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Business

Expansion of Greenland’s main port would pay for itself, consultants say

Benefits of larger ships being able to dock and unload will more than make up for costs of rebuilding Nuuk harbour
Business
The port of Nuuk is currently too small to handle big cargo ships (Photo: Wikipedia)

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The port in Nuuk, Greenland’s capital city, is too small. The country’s parliament agreed last year to an expansion estimated to cost DKK 600mn ($109mn) Danish kroner. A report from a management company hired by the country’s finance ministry said Greenland could earn that money back and more over a ten-year period as a result of more efficient port operations following the expansion.

The port at Nuuk today is not large or deep enough to handle larger ships. The limited capacity makes handling loading, unloading, terminal logistics and the storage of containers laborious, tedious and expensive. Companies are forced to rent extra storage space outside of the harbour and transport goods into Greenland using trucks and other methods, resulting in higher prices for consumers and putting a strain on Greenland’s entire economy.

“The purpose of expanding the port is to reduce the need for future freight rate increases and provide an infrastructure that can stimulate the growth of the entire community,” said Jacob Rosenberg Nielsen, spokesperson from Ramboll Group, the company hired to assess the rebuilding of the harbour.

Less expensive and more environmentally sound
Ramboll studied areas like infrastructure, environment and sustainable urban development and reached the conclusion that expansion of the port was the only real solution if Nuuk is to continue to thrive as a modern port city.

“The economic analysis showed that the expansion will result in a significant economic benefit for the Greenlandic community, paying back DKK 600mn in about 10 years,” said Nielsen.

The government-owned Royal Arctic Line is one company that would benefit greatly from a port expansion at Nuuk.

“A new port of Nuuk will affect all of Greenland,” Jacob Strøm, spokesperson for Royal Arctic Line told Greenland Today. “A new and more efficient port means a more efficient infrastructure, where ships can be loaded and unloaded quickly.”

Strøm also said that a more efficient port would be better for the environment, cutting fuel consumption, travel distances and allowing for the use of larger, more environmentally sound vessels.

Better for tourism
Along with improving conditions for container trade, a refurbished port in Nuuk will allow Greenland to become even more involved in the burgeoning Arctic tourism industry.

“A new port will have a positive effect on Nuuk as cruise city as it will be able to offer the cruise ships a berth,” said Malik Milfeldt from Visit Greenland. “This would allow passengers to stay longer on shore and hopefully buy more.”

The port expansion is scheduled to be completed in 2016.