Upcoming Gangavaram port weans away top client from nearby Vizag
The private port is expected to eat into business of government-owned ports when it is operational next year
P. Manoj
Mumbai: A new private port, billed as India’s deepest, coming up at Gangavaram in Andhra Pradesh will start operations in April next year and has already poached a top customer from the rival Union government-owned Vizag port which is just 15km away.
The move will boost the new port’s ability to win more customers even before it is fully operational.
Gangavaram Port Ltd, a special purpose company floated by D. Venkata Satyanarayana Raju, the former co-founder of India’s fourth largest IT services firm Satyam Computer Services Ltd, has already signed a deal with the state-owned Rashtriya Ispat Nigam Ltd that runs the 3 million tonne (mt) capacity Vizag Steel Plant.
“We have signed a memorandum of understanding with Vizag Steel Plant for their import/export requirements,” said Pranav Choudhary, vice- president (finance), Gangavaram Port Ltd. Officials at Vizag Steel confirmed the decision.
Vizag Steel currently imports about 4mt a year of coking coal, limestone, thermal coal and other such raw materials for its steel plant through the Vizag port. The imports will rise to more than 6mt a year after the steel plant doubles its capacity to 6.3mt by October 2009. Vizag Steel also exports about one lakh tonnes of finished steel products to Sri Lanka, Thailand, Taiwan, the UAE and the US through the Vizag port.
This cargo will shift from Vizag port to Gangavaram port, thus eroding the business of the top ranking Union government-owned port. Vizag port handles the highest volume of cargo among all the 12 government-run ports in India. In the 12 months to March 2007, it handled 56.39mt of cargo out of a total traffic of 463.84mt.
“Gangavaram would be next door neighbour to Vizag Steel. We will build conveyors to take the imported raw materials directly to the plant, thus avoiding dependence on railways for moving the cargo from the port to the plant. This will also help cut the extra time and costs involved in hauling the cargo by rail from port to the plant,” Choudhary said. Because of the high level of mechanization in cargo handling, the port will help customers cut handling costs.
Being a port owned by the state government, the private operator of Gangavaram port is free to fix its own tariffs without consulting a regulator, whereas the rates for the 12 government-owned ports including Vizag are set by the Tariff Authority for Major Ports.
Gangavaram port would thus be able to fix competitive rates to lure customers away from Vizag port.
The new port will have a depth of 21m (the deepest among any Indian ports) and will be capable of handling super capesize vessels of up to 200,000 tonnes, helping users such as Vizag Steel to save on ocean freight costs. Capesize vessels can carry much larger volumes of dry bulk commodities such as steel, iron ore and coal.
“At this depth, Vizag Steel can bring their cargoes on capesize bulk carriers and achieve economies of scale since larger quantities of cargo can be transported at a time. This will lead to cheaper freight costs,” says T.V. Shanbhag, adviser with Mumbai-based shipping company Mercator Lines Ltd.
Vizag Steel currently ships raw materials on handymax carriers (that can load up to 50,000 tonnes) because the depth at Vizag port cannot accommodate bigger vessels. The inner harbour of Vizag port where most of its cargo handling berths are located has a depth of 11m.
Vizag port plans to deepen the inner harbour to 14m to accommodate panamax carriers that can typically carry 73,000-75,000 tonnes of dry bulk commodities. Still, it would be nowhere near the new port in terms of depth.
Gangavaram port is being developed in three phases with a capacity to handle 100mt of cargo when fully operational. The 35mt capacity, phase one development comprises five berths, one each for handling coal and iron ore and three multi-purpose berths for handling other bulk and general cargo.
A consortium of 13 banks led by State Bank of India has lent Rs1,170 crore to Gangavaram Port Ltd for funding the phase one development.
D.V.S Raju, who was also founder-chairman of Hyderabad-based IT services firm VisualSoft Technologies Ltd, has roped in the Dubai-government owned port operator DP World to develop and operate the port for a 30-year period.
Fearing that the development of Gangavaram would harm the prospects of Vizag port, the Union shipping ministry had earlier proposed a joint venture between Vizag port and the private operator of Gangavaram port.
But this was rejected by the previous Andhra Pradesh government headed by N. Chandrababu Naidu.
Naidu’s Telugu Desam Party (TDP) was a key constituent of the then ruling National Democratic Alliance government at the Centre. The NDA government also agreed to transfer about 1,400 acres of land belonging to the state-owned Rashtriya Ispat Nigam Ltd for developing the new port.
Vizag is the industrial nerve centre of Andhra Pradesh and is regarded as the gateway for trade with China and the Asean region
Thursday, September 13, 2007
Reliance looking for specialist container terminal operator
Reliance looking for specialist container terminal operator
When fully operational, the Rewas port will have 70 berths with a capacity to handle 457mt of cargo
P. Manoj
Mumbai: Mukesh Ambani-owned Reliance Industries Ltd will hire a global container terminal operator for its planned 2.6 million twenty-foot equivalent units (teu) a year facility at the Rewas port in Maharashtra.
A teu is the standard size of a container and is a common measure of capacity in the container business.
“We don’t have expertise in running container terminals,” said K.V. Natarajan, president, Rewas Ports Ltd. “Hence, we plan to have a strategic alliance with a global specialist in running container terminals or a container shipping firm and have started a dialogue in that direction.” He declined to elaborate.
Rewas Ports, which is 65% owned by various group companies operating under Reliance Industries, is building an all-weather deep draught (depth) port just 10km south of the central-government owned Jawaharlal Nehru Port, India’s busiest container port.
Amma Lines Ltd holds a 24% stake in Rewas Ports, while the balance 11% equity is owned by Maharashtra Maritime Board, the maritime regulator that oversees the development of ports owned by the state government.
Rewas port will be built in three phases. The first phase development costing Rs5,114 crore will involve 10 cargo handling berths with a capacity to handle 55 million tonnes (mt) of cargo. The new port will start operations on a 50-year contract beginning October 2010.
Since it is a port owned by the state government, Rewas Ports will be free to fix its own tariffs without consulting a regulator. However, the tariffs for cargo handling services at the 12 Union government-owned ports are set by the Tariff Authority for Major Ports.
When fully operational by 2040, Rewas port will have 70 berths with a capacity to handle 457mt of cargo, which is almost equal to the total cargo handled at the 12 Union government ports in the country.
These 12 ports handled 464mt of cargo in the 12 months to March 2007, compared with a capacity of 508mt.
Natarajan said that Rewas Ports will float global tenders in September to award the dredging work at the port that is estimated to cost about Rs1,800 crore.
The port will have a depth of 14.5 metres to start with and this will be increased to 20 metres in a phased manner.
The dredging contract at Rewas will be the biggest of such work ever executed in the country, bigger than the dredging work for the Sethusamudram ship channel project. It involves dredging 120 million cubic metres of stone, mud, sand and silt from the seabed.
A consortium of banks led by ICICI Bank Ltd has agreed to lend about Rs3,400 crore for the phase one development of the port, Natarajan said.
According to the union shipping ministry, the container cargo traffic at Indian ports is expected to grow to 12.5 million teu by 2011-12. Of this, 93% or 11.7 million teu are expected to be handled by the 12 Union government-owned ports.
The balance would be handled at ports owned by the state governments and which are being developed with private investments such as Rewas, Mundra, Pipavav, Hazira, Gangavaram, Pondicherry, Vizhinjam, Vijaydurg and Dighi, among others
When fully operational, the Rewas port will have 70 berths with a capacity to handle 457mt of cargo
P. Manoj
Mumbai: Mukesh Ambani-owned Reliance Industries Ltd will hire a global container terminal operator for its planned 2.6 million twenty-foot equivalent units (teu) a year facility at the Rewas port in Maharashtra.
A teu is the standard size of a container and is a common measure of capacity in the container business.
“We don’t have expertise in running container terminals,” said K.V. Natarajan, president, Rewas Ports Ltd. “Hence, we plan to have a strategic alliance with a global specialist in running container terminals or a container shipping firm and have started a dialogue in that direction.” He declined to elaborate.
Rewas Ports, which is 65% owned by various group companies operating under Reliance Industries, is building an all-weather deep draught (depth) port just 10km south of the central-government owned Jawaharlal Nehru Port, India’s busiest container port.
Amma Lines Ltd holds a 24% stake in Rewas Ports, while the balance 11% equity is owned by Maharashtra Maritime Board, the maritime regulator that oversees the development of ports owned by the state government.
Rewas port will be built in three phases. The first phase development costing Rs5,114 crore will involve 10 cargo handling berths with a capacity to handle 55 million tonnes (mt) of cargo. The new port will start operations on a 50-year contract beginning October 2010.
Since it is a port owned by the state government, Rewas Ports will be free to fix its own tariffs without consulting a regulator. However, the tariffs for cargo handling services at the 12 Union government-owned ports are set by the Tariff Authority for Major Ports.
When fully operational by 2040, Rewas port will have 70 berths with a capacity to handle 457mt of cargo, which is almost equal to the total cargo handled at the 12 Union government ports in the country.
These 12 ports handled 464mt of cargo in the 12 months to March 2007, compared with a capacity of 508mt.
Natarajan said that Rewas Ports will float global tenders in September to award the dredging work at the port that is estimated to cost about Rs1,800 crore.
The port will have a depth of 14.5 metres to start with and this will be increased to 20 metres in a phased manner.
The dredging contract at Rewas will be the biggest of such work ever executed in the country, bigger than the dredging work for the Sethusamudram ship channel project. It involves dredging 120 million cubic metres of stone, mud, sand and silt from the seabed.
A consortium of banks led by ICICI Bank Ltd has agreed to lend about Rs3,400 crore for the phase one development of the port, Natarajan said.
According to the union shipping ministry, the container cargo traffic at Indian ports is expected to grow to 12.5 million teu by 2011-12. Of this, 93% or 11.7 million teu are expected to be handled by the 12 Union government-owned ports.
The balance would be handled at ports owned by the state governments and which are being developed with private investments such as Rewas, Mundra, Pipavav, Hazira, Gangavaram, Pondicherry, Vizhinjam, Vijaydurg and Dighi, among others
Friday, September 7, 2007
Vizhinjam terminal in three years: Minister
Vizhinjam terminal in three years: Minister
Special Correspondent
THIRUVANANTHAPURAM: Work on the first phase of the Vizhinjam international container transhipment terminal will be completed in three years, Law Minister M. Vijayakumar has said.
Replying to questions in the Assembly on Friday, Mr.Vijayakumar said construction of the terminal was estimated to cost Rs.5,348 crore. The first phase was expected to cost Rs.2,390 crore. As many as 23 companies, including six foreign companies, secured tender forms for the project. The tender would be finalised in December, he said.
Special Correspondent
THIRUVANANTHAPURAM: Work on the first phase of the Vizhinjam international container transhipment terminal will be completed in three years, Law Minister M. Vijayakumar has said.
Replying to questions in the Assembly on Friday, Mr.Vijayakumar said construction of the terminal was estimated to cost Rs.5,348 crore. The first phase was expected to cost Rs.2,390 crore. As many as 23 companies, including six foreign companies, secured tender forms for the project. The tender would be finalised in December, he said.
Tuesday, September 4, 2007
Vizhinjam global tender receives 21 bidders
Vizhinjam global tender receives 21 bidders
Thiruvananthapuram, Sep 3:
Kerala Ports Minister M Vijayakumar today said as many as 21 tenders have been received from international companies for the proposed deep-sea container terminal at Vizhinjam, near here, for which the state government had floated a global tender.
Speaking at the inaugural function of dredging of the Vizhinjam harbour as part of the terminal's development works, the minister said six harbours among the 17 in the state would be developed in the first phase. ''The state's development lays in the development of ports,'' he noted.There was good response for the global tender and the evaluation of the bid would be completed by this month. Earlier, Mr Vijayakumar had said after security clearance in October, licence would be given to successful bidder in November and the construction would start in December 2008.
--- UNI
Thiruvananthapuram, Sep 3:
Kerala Ports Minister M Vijayakumar today said as many as 21 tenders have been received from international companies for the proposed deep-sea container terminal at Vizhinjam, near here, for which the state government had floated a global tender.
Speaking at the inaugural function of dredging of the Vizhinjam harbour as part of the terminal's development works, the minister said six harbours among the 17 in the state would be developed in the first phase. ''The state's development lays in the development of ports,'' he noted.There was good response for the global tender and the evaluation of the bid would be completed by this month. Earlier, Mr Vijayakumar had said after security clearance in October, licence would be given to successful bidder in November and the construction would start in December 2008.
--- UNI
Dredging work at Vizhinjam fishing harbour begins
Dredging work at Vizhinjam fishing harbour begins
Special Correspondent
Silt and garbage have raised the sea bed by a metre
Special Correspondent
Silt and garbage have raised the sea bed by a metre
THIRUVANANTHAPURAM: The Ports Department on Monday launched a short-term project to deepen the sea bed at the Vizhinjam fishing harbour, to provide safe berthing for cargo ships and tourist liners.
The basin inside the breakwaters is being dredged to its original depth of 5.5 metres. Ports officials said silt and accumulation of the waste dumped by fishing boats had raised the seabed in the harbour by one metre over a period of time. The basin would be dredged along a channel 100 m long and 50 m wide near the wharf for ships to berth safely.
A dredger, TSD Sindhuraj, belonging to the Kerala State Maritime Development Corporation has been pressed into service. It will remove 5,000 cubic metres of clay and sand from the seabed in an operation expected to last a week. The project is estimated to cost Rs.5 lakhs.
The trailer suction dredger is equipped with a tail-end nozzle and a hose to suck up the clay-sand mixture. The mixture is stored in a hopper tank of 200 cubic metre capacity. Once the tank is full, the vessel will head to the open sea to dump the mixture in deep waters.
Ports Officer Hari Achutha Warrier said that during the operation, 25 to 30 loads would be emptied in sea. Dredging would commence on Tuesday after removing fishing boats from the harbour area.
Minister for Ports M. Vijayakumar inaugurated the dredging project at the wharf on Monday morning. Ports Secretary L. Radhakrishnan presided over the inaugural function. District Collector N. Ayyappan, managing director of the Maritime Development Corporation K.K. Rajendran, Vizhinjam gram panchayat president Asuntha Mohan, Matsyafed chairman Pulluvila Stanley, Ports director Captain Vijayan Pillai and Mr. Warrier were present on the occasion.
The Vizhinjam fishing harbour currently handles general cargo ships mostly exporting goods to Maldives. Tourist liners also make an occasional call here.
Mr. Warrier said the reduced draft inside the harbour had made it impossible for bigger ships to approach the wharf, except during high tide.
“Deepening the harbour will make it possible for these vessels to come in any time. Periodic dredging during the post- monsoon period may become necessary,” he added.
The basin inside the breakwaters is being dredged to its original depth of 5.5 metres. Ports officials said silt and accumulation of the waste dumped by fishing boats had raised the seabed in the harbour by one metre over a period of time. The basin would be dredged along a channel 100 m long and 50 m wide near the wharf for ships to berth safely.
A dredger, TSD Sindhuraj, belonging to the Kerala State Maritime Development Corporation has been pressed into service. It will remove 5,000 cubic metres of clay and sand from the seabed in an operation expected to last a week. The project is estimated to cost Rs.5 lakhs.
The trailer suction dredger is equipped with a tail-end nozzle and a hose to suck up the clay-sand mixture. The mixture is stored in a hopper tank of 200 cubic metre capacity. Once the tank is full, the vessel will head to the open sea to dump the mixture in deep waters.
Ports Officer Hari Achutha Warrier said that during the operation, 25 to 30 loads would be emptied in sea. Dredging would commence on Tuesday after removing fishing boats from the harbour area.
Minister for Ports M. Vijayakumar inaugurated the dredging project at the wharf on Monday morning. Ports Secretary L. Radhakrishnan presided over the inaugural function. District Collector N. Ayyappan, managing director of the Maritime Development Corporation K.K. Rajendran, Vizhinjam gram panchayat president Asuntha Mohan, Matsyafed chairman Pulluvila Stanley, Ports director Captain Vijayan Pillai and Mr. Warrier were present on the occasion.
The Vizhinjam fishing harbour currently handles general cargo ships mostly exporting goods to Maldives. Tourist liners also make an occasional call here.
Mr. Warrier said the reduced draft inside the harbour had made it impossible for bigger ships to approach the wharf, except during high tide.
“Deepening the harbour will make it possible for these vessels to come in any time. Periodic dredging during the post- monsoon period may become necessary,” he added.
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