In May, APMT won the right to bid on the new terminal after regulators had prevented some existing operators at the port from bidding on future projects. But after receiving the tender document, APMT became worried that costs to build the two-phase terminal had increased beyond the concession’s financial feasibility,
“When we received the tender documents, it became clear that the revenue side – determined by a TAMP stipulated handling tariff – would be insufficient to justify the project cost,” said Hans-Ole Madsen, APMT vice president business development, South Asia, Middle East and Africa
Madsen said APMT outlined its concerns over the tender document to the Jawaharlal Nehru Port Authorities, but was informed that a review wasn’t possible.”Should the government decide to revisit the primary tender conditions, we remain interested,” he said.
The new terminal project has been hampered by controversy and delays and the Port has been plagued by congestion as its terminals operate past their maximum design capacity. A project to deepen navigation channels to the port, enabling larger and more fully laden container vessels to call the key gateway, has also been delayed.
Increasingly container cargo destined to and from Northern India is moving through the Gujarati ports, as the rail capacity connecting Jawaharlal Nehru Port with North India is overwhelmed.
Madsen said the dredging issue not only affects development of the fourth terminal, but also the three existing terminals including APMT’s Gateway Terminals India, a joint venture with the state-owned Container Corp. of India.
“It’s a concern for the whole port, even our existing terminal,” he said. “Everybody recognises that for the port to stay competitive dredging needs to happen.”
The fourth terminal is to be constructed in two phases, with 1,000 m of quay in each phase. If fully built, the terminal could handle 4mto 4.5m teu, doubling container-handling capacity at the port. More than half of all container volume in India moves through the Nhava Sheva complex
In addition to the APMT action, CM has learnt that the JNPT4 tender has been held up by another court case. It appears that a consortium led by Mundra Port and Special Economic Zone Ltd, too, was denied clearance by the Union government to bid for the project. Although the group has challenged the decision in the Mumbai high court, the court has not yet admitted its petition or granted a stay on the auction, but has said that JN port can award the project only after the petition has been cleared.
The next hearing on the case is posted for July 4, 2011.