Unlocking the sea ports of the future
The Dutch are building the world's largest sea lock
The Port of IJmuiden is witnessing the construction of a new sea lock scheduled to become operational in 2019. The sea lock will be the largest of its kind in the world with 500-metre in length, 70-metre in width and 18-metre in depth. The new lock will ensure that the Port of Amsterdam will remain accessible to the next generation of vessels, as well as boosting economic growth and employment in the surrounding region.
The cruise ships and cargo ships anchoring in the Port of Amsterdam are gradually growing in size, to the point where many vessels currently have little room for manoeuvre within the walls of this waterway link. The current Noordersluis lock is not equipped to accommodate the sea-going vessels of the future, and these passenger and cargo ships will soon be compelled to use other sea ports in the Western European coastal waters. The new sea lock in the Port of IJmuiden is set to change all that.
Europe's fourth-largest port
When the Noordersluis lock – currently used by commercial vessels to access Amsterdam’s and the surroundings – was completed in 1929, it was the world's largest sea lock and would remain so until the late 1960s. Measuring 400 metres in length and 45 metres in width, the lock was certainly large enough to accommodate any vessel passing through the Port of Amsterdam. Now, nearly a century later, the supply of goods through the lock has more than doubled and the new generation of vessels built by manufacturers is both longer and wider. The Port of Amsterdam remains Europe's fourth-largest port, and the surrounding port region is one of the key drivers of the Dutch and European economies. If the port is to maintain and improve this position, it needs to adapt the current lock complex to modern-day requirements.
Ingenuity in hydraulic engineering
Dutch construction companies BAM and VolkerWessels have been contracted to develop this masterpiece of hydraulic engineering. Two other home-grown companies, international dredging and offshore contractor Van Oord and dredging and marine expert Royal Boskalis Westminster, have been subcontracted to carry out dredging works for the mega-project, while investors PGGM and DIF round out the building consortium.
'This is truly a unique project, which gives us the opportunity to show that the Dutch are still world leaders when it comes to large-scale hydraulic engineering projects,' says BAM CFO Thessa Menssen. Rabobank is one of the financiers of the project. Robbert Klaasman, who, as the bank's Managing Director Large Corporates, is in charge of the Manufacturing, Construction, Engineering and Maritime sectors, 'This project combines a number of important aspects: innovativeness, improvement of the quality of life in the region, economical boost and employment growth. This is right in line with the principles and strategy set out in our Banking for the Netherlands programme, through which we would like to use our knowhow, networks and resources to try to improve life in our country. Since we have longstanding relationships with some of the biggest names in the Dutch construction industry, it makes perfect sense to help fund this mega-lock,' says Klaasman.
The private-public partnership model
'Rabobank is proud to be involved in financing this high-profile project with an international scope, and it’s the only Dutch bank in the conglomerate at that,' says Ewout Krijger, Project Finance Specialist. The project is funded through a Public-Private Partnership (PPP), in which public authorities and private companies work together in launching large-scale construction projects.
Krijger says, 'This is the first sea lock of this size to be financed based on a PPP arrangement. It's a good example of how public authorities and contractors outside the Netherlands can handle these types of projects. Rabobank provided the bridge credit facility for the equity capital during the construction period. The consortium needs this equity capital in order to realise the plans. Rabobank has also facilitated all the guarantees, which is a condition for getting all the stakeholders on board for a project of this size, along with the financing.'
The contractor, not the public authority, is responsible
Rabobank has acquired extensive experience with the specific form of Public-Private Partnership the Directorate-General for Public Works and Water Management (Rijkswaterstaat) has chosen for this project: Design, Build, Finance, Maintain (DBFM). In this type of arrangement, the contractor, rather than the public authority, is responsible for the design, construction, finance and maintenance of a particular structure. This ensures a more integrated and coordinated process. Krijger says, 'Since we have expertise with this type of partnership, companies contact Rabobank whenever a new project is launched. We were previously involved in several other exciting, high-profile DBFM projects, such as the redevelopment of the former Ministry of Housing, Spatial Planning and the Environment (VROM) in The Hague, the construction of the N33 motorway and the development of the high-speed railway.'
Klaasman says, 'Since all the members of the consortium are customers of Rabobank, we were able to offer a special financing structure, which eliminated the need for the customary external bank guarantee.'
VolkerWessels CFO Jan van Rooijen says, 'This innovative form of financing provided by Rabobank enabled us to make a competitive offer.'
Photo credit: Henk Honing
Bigger than Panama
With more than 40,000 vessels passing through the lock on an annual basis and more than 97 million tonnes of goods transported, the Port of Amsterdam is one of Europe’s largest logistics hubs. The construction of a new sea lock is designed to ensure that it maintains this status. The lock is deeper than the current Noordersluis lock. With a depth of 15 metres, vessels are virtually unaffected by the tides. Low-lying vessels will soon be able to enter the lock at any time of the day, saving them considerable time. The lock will be operational in 2019.
Rabobank: constructing for the Netherlands
- The Dutch construction sector has a production volume of more than 55 billion euros, provides employment to more than 460,000 people and accounts for a total of 4.5 percent to Gross Domestic Product (GDP).
- The 10 largest construction companies account for 50 percent of this rate, equivalent to 2.25 percent of GDP.
- Rabobank Wholesale serves this top 10 of construction companies, making the bank one of the main financial partners of the construction industry in the Netherlands.