Fujairah port thrives on growing tanker traffic

FUJAIRAH // The decline in global trade is bringing down international shipping with it. Yet Captain Mousa Murad cannot help but revel in the prospects for Fujairah. As activity slows at neighbouring Jebel Ali and other ports in the region, possibly forcing them to scale back once ambitious expansion plans, he says he barely has enough space in his port to accommodate any more tankers. And soon, half of Abu Dhabi's oil exports will be flowing through its port, bringing with it dozens of new businesses and thousands of employees looking for their share of the spoils. "It's very exciting," says Capt Murad, 58, the general manager of the Port of Fujairah. "We're seeing new companies and employees coming in, which, as you can imagine, will have a major impact on Fujairah." The port has made a name for itself as a refuelling hub for the world's shipping industry. Vessels on their way to pick up cargoes of oil from Kuwait, for example, or textiles from India, often stop off in Fujairah for services. After Singapore, it is the world's largest refuelling destination. While Fujairah has suffered from the environmental impact of the port, it has become an integral part of the economy, says Capt Murad, who is confident it will bring great benefits to the northern emirate. "It will be an indirect benefit, of course, but it will be a major indirect benefit," he says. Roughly 10,000 vessels passed through the port last year, he estimates, and its services have come under more demand despite depressed oil prices. Although he has noticed a significant slowdown in the export of gravel, a major commodity in the emirate, a growing number of empty oil tankers have chosen Fujairah's anchorage area as a base to wait for orders to pick up deliveries, keeping the 150-plus companies that provide ship services there busy. "Ships still require food, supplies, and they need to refuel, and we offer those services, so that's why the number of ships is increasing," says Capt Murad. "I can tell you that business is okay for me, but it's not just me. It's the bunkering companies, supply companies, they're doing very well." It was long thought that the port's anchorage facilities could accommodate 120 vessels at any one time, he says, but recently port employees were surprised to discover that about 150 vessels were waiting in the area. "It used to be that the our anchorage area was free for boats," he said. "But because their numbers increased, we decided to offer them two months free anchorage. But the number increased even more, so we gave one month free, and still it increased. Now we give 10 days free." Part of the reason for the port's growth over the past decade, Capt Murad says, is due to its naturally deep waters. Sixty-thousand-tonne and far heavier vessels can be seen casually waiting several kilometres offshore, forming a seemingly endless constellation of boats that, at night, can easily be mistaken for a landmass. "It's hugely deep out there, which allows us to handle the big ones," he says. But perhaps the decisive factor is Fujairah's location. It is the only emirate with direct access to the Indian ocean, allowing vessels access to a UAE port while bypassing the Arabian Gulf and its tortuously narrow entryway, the 54 km-wide Strait of Hormuz, which neighbouring Iran has suggested it could forcibly shut if provoked by the US or its regional ally, Israel. Observers have noted that vessels parked in Fujairah are offered lower insurance premiums, given that the area is situated just beyond the Strait. Yet, they are still close enough for tankers to quickly descend on ports of oil-producing nations in the Arabian Gulf. Next year's expected completion of the International Petroleum Investment Company pipeline, predicted to be a major boon to the emirate's economy, appears to signify the Government's desire to use Fujariah as a strategic hub. Winding 320km from Abu Dhabi's Habshan oil fields to Fujairah, it will pump an estimated 1.5 million barrels of oil a day and bring with it unprecedented opportunities for the emirate. In September, the port took out a Dh900 million (US$245m) syndicated loan to help fund expansion at the port, part of it related to the pipeline project. Few details of the pipeline project have been made public, but millions of tonnes worth of new refining and oil storage facilities are being built. Dozens of lorries can be seen on the emirate's coastal road, with hundreds of workers involved in building massive oil-related silos for such companies as Vopak Horizon Fujairah. The expansion also presents environmental challenges that Capt Murad said must be addressed. The port has become the bane of environmental activists and many in the hotel industry, who say officials have not done enough to stop passing vessels from illegally dumping oil into the sea. Oil has continually washed up on local beaches, damaging tourism and, as environmentalists have warned, poisoning the area's delicate aquatic life. "We may need some federal assistance, but we need to address this issue because we can't let these spills continue to happen," Capt Murad says. "They're very bad for us, and the people are suffering because of this." Also as a "tourism destination, we realise we have to tackle this issue," he says. Though he declines to give specifics, he says port authorities have been in discussions to find a comprehensive plan to tackle the spills, possibly involving satellites and monitoring aircraft that are shared by GCC countries. "This is a project I'm working on," he says. "We are making plans with the federal Government and the municipality, and we are consulting the Europeans." [e-mail]