Mozambique to invest US$290 million in Beira port

The government of Mozambique has approved additional investment of US$290 million in the port of Beira, to increase its cargo handling capacity.

The Council of Ministers has authorised port concessionaire CdM to invest the money for operation, maintenance, management, ownership and restitution of existing infrastructure of Pier 2, 3, 4, 5, 6, 7, 9 and 10. They handle containers and general cargo, excluding bulk liquids and coal.

The money will also be used to increase the capacity and expansion of existing piers and parks, terminals and/or rear areas, warehouses and other infrastructure related to the piers.

To enable CdM to recover these additional investments, the government decree extends the date of completion of the initial concession contract, scheduled for July 15th 2023, for a further 15 years, until July 15th, 2038.

CdM will hold right of first refusal on all agreements to be concluded between the granting authority and CFM and third parties in the area of jurisdiction of the port of Beira. This includes transfer, for the purposes of development and commercial exploration, of any other port infrastructure similar to the port´s cargo handling area.

The announcement was made by the Council of Ministers in a decree made available to CL Brief by legal database LegisPALOP+TL. It is Decree 43/2018, which entered into force on October 9.

It approved the terms of the addendum to the concession agreement concluded in 1998 between Cornelder de Moçambique (CdM), subsidiary of Cornelder Holland, Sa, and the ports and Railways of Mozambique, E.P (CFM), as Granting Authority for the Government of Mozambique, for management and exploitation of Pier 2, 3, 4 and 5 (Multipurpose Container Terminal) and Pier 6, 7, 9 and 10 (General Cargo Terminal).

Mozambique´s economy is gaining international attention because of massive natural gas reserves. Exports are due to begin in four to five years’ time. The transport and logistics sectors are attracting sizeable investment.

The additional investments at Beira aim to increase the capacity of the container terminal, including the construction of new access infrastructures; rehabilitation and expansion of the storage park; increase in handling capacity of Pier 2 to 5; and acquisition and modernization of equipment handling.

They also aim to increase the capacity of the general cargo terminal, including construction of new access infrastructures; rehabilitation and expansion of the storage park; construction of dedicated terminals at the rear of the piers. Also part of the investment is multi-use infrastructure for cargo bulk and unitized cargo, as well as increasing dock handling capacity in 6, 7, 9 and 10 pier; acquisition and modernisation of handling equipment; and investments in computerized systems of operational management and port security.

The total investment will allow Beira port to manage 700,000 containers a year, almost double the current capacity and the equivalent of 750,000 to 1.2 million tons.

The agreement also includes reconstruction work by Cornelder in the EN 6 road from Beira to the border village with Zimbabwe at Machipanda. This aims to reduce by one third the journey time from Zimbabwe to Beira, from six to four hours.

Beira is one of the main ports of Mozambique. It is located in Sofala Province and is a better location than the ports of Durban and Dar-Es-Salaam as it is closer to Zimbabwe, Zambia, Malawi and the Democratic Republic of Congo.

The port comprises 12 piers. CdM manages the container, multiple purpose and general cargo terminals, from Pier 2 to 10, except Pier 8, which is dedicated to coal). It concentrates on handling, storing and weighing domestic and international cargo. The container and multiple purpose terminal of Beira has a paved area of 213,000 square meters.

Internal studies forecast an 83% growth in traffic over the next 35 years.

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