The annual capacity is 55 mt, to which will be added another 15 mt or so this fiscal with the commissioning of the SBM.

Excerpts from the interview:

We keep hearing a lot about your plans to construct two deep draught dry bulk cargo handling berths. At what stage…

We’ve received the in-principle approval of PPPAC (Public Private Partnership Appraisal Committee) and will shortly invite RFQs (Requests for Qualifications) globally. Our plan is to finalise the BOT operator by March 31,2008. But, then, a plethora of formalities have to be completed before that.

What will be the capacity of the berths and the estimated costs?

The capacity will be 10 mt each and the costs Rs 505 crore for the iron ore berth and Rs 384 crore for the coal berth. The ore berth will handle exports and the coal berth imports, generally.

Plans for more berths…

Indian Oil Corporation has sounded us if we can build for it two berths mainly to facilitate exports of petroleum and petrochemicals products of its refinery and petrochemicals complex proposed at Paradip. We’re also mulling two container berths. A consultant is being appointed soon to have a feasibility report ready for the proposed berths.

What is your traffic projection for the current year (2007-08)?

The target for the current fiscal has been fixed at 45.78 mt as compared to 38.52 mt handled in 2006-07. We’ve so far handled 9.28 mt compared to 8.62 mt in the same period last year, despite the hit we took in May following three days of power cut to the port. Also, as you know, the monsoon months are not exciting for cargo handling. Yet I’m confident of achieving the target.

Is the much-talked-about Single Buoy Mooring going to be commissioned this year to bring additional traffic?

An SBM, as you know, is being installed by IOC which hopes to make it operational by December. Hopefully around that time crude will start flowing into Paradip port for the first time.

How much crude traffic you hope to handle?

Difficult to estimate now. Initially, the throughput will not be much. Any new system takes time to stabilise. Once stablilised, we should hope to handle around 15 mt annually.

Crude will certainly be a new item of traffic. Any other new item…

Quite a few, all imports though. For example, the project cargoes have emerged a key item. Among others are clinkers, manganese ore and urea.

Last year we handled urea for the first time after 10 years and the volume was 90,000 tonnes, likely to rise to around 300,000 tonnes in the current fiscal.

Foodgrains…

Frankly, we do not want foodgrains. We do not have a clean cargo berth; foodgrains, if imported, will get contaminated.

In 2006-07, Paradip handled imported thermal coal for power plants. What about this year?

Last year, we handled nearly two mt of imported thermal coal for power plants. The trend so far is not encouraging, presumably because National Thermal Power Corporation, the major importer, is yet to firm up import contracts for its Kanhia plant in Orissa. Last year NTPC also imported through our port some quantities of coal for its Farakka and Kahalogaon plants. The prospects of that cargo appear to be remote, at least so far.

And thermal coal for coastal shipments…

Paradip port’s mechanical coal handling plant, built with assistance from the Asian Development Bank, can handle as much as 20 mt annually but the throughput stagnates at around 10 mt annually because of the linkages finalised by the authorities concerned. What to do?

Aren’t you acquiring new equipment to handle the projected increase in traffic throughput?

We’ll procure two more 20-tonne cranes and have decided to hire one 140-tonne capacity mobile harbour crane. We not have much problems in regard to equipment.

What about the dredging due for some time?

Dredging is needed for the deepening and extension of the channel. The depth of the channel will be increased from 12.8 metres to 18.7 metres and the length of the channel from 2 km to 10 km. A total of 15 million cubic metres have to be dredged over one year from the date of the award of the contract.

When are you awarding the contract?

As soon as we get the government approval of the revised cost estimate of Rs 253 crore against the original estimate of Rs 154 crore. We’ll award the contract to Dredging Corporation of India, the lowest bidder.

How are you doing financially?

Quite well. Paradip port’s operating surplus in 2006-07 amounted to Rs 314.16 crore compared to Rs 251.54 crore in 2005-06 and the net surplus (before tax) to Rs 292.92 crore (Rs 191.32 crore). We’ve cleared the ADB loan (more than Rs 600 crore) contracted for the construction of the mechanical coal handling plant.

We’ve another Rs 200 crore of loan (together with interest payment) to the Union Government and we’ll repay it within this fiscal. We’ve created pension funds. Financially, we’re in a healthy position.

What is your biggest challenge?

The biggest challenge facing the port is how to have the capacity expanded at the earliest. Right now the annual capacity is 55 mt, to be added by another 15 mt or so in the current fiscal itself with the commissioning of the SBM.

By 2010, when the coal and ore berths are to be ready, the capacity will be up by another 20 mt and further by another 20 mt by 2012 when the IOC’s berths and the container berths will be ready for operation.

By 2011-12, the port’s capacity should reach 110 mt.

How can you support such a capacity expansion without proper connectivity?

There is a double-line rail link between Cuttack and Paradip. In addition, a new 78-km Haridaspur-Paradip railway line is being constructed by Rail Vikas Nigam Ltd through an SPV in which the PPT holds 10 per cent equity. The project cost is estimated at Rs 598 crore and the expected date of commissioning 2009. The four-laning of the National Highway 5A, connecting Paradip with Chandikhol on NH 5, is in progress at an estimated cost of Rs 442 crore and we’ve put Rs 40 crore in it. The target date of completion is June 2008. We’ll also provide Rs 15 crore to the Orissa Government for the improvement of the present 100-km long Cuttack-Paradip road.

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