The Hindu Business Line : POSCO plan for captive port hits a rough patch

Korean steelmaker Pohang Steel Co's (POSCO) insistence on a private captive port at Jatadhari, about 7 km from Paradip, has run into rough weather with the Orissa Government insisting that the company use the unutilised capacity at Paradip port.

"What is the need for the captive port when almost half of Paradip's capacity is unutilised? They are asking for tax concessions and so many things but this demand for private port may lead to undesirable situation,"

highly placed sources in the ruling Biju Janata Dal (BJD) told Business Line.

Pointing out that POSCO's phased work plan includes developing iron ore mines in the beginning, followed by port development and, finally, commissioning of the steel plant, sources close to the developments questioned the very necessity for the minor port.

The Paradip Port Trust has also invited POSCO to set up a captive berth in the port's vicinity, officials said.

Sources said that POSCO would export 30 per cent of the iron ore mined here and replace this with other quality ores.

According to POSCO, the company plans to invest around $900 million for the port project to be constructed in two phases.

The first phase would involve an investment of $600 million, which will be distributed in two modules of $400 million and $200 million respectively.

In the second phase, the company would invest an additional $300 million.

Paradip Port authorities too appear worried.

According to official sources, the port is already experiencing erosion on its northern side and accretion on the southern side.

The port is situated north of the proposed site for the POSCO port.

"There are fears that the construction of the POSCO port might entail erosion on its northern side, thus threatening our port," sources said.

Another major concern is that when Indian Oil Corporation sets up its facilities somewhere between Paradip port and POSCO's proposed port, it could further complicate shoreline management, officials said.

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