Singapore’s PSA International has won the bid to construct and manage a US$1.3bn fourth container terminal at India’s Jawaharlal Nehru Port Trust (JNPT), near Mumbai, offering a 35.9% revenue share to the port.
The project will be awarded on a design, build, finance, operate, transfer (DBFOT) basis.
The company’s only competition was Adani Ports & Special Economic Zone, offering a 29% revenue share, despite the fact that five other parties qualified for the bidding process: DP World, ICTSI, APM Terminals (APMT), Sterlite Ports and United Liner Agencies (ULA).
It has been reported that some bidders were concerned about being able to raise enough money for the project, while ICTSI and ULA were having issues with security clearances. There were also concerns about last-minute design changes and renewal of environmental clearance by the government.
The company’s successful bid comes two years after it walked away from the same project citing problems with its partner company ABG Ports.
The operator’s winning bid this time was significantly lower than the 50.82% revenue share offered first time around, which was the highest revenue share ever offered in an Indian public-private partnership port project.
The industry as well as other bidders had expressed reservations about JNPT allowing PSA to take part in the second tender.
The company already runs a terminal at Chennai and has a 62% stake in another at Tuticorin; in addition, it recently secured an operating contract at Kolkata Port.
The port is India’s largest and handles roughly half of the total container traffic. The new terminal will have 2,000 m of berthing space and add 4.8m teu of annual capacity, more than doubling the current 4m teu capacity.
The other three terminals are operated by the port and in public-private partnerships with DP World and APMT respectively.
Last year the port saw throughput of just over 4m teu, representing a year-on-year drop of 2.9%.