The Hindu Business Line : Mega box terminal at Chennai port to cost 21% more

The share of the port trust in the project will triple to about Rs 1,600 crore and the balance will be brought in by the private operator, says the port trust Chairman, Mr K. Suresh.

T.E. Raja Simhan

Chennai, Oct 9 The cost of the Mega Container Terminal at Chennai port has increased by nearly 21 per cent to Rs 3,686 crore with the Chennai Port Trust (ChPT) deciding to ‘review and modify’ the modality structure of the project. The original cost was Rs 3,050 crore.

The increase is mainly due to dredging, which will now be taken up by the ChPT instead of the private operator. The share of the port trust in the project will triple to about Rs 1,600 crore and the balance will be brought in by the private operator, according to the port trust Chairman, Mr K. Suresh.

In the new project structure, the ChPT will construct the breakwater costing around Rs 1,000 crore. This is in addition to Rs 600 crore, to be spent by it on dredging, reclaiming of land and providing tugs. The private operator will take care of the landside investment on the berth such as equipment.

Mega terminal

The ChPT is constructing the mega container terminal to handle four million TEUs a year under build, operate and transfer (BOT) basis. The Chennai port handled 1.12 million TEUs in 2007-08. A report of the task force of the Planning Commission on “Financing Plan for Ports” estimates the container traffic through Chennai to be 1.67 million TEUs in 2011–12. DP World currently operates a private terminal, and PSA-Sical will run a competing terminal from mid-2009.

Tender

The ChPT on Thursday invited a tender for “Providing Transaction Advisory Services for Development of Mega Container Terminal in Chennai Port under the PPP mode.” The bidders must have experience in providing technical/financial advisory services in India for development of projects in the infrastructure sector such as ports, port services, road, highways and expressways under the PPP model (BOT/BOOT).

The bidder must have office in India and should have worked closely with the Government entities. The bidder should have completed at least one such assignment in India (like the mega terminal) in the preceding seven years for a project costing more than Rs 500 crore.

The bidders should possess experience in financial analysis of projects, project structuring, preparation of bid documents, including concession agreement, managing the bidding process and providing assistance in selection of successful operators for the above mentioned sector projects, says the tender.