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APMT Pipavav revises expansion plan

APMT Pipavav revises expansion plan
Work will include strengthening the existing Berth 3

The Board of Directors of Gujarat Pipavav Port Ltd. (APM Terminals Pipavav) have revised the port’s expansion plan that envisaged an increase in container handling capacity from the present 850,000 teu to 1.35m teu, a downward revision on the original planned increase of 1.5m teu.

The revised Capital Expenditure (Capex) of INR 4,600m (US$66m) will be phased to include strengthening the existing Berth 3 and dredging berth pockets.  In addition, three new post Panamax cranes will be purchased to replace three existing Panamax cranes.

The plan also allows for the phased development of the container yard, along with the purchase of four rubber tyred gantry (RTG) cranes; the development of internal roads and gate complex and upgrading of electrical and other allied works.

Work on the initial plan, based on the Environmental Clearance (EC) obtained in June 2012, was scheduled to commence in October last year; it was timed to sidestep the monsoon season, which prevents large-scale construction/dredging.

However, the subsequent reissuance of the EC immediately proceeded the 2014 Monsoon season and an internal assessment forecast an inordinate delay if the initial plan was to be implemented as originally agreed.  This would have had commercial implications on the container business, which is presently near 80% utilisation.

As a result, various scenarios were explored and the new plan to strengthen the existing jetty and provide new cranes evolved.  Modification of the existing jetty only allows expansion up to 1.35m teu, a position justified by the fact that nearly the same capacity as originally planned is being made available within the same timeframe and at around half the cost of the initial plan.  The expanded capacity will now come on stream in Q1 2016 rather than Q4 2015.

APM Terminals Pipavav has also said that the port’s bulk capacity will remain constant at 4-5m tonnes as oppose to its earlier plan of increasing tonnage to 20m tonnes.  However, the company has not ruled out further expansion of container, bulk or liquid bulk (currently 2m tonnes) facilities based developing market conditions.