The government of Algeria has approved plans for the construction of a new deep water port facility at the industrial zone of El Hamdania. The project is estimated to run $3.3 billion.

According to African Business magazine the project will attempt to replicate the success of the Tanger Med project in Morocco. The Tanger Med 1 port in Tangier, Morocco, started operations in July 2007 and handled 1.7 million TEUs in 2015. A new container transshipment terminal at the Tanger Med 2 port complex was announced last year. The complex will have annual capacity of five million TEU. Total investment in the new terminal is expected to be $864 million. When completed next year, Tanger Med is expected to be the busiest port on the Mediterranean.

The Algerian port is being developed by China Harbor Engineering, and China State Construction Engineering Corporation, which will hold a combined stake of 49 percent in the operating company. The remaining 51 percent will be owned by the Algerian Ports Authority. The port authority has reportedly raised $900 million in funding from the African Development Bank. Additional funding will come from a consortium of Chinese banks.

Port construction at El Hamdania will be done over two phases, with an eventual buildout of 23 berths and total handling capacity of 6.3 million TEU. El Hamadania is located 43 miles west of the capital city of Algiers. Its planned capacity would make the port the second busiest port in Africa after Tanger Med.

Construction is set to begin next month and is expected to be completed in 2021. The port will seek to attract transshipment business from West Africa and Europe.