Port of NEOM strives to redefine sustainability, operations optimization 

NEOM, Saudi Arabia’s US$500 billion megaproject to set a new standard of urban living in the northwest of the Kingdom, recently opened its port in May 2023. It is part of Saudi Ports Authority’s plans to transform local ports into globally competitive logistics hubs. Located in Oxagon, NEOM’s future industrial hub, the Port of NEOM aims to drive key capabilities in expansion to match the rising volume of cargo coming into the city, including container and general cargo handling.

According to Bloomberg, Crown Prince Mohammed bin Salman envisioned the massive project to be a marvel to boost the Kingdom’s economy and function as an epicenter for technology developments. This was motivated by his desire to “diversify the country’s oil-dependent economy”. 

Sean Kelly, managing director for the Port of NEOM, said that the port will be a “critical enabler” for the “import of goods and materials during the development phase (of NEOM) and as a new global port serving the region.”

He speaks with Maritime Fairtrade to expand on the functionality and design of the port and how it supports the business, livability and sustainability of NEOM. 

The port’s first phase of development will be powered entirely by renewable energy. What are the considerations and requirements to ensure its success? 

It is our ambition that when finished, the port will be powered by 100 percent renewable energy at source, enabling it to achieve its ambition of net-zero carbon emissions. However, looking beyond just our renewable energy ambitions, environmental sustainability has been a top consideration in the design and transformation of the Port of NEOM to align with NEOM’s sustainability principles. 

During our initial stage of development, we plan to transport dredged materials through pipelines for materials disposition, minimizing the use of trucks in our aim to achieve zero material discharge during our dredging program, and ensuring minimal environmental impact. 

Additionally, companies involved in the expansion are required to implement a robust Environmental Management System and utilize innovative construction methodologies and materials; for example, low-carbon steel frames will be used to construct the quay walls to reduce the project’s overall carbon footprint. 

In the long term, all our equipment will be electric and we will maximize automation. When it is completed, the design of the port will ensure 50 percent self-generated solar power with the other 50 percent set to come from the grids for the energy supply ENOWA (electric utility company in Saudi Arabia) is building. 

Beyond these critical steps, we recognize the importance smart technology also has in bolstering efficiencies and shaping sustainable operations. Singapore is a prime example of how using advanced technology with smart integration and leveraging its geographical advantages, it is possible to build a successful maritime industry. 

The greenfield nature of NEOM’s development allows us to consider new operating designs too. Vessel operations, warehouse operations, and the rail delivery system will be developed as part of a single facility.  

This integrated design, a ‘compressed supply chain’ if you will, with innovative applications enabled by the latest automation, will allow us to achieve unprecedented levels of utilization and throughput velocity, that position us to exceed our sustainability ambitions. 

It will also have a seven-part “nucleus” of industrial tracts. Please explain more about what these tracts are and how it will be different from other globally-leading ports. 

NEOM’s Oxagon is creating an ecosystem that fosters clean innovation and advanced manufacturing, with a focus on seven core sectors: water innovation, renewable energy, autonomous and sustainable mobility, modern construction, sustainable food production, health wellbeing and biotech, and technology and digital. Through our approach, automated port facilities, and supply chain network, manufacturers will have full transparency of the end-to-end value chain.

Most importantly, the design of the port is integrated into NEOM’s infrastructure from the ground up and its capabilities are being designed to support the build, and eventually the export of products and innovations manufactured in Oxagon – from across the ecosystem of its seven core industries. 

This allows us to make decisions about integration that increase its efficiency, across automation, overall efficiency and turnaround time. For example, our port will take goods from the ship and we will unpack containers in the advanced logistics center, then move goods straight onto the train which will then go directly to the fulfilment center – across numerous industries and their bespoke requirements.

This will save time and costs in the supply chain, and bring benefits for all – from third-party logistics firms through to manufacturers and customers, both in terms of import and export of materials during the construction phase and then in the operational phase.

To turn this concept into reality, we have benchmarked numerous projects and best practices around the world. Like Tuas in Singapore, NEOM’s vision is to build one of the world’s most technologically advanced, efficient and sustainable ports, with the first fully-integrated and automated supply chain and logistics network. We aim to be at the forefront of the maritime industry by staying ahead of the technological curve.

How we plan to achieve this is to use fully-automated port and warehouse equipment, ensuring man-machine separation for enhanced safety and efficiency. We are implementing cutting-edge solutions like Container High Bay (CHB) for automated container storage and retrieval. 

Artificial intelligence will optimize operating steps sequencing and end-to-end traffic flows. Our integrated and automated management systems, powered by AI, will include the Port Customer Digital Platform, Terminal Operating System (TOS), and Warehouse Management System (WMS).

The port plays a fundamental role in the construction of NEOM and how much it thrives in the future. Please share more on this.

The Port of NEOM will be an instrumental pillar to the overall build, operations and economic ambitions of NEOM. This is particularly important as development accelerates and businesses across NEOM come on-stream. Similarly, the port is a critical enabler for tenants in Oxagon – from their build to operations. 

Right now, we are facilitating the import of goods and materials needed during the construction phase of NEOM. Nearly everything we need to build NEOM can be shipped through the port. We manage containers, general cargo, and bulk shipping needs. We have storage facilities on-site and we are soon going to be opening dedicated warehouses for shippers right on the dock. 

Shipping to the Port of NEOM is a much more sustainable choice for supply chains as it takes trucks off the road, saves road miles and is much less costly in CO2.  

In addition, not only is the port strategically vital for the development of NEOM as a whole, it is also strategically vital for diversifying and growing the economy of Saudi Arabia and the wider region. 

The Port of NEOM’s location on the Red Sea coast, through which 13 percent of global trade passes, allows it to significantly enhance the region’s connectivity to the rest of the world. As in Singapore, where its strategic position facilitates the efficient movement of goods between Asia, Europe, and the Americas, Port of NEOM will boost the economy of the port’s catchment area in Northwest Saudi Arabia and open up new trade routes via regional sea feeder networks and an inland intermodal corridor to the East.

Photo credit: Port of NEOM. Sean Kelly, managing director for the Port of NEOM.

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