After sorting out of the teething problems, Visakhapatnam Port Trust is all set to issue Letter of Award to Vadinar Oil Terminals, part of Essar Group, to launch work on development and operation of three iron ore berths.
This will be the second facility being developed on the East Coast by Essar Group, one of the largest private sector port companies in India. It has already developed four berths at Paradip. By adding 23 million tonne in three years at Vizag, the Essar Group, a BSE and NSE-listed company, will have a total iron ore handling capacity of 39 million tonne per annum on the East Coast. It has terminals at Vadinar and Hazira on the West Coast.
A senior official of VPT told The Hindu that Essar Group, with which they had signed a concession agreement in 2013, would start work in a month. Once it shows upfront fee of around Rs.170 crore towards existing facilities in Escrow account, it will take possession of the existing infrastructure of Ore Handling Complex and the old berths.
As per the agreement, the Special Purpose Vehicle Essar Vizag Terminals Ltd will create the facilities to receive Super Capesize vessels with a capacity of 2,00,000 deadweight tonnage (DWT) in the Outer Harbour and Panamax vessels in the Inner Harbour under a mechanised loading environment.
Though the concession agreement put the cost of the project at Rs.845 crore, the figure is likely to be revised with mutual consent at a later stage due to delay in grounding the project. The work on the project is supposed to take off in 2014 itself.
VPT issued Letter of Award to Visakha Container Terminal Private Ltd (VCTPL) sometime ago to extend the existing terminal at a cost of Rs.633 crore. Both Essar and VCTPL projects are being launched under Build, Operate and Transfer basis as part of efforts to transform Visakhapatnam Port into a world-class port.
The cost mentioned in the concession agreement is likely to be revised owing to delay in grounding the project
