APM Terminals has signed an agreement with Ningbo Port Group to invest $508m in a joint project to build a new facility at the Meishan Container Terminal in China.

Under the deal, APM and Ningbo Port Group will have a stake of 25% and 75% respectively in the project and will jointly operate berths 3, 4, 5, comprising a one kilometre quay in the terminal.

According to APM, the project will become operational by 31 December 2014 and after completion both the companies will operate the terminal for 50 years.

APM Terminals CEO of the Asia-Pacific region Henrik Lundgaard Pedersen said, "This agreement creates important, new port capacity needed for our customers in one of the fastest growing container markets in the world."

Container throughput in Ningbo, which is a major gateway port in Eastern China and the Zhejiang Province, increased 17% annually from 2006 to 2010 and reached 14.5 million teu in 2011.

By the end of this year, Ningbo capacity utilisation at the current growth rate is expected to exceed 80% and the new berths in the Meishan terminal will meet future capacity.

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By GlobalData

Ningbo’s new terminal has five deep water container berths with designed capacity of 3 million teu and is located near Meishan Bonded Port Zone in Sichuan, China.

The company said that Zhejiang province drives 95% of Ningbo’s growth, which is the 4th largest economy and 5th largest export/import hinterland in China, serving a population of 55 million.