Qatar targets $10 billion of investments in U.S. ports -sources

LONDON/DUBAI, (Reuters) - Qatar plans to invest at least $10 billion in U.S. ports and has approached international banks for financing help, three finance sources say, in an infrastructure spree that reflects the Gulf country's deepening ties with Washington.

The Middle East and Western sources familiar with the matter said Doha was targeting investments in ports around the U.S. East Coast which were expected to be developed in phases, adding that the plan was at a preliminary stage.

The country's sovereign wealth fund Qatar Investment Authority and the Qatar Government Communication Office both declined to comment.

"The Qataris have been preparing for almost a year to test the waters with U.S. port investments," said Michael Frodl, a U.S.-based adviser on projects including maritime security, commerce and infrastructure, who is familiar with Qatar's strategy.

"We think that a shrewd investor with the $10 billion the Qataris desire to put into American port infrastructure would likely look at the underserved East Coast first and foremost. The West Coast is getting all the U.S. government and private investment attention, while the East Coast is long overdue for improvements."

Frodl said ports with easy access to highways and rail lines would be a priority.

"We'd be looking at aging mediumsized ports south of Boston and north of Jacksonville," he added.

A Middle East-based source said the investments would be backed by debt, which would be linked to the port assets, adding that Qatar was in early discussions with banks to look for a structuring adviser.

The banks being approached included Morgan Stanley, HSBC and Credit Suisse, two of the sources said.

Morgan Stanley, HSBC and Credit Suisse declined to comment.

In November Congress approved U.S. President Joe Biden's $1.2 trillion infrastructure package, which port and industry sources say includes $5.22 billion of federal funding for port specific programmes, falling short of the tens of billions of dollars estimated to be needed for investment in creaking infrastructure.

U.S. transport secretary Pete Buttigieg told an online news briefing with the Port of Los Angeles on Nov. 16 that while Washington was delivering a "historic level of funding" to improve ports, "it can't all be from federal grants".

"We're going to have to keep working with local, state and private partners in order to make sure that we have the kinds of resources that are needed," Buttigieg said.

There are around 360 ports in the United States, according to the U.S. Coast Guard.

The Middle East-based source said Qatar could look to target three port projects. A fourth finance source separately confirmed Qatar's investment plans in the United States.