Port terminal construction costs can be categorized into three types of expenditures:
- Capital expenditures (Capex; around 60% of total costs) are divided into maritime infrastructure (30%) and yard civil works costs (30%). Marine infrastructure concerns work related to the nautical readiness of a terminal for the expected ship class. It can involve channel and berth dredging, land reclamation for terminal space, the construction or widening of a turning basin, and quay wall construction. Yard civil works include apron design to support the required cranes and cargo loads, the mooring system, and pavement for yards and roads. For instance, a 300 mm-thick reinforced concrete pavement is required to support the loads of container terminal operations.
- Superstructures (around 25% of total costs) are divided into buildings and systems (15%) and equipment (10%). Buildings and systems include electrical and telecommunications wiring, buildings supporting terminal operations (offices, warehouses, repair shops), and terminal gates for trucks and rail. Equipment encompasses all terminal-handling equipment, notably ship-to-shore cranes, yard equipment, and intra-terminal vehicles. A ship-to-shore crane can easily reach $10 M.
- Soft costs (around 15% of total costs) are divided into project management (5%) and contingencies (10%). Project management includes a series of tasks, such as master planning and the civil and marine engineering design of the terminal. It also concerns managerial tasks to ensure the completion and delivery of an operational terminal. Contingencies take account of unforeseen circumstances that can delay a construction project, adding to its costs. There are also potential fluctuations in the cost of key construction materials, including labor, that can add to construction costs.
Multiplier effects can have a positive or negative impact on the construction cost structure. The geotechnical conditions of the terminal site, such as soil conditions, may require additional preparation to ensure stable foundations. Procurement costs can vary depending on the location of the terminal project in relation to construction materials that are heavy to transport, such as cement. Water availability can also be crucial. There is a wide range of subsidies and mitigation strategies that could affect construction costs. Funding opportunities from public agencies, such as infrastructure development programs, often target ports as strategic investments, with subsidies, preferential interest rates, or tax abatements. Compliance with regulations can add costs, particularly if they change since the project was designed.
The cost structure of a port terminal is, therefore, far from being an exact science because of its engineering, economic, financial, and regulatory complexity, each potentially changing the cost structure of identical projects in different locations. Smaller terminals are in the $500 million price range, while terminals accommodating the largest classes of container ships can cost $1 billion. The world’s largest container terminal project, Tuas Mega Port, is estimated to cost $20 billion, with the first phase costing $2.5 billion and a capacity of 20 million TEUs.