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Business
Ambitious growth plans for Kakinada deep water port
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One of the focus areas under the roadmap would be handling vegetable oils and palm-based products by creating strategic partnerships for establishing edible oil refineries, which would import the oil, refine them, pack and market the same in domestic and global markets.
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THE KAKINADA Seaports (KSPL) has prepared an ambitious roadmap for its deep water port (KDWP) to achieve a growth potential of a 6 million tonne throughput in the next five years. At present, it is handling about half that quantity.
According to Dr. Kamesam M.V.S.R., KSPL's chief executive officer, this target should not be difficult to achieve because of KDWP's advantages, such as all time low pre-berthing and turnaround time (1.23 hours) with no idle time, operating round the clock, and channel depth of 12 metres.
KSPL is a special purpose company of the International Seaports Pte. Ltd., a joint venture of Larsen and Toubro, Precious Shipping Public Co. and SSA Asia Inc. of Washington, and has association with Konsortium Logistics Berhad of Malaysia which is operating in the Asean region. Originally known as the Cocanada Port Co. Pvt. Ltd., it entered into a memorandum of understanding with the Andhra Pradesh Government to develop KDWP on OMST (operate, manage, share, transfer) basis for a 20-plus-10-year period.
The CEO's confidence is based on the landmarks KDWP had achieved since its privatisation 32 months ago. KSPL wants the OMST lease for 30 years straightway instead of keeping the extension in suspense.
Further, it has sought that the Government alter the MoU replacing the existing minimum guarantee arrangement with a revenue-sharing arrangement as obtaining in the telecom sector which has also doubled the lease period to private service providers to 20 years.
As per the MoU, KSPL would have paid the Government at the end of 20 years Rs. 947 crores on the basis of an annual 8 per cent escalation in the wholesale price index. "But, with WPI escalation having slid to 4 per cent now, the total payable amount would also be reduced to Rs. 462 crores. We have indicated to the Government that if the payment mode is changed to revenue-sharing arrangement (20 per cent of the annual gross revenue), the total amount payable would touch Rs. 566 crores at the end of the 20-year block,'' Dr. Kamesam explained to The Hindu, hinting at a KSPL guarantee on this amount.
A switchover to the revenue-sharing mode would also enable KSPL to achieve easily the successful implementation of the growth roadmap, he felt.
Highlighting the salient features of the growth roadmap, he said the focus would be on attracting new cargoes and increasing the existing ones. This would help in getting cargoes diverted from Visakhapatnam, Chennai and JNPT (Jawaharlal Nehru port) "thanks to our cost-effective price levels'' and in creating fresh business opportunities through value added and integrated offshore base management services, besides coastal transportation, ship-to-ship (STS) transfer, mechanisation of handling facilities and an efficient port rail system. "Speed and productivity at an economical tariff would be the guiding principle,'' Dr. Kamesam said.
Towards this end, KDWP would offer a wide spectrum of port-based, vessel-based, land-based and Government-related services. It would also have a constant and closer interface with the existing and prospective foreign trade interests to ascertain their requirements.
Mr. Kamesam revealed that KDWP had been chosen to handle grain exports in association with the Central Warehousing Corporation. Similarly, a world class port-based hydrocarbon terminal, estimated at Rs. 19,400 crores, which would be on a par with those available in Singapore and Rotterdam, "is to be developed by the Kakinada India Oil Consortium, comprising Indian Oil, Petronas, KSPL and Bharat Petroleum, for cost-efficient fuel supply for all power projects in Andhra Pradesh, Tamil Nadu, Karnataka, Orissa and Maharashtra''. It would have an LNG terminal, product terminals and a 1000 MW power project.
One of the focus areas under the roadmap would be handling vegetable oils and palm-based products by creating strategic partnerships for establishing edible oil refineries, which would import the oil, refine them, pack and market the same in domestic and global markets. Coastal transportation, tankage, new pipelines to distribute edible oil to various sources and new exchange pit with valve arrangement for use by importers would be created.
KDWP would be able to attract a substantial exportable iron ore, at present done through Chennai port. Ore exporters in the Bellary-Hospet belt could benefit by the discounted rail freight by routing their cargo via KDWP.
Coal handling could be improved by coastal transportation and STS transfer of this bulk cargo in the next few years. Facilities provided in this regard would encourage thermal power projects in A.P. and Karnataka (Raichur) to use the deep water port.
"We intend enlarging our container handling capacity with a view to getting cargoes such as tobacco, ceramics, pharmaceuticals, electricals, blades, meat, cement clinker and paper diverted from the congested ports like Visakhapatnam, Chennai and even JNPT. By this we can aim at a monthly traffic of 5,000 TEUs (20 feet equivalent units) in the next three or four years. The Container Corporation of India (Concor) may join hands with us in laying a rail link to Kakinada Port station and organise fast track trains from the hinterland, particularly from Nagpur, Hydrerabad, Visakhapatnam, Koraput, Raipur and Chennai,'' the CEO said.
A service support base for oil and drilling companies operating in the Krishna-Godavari basin, including the Ravva structure and Machilipatnam blocks, forms part of the growth roadmap.
R. Sampath
in Visakhapatnam
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