Having signed a 30-year lease agreement, Petrochem will invest between $80 million and $90 million in the facility on Quay 7, adjacent to the port’s dedicated chemical handling berth. It is planning to build 24-30 bulk chemical storage tanks of various sizes ranging from small to large, as well as some stainless-steel tanks, with an overall peak capacity of 40,000 cubic meters.

The facility will be fitted with distillation and processing units. It will also include a day tank farm, tanker and truck loading capabilities, a nitrogen generation plant and automatic drum filling machines. Work is due to be completed by the third quarter of 2023.

Petrochem has been a part of the Jebel Ali Free Zone (Jafza) since its inception in 1995, and the new terminal will be the company’s second at the site. Yogesh Mehta, Petrochem’s CEO, said Jafza has helped the company position itself as the largest independent chemical distributor in the Middle East and the 11^th largest in the world. He added that he is expecting short-term and long-term gains of between 10-15% of Petrochem’s investment.

The port currently supports more than 10,000 chemical producers and traders, and the free zone has a petrochemical cluster housing more than 500 petrochemical companies. The port has container terminals, a liquid bulk terminal and 11 berths. According to Petrochem, the new chemical terminal is likely to contribute annually to upwards of $200 million of new trade to and from Dubai.

“The UAE and the Middle East region for years have been recognized 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 (Gulf Cooperation Council) chemical output expanded by 1.5% compared to a global decline of 2.6%. These figures showcase the resilience of the sector and the potential it has,” said Abdulla Bin Damithan, CEO & managing director, DP World - UAE Region and Jafza. He added that due to its location, Jafza is a strategic access point to the Middle East, Africa and South Asia, contributing around 70% of the UAE's foreign trade in petrochemical products.

Author: Elaine Burridge, Freelance Journalist