Company to be called by KPT Board of Trustees for a presentation.
The decision to award a green field cargo port project by Kandla Port Trust (KPT) to the private sector port developer, Mundra Port and Special Economic Zone Ltd (MPSEZ) has been put on hold for at least next 10 days. The board of trustees of KPT, at their meeting held on Monday, had raised concern about the timely execution of the project by MPSEZ, which is a competitor of KPT in the port operations. It may be mentioned here that MPSEZ changed its name to Adani Ports and Special Economic Zone Ltd on Monday.
KPT, which is aiming to set up a satellite port near Mundra with an estimated investment of Rs 1080 crore, had invited bids for the project. MPSEZ had emerged as a highest bidder for the project, which is to be constructed under the built-operate-transfer (BOT) contract.
"About 80 per cent of the trustees expressed concern about the timely execution of the project by the private sector ports operator as they too have operations at Mundra, barely 60 kms away from Kandla," said a member of board of trustees, requesting anonymity.
"Timely completion is the sole concern for the trustees. Within a week's time, MPSEZ would have to make a presentation before the board of trustees on how they intend to execute the project in a time-bound manner. A special meeting of the board of trustees will be convened over the next 8-10 days to take a final call on the project," the trustee said.
At Kandla port, the country's largest port with cargo handling of more than 81 million tonnes in April-March 2011, the draft is a major challenge. Hence, nearby ports are being developed as satellite ports.
"The decision to award the project would decide the growth of KPT for the next 50 years. If the project partner successfully completes the project in a time-bound manner, KPT may emerge stronger in the region. While, MPSEZ too has its business interests in port operations, so there are apprehensions about the timely execution of the project," said the trustee of KPT.
Even as twelve companies had filed RQF for the project, only two companies including MPSEZ and IMC, formerly known as the Indian Molasses Company had submitted their bids, which were opened last week. MPSEZ emerged as the highest bidder by quoting 25.09 per cent operating revenue share, while IMC quoted operating revenue share at 3.3 per cent.
"Only two bids were submitted and the difference between the two is very high. The offer by MPSEZ is very attractive and trustees do not want to lose on this opportunity," one of the trustees of KPT said.
An emailed query to MPSEZ regarding company comments, remained unanswered.
The port will have a 'T'-shaped jetty with 15 meters draft at the front and 14 meters draft at the back. The bulk cargo handling terminal, will have a cargo handling capacity of 14 million tonnes per annum.
Kandla port has proposed a 30-year concession period for the port developer with two years for construction phase, which 28 years of operations.
