Ports & Shipping News

August 15, 2011 August 21, 2011

India Infrastructure Publishing B-17, Qutab Institutional Area New Delhi 110016 Tel: 91-11-4103 4600 / 4601 Fax: 91-11-2653 1196 E-mail: info@indiainfrastructure.com

Ports The Ministry of Shipping (MoS) has set up a four-member team to finalise a policy on captive ports, which is likely to take a month. Under the draft policy, companies in the port-based industry which are dependent on port facilities for their business, especially for importing raw material or exporting products, will be eligible to set up captive ports. According to sources, MoS, which has received various comments and objections to the proposed policy, will try to address those concerns before the final policy is drafted. The policy was primarily mooted in 1996 as part of a notification for allowing private participation in the port sector. In the absence of clear guidelines and definitions, the government decided to put in place a separate policy for captive berths in 2008. Meanwhile, MoS has engaged The Energy and Resources Institute (TERI) to review the tariff guidelines of 2005. The terms of reference (ToR) for the study are provided in the ministrys website. Stakeholders can offer their views and comments on the issues covered under the ToR by September 20, 2011. The Government of India (GoI) is planning to set up a new major port in the state of Andhra Pradesh which will be second to Visakhapatnam port. The Indian Maritime University was entrusted to study the feasibility of relocation of the fishing harbour on the beach road. Meanwhile, GoI has offered to develop one major port each in the seven coastal states during the Twelfth Five Year Plan (2012-17). The estimated cost of investment ranges between Rs 180 billion and Rs 200 billion during the five-year period. According to sources, under the proposed project, the state governments will have to play the role of a facilitator to ensure land for developing such facilities and the GoI will need to spend Rs 25 billion or more to develop each port. The Government of Kerala has decided to develop the Vizhinjam port in Kerala under a landlord port model. As per the arrangement, the government/Vizhinjam International Seaport Limited will develop the basic infrastructure requirements for the port like breakwater, quay wall, dredging and reclamation, and external connectivity (road, rail and utilities) through an engineering-procurement-construction (EPC) contract and the private partner (port operator) will construct the superstructure for the port operations and the terminal and operate and maintain it for a period of 30 years. The request for qualification (RfQ) for the port operator was published through a global notification. A total of 14 applications were received and reviewed by the project advisors, International Finance Corporation (IFC) and evaluated by the Empowered Committee and the recommendation to prequalify 12 bidders was accepted by the state government. From the 12 prequalified bidders to whom the request for proposal (RfP) and draft concession agreement was given on February 18, 2011, only two bidders a consortium of Welspun Infratech Limited, Welspun Corporation Limited and Leighton Welspun Contractors (India) Private Limited and the Mundra Port and Special Economic Zone Limited submitted their bids. The technical bids, which were opened on August 16, 2011, will be scrutinised for responsiveness and compliance to RfP. On completion of the technical evaluation, the financial bids will be opened. The new customer facilitation centre has been inaugurated at the Cochin Port Trust. The facilitation centre will serve as a single-point contact to provide customers with authentic guidance on different services from various divisions of the port trust. The facilitation centre has a conference kiosk. Larsen & Toubro (L&T) is planning to set up two greenfield ports in Gujarat and Orissa respectively. The project is at an initial stage of planning. According to sources, the company has zeroed in on a site in Gujarat, but it is planning to finalise the location in Orissa in the second quarter of 2012-13. Meanwhile, L&T is planning a second phase of expansion at the Dhamra port in Orissa, which is a joint venture (JV) with Tata Steel Limited. The port, which has been operational since May 2011, is soon expected to be formally commissioned. All the 12 major ports in India are witnessing a steady increase in cargo traffic every year but posting a decline in efficiency. The major ports have registered an increase in average pre-berthing time and average turnaround time of vessels. The major ports recorded 1.61 per cent increase in average pre-berthing time to 11.96 hours during 2010-11 against 11.77 hours in 2009-10. The maximum increase of 111.11 per cent was seen at the Jawaharlal Nehru Port Trust (JNPT), the third largest port in the country in terms of traffic handled. The major ports also had a 5.69-per cent rise in average turnaround time to 4.64 days during 2010-11 against 4.39 days in 2009-10. JNPT registered an increase of 32.18 per cent, the highest among any major port.

Ports & Shipping News

August 15, 2011 August 21, 2011

India Infrastructure Publishing B-17, Qutab Institutional Area New Delhi 110016 Tel: 91-11-4103 4600 / 4601 Fax: 91-11-2653 1196 E-mail: info@indiainfrastructure.com

Gujarats third liquefied natural gas (LNG) terminal is expected to be in place in the next three years
following the go-ahead given by the state government to the 50:50 joint venture (JV) between Gujarat State Petroleum Corporation Limited (GSPC) and the Adani Group, to develop an LNG terminal at Mundra. According to sources, the JV partners are likely to invest an estimated Rs 40 billion. Work on the much-awaited terminal will commence shortly and will be completed in 36 months. The initial import capacity of the terminal will be five million tonne per annum (mtpa). Essar Ports Limited (EPL) is planning to venture abroad and is looking for opportunities to develop ports in emerging markets. According to sources, the company is evaluating projects in places that are mineral-rich. This will enable the company to handle bulk cargo for captive and third-party use. Meanwhile, EPL plans to almost double its port capacity to 160 million tonne (mt) by 2013 from 88 mt now. It had planned overall investment of Rs 90 billion, of which Rs 63 billion is invested. Sical Logistics Limited has registered an increase of 4.54 per cent in total income at Rs 1.38 billion in the first quarter (April-June) of 2011-12 as against Rs 1.33 billion in the corresponding quarter of the previous fiscal 2010-11. The net profit during the period decreased to Rs 26.39 million from Rs 75.03 million in 2009-10. However, the total expenditure for the period increased to Rs 1.29 billion from Rs 1.27 billion. Shipping The Government of Gujarat has banned entry of all ships above 25 years from entering ports which come under the administrative control of Gujarat. The state government felt the need to initiate the move after the sinking of m v Rak Carrier, the 27-year-old ship, off Mumbai's coast recently, while on its way to the port of Dahej with 60,000 tonne of coal from Indonesia. Mercator Lines Limited (MLL) has recorded a total consolidated income of Rs 8.01 billion during the first quarter (April-June) of 2011-12 as compared to Rs 6.03 billion during the corresponding quarter of 201011, posting a growth of 32.8 per cent. Net profit for the quarter stood at Rs 147.30 million as against Rs 616.96 million, registering a decline of about 76 per cent. However, the total expenditure for the period increased to Rs 6.48 billion in 2011-12, as against Rs 4.01 billion in the corresponding quarter of the previous fiscal year. As on June 30, 2011, MLL owns or operates a fleet of 18 dry carriers, eight tankers and four dredgers with an aggregate capacity of about 2.41 million deadweight tonnage (DWT) of an average age of about eight years. Varun Shipping Company Limited has posted a decline of 38.31 per cent in total income at Rs 1.51 billion during the first quarter (April-June) of 2011-12 as compared to Rs 2.46 billion in the corresponding quarter of the previous fiscal 2010-11. The company witnessed a net loss of Rs 352.53 million in the first quarter (April-June) of 2011-12 against a net profit of Rs 235.48 million in the previous year. The total expenditure for the quarter also declined to Rs 1.31 billion as against Rs 1.67 billion in 2010-11. SKS Logistics Limited has posted a 22.34-per cent decline in total income at Rs 62.08 million during the first quarter (April-June) of 2011-12 as compared to Rs 79.94 million during the corresponding period of the previous fiscal. During the same quarter, the company recorded a net profit of Rs 3.99 million in 2011-12 as against a net profit of Rs 6.75 million, a decline in growth of about 40.88 per cent. The total expenditure incurred during the quarter has also decreased to Rs 47.58 million as against Rs 59.03 million in the corresponding quarter of the previous fiscal 2010-11. Bharati Shipyard Limited has registered a growth of 21.14 per cent in total revenue at Rs 4.39 billion in the first quarter (April-June) of 2011-12 as compared to Rs 3.63 billion in the corresponding quarter of 2010-11. The net profit for the quarter stood at Rs 173.09 million, a 21.77-per cent decline from Rs 221.27 million over the previous years corresponding quarter. However, during the same period, the total expenditure increased from Rs 2.73 billion in 2010-11 to Rs 3.08 billion in 2011-12. Pipavav Defence and Offshore Engineering Company Limited (erstwhile Pipavav Shipyard Limited) has registered a growth of 83.5 per cent in total income at Rs 3.45 billion in the first quarter (April-June) of 2011-12 as compared to Rs 1.88 billion in the corresponding quarter of 2010-11. The net profit for the quarter stood at Rs 79.43 million, as against a net loss of Rs 97.89 million in the previous years corresponding quarter. The total expenditure incurred during the quarter has increased to Rs 2.89 billion as against Rs 1.75 billion in the corresponding quarter of the previous fiscal 2010-11.
Note: Rs 1 crore = Rs 0.01 billion; Rs 1 lakh = Rs 0.1 million; Rs 1,000 million = Rs 1 billion