reclaiming a quarter-mile of land on the Thames for its new quays. The river must be continuously dredged to maintain the 17 metre draught, or depth of water required to accommodate the largest container ships.
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