Port developers buy dredgers to cut costs, overcome shortages

Port developers buy dredgers to cut costs, overcome shortages
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First Published: Mon, Jul 14 2008. 11 17 PM IST

In short supply: Dredger Sospan Dau. Dredgers are in high demand for port expansion works worldwide.
In short supply: Dredger Sospan Dau. Dredgers are in high demand for port expansion works worldwide.
Bangalore: Private firms building new ports in India are buying their own dredgers to cut costs and speed up the channel deepening work at ports.
Dredging work at ports and harbours is carried out with dredgers. A spurt in port expansion projects globally, as well as the offshore construction and land reclamation works in West Asia, has led to a global shortage of dredgers and raised dredging costs significantly.
In short supply: Dredger Sospan Dau. Dredgers are in high demand for port expansion works worldwide.
This has started hurting port development plans in India where private firms are investing close to Rs65,600 crore over the next five years to boost port capacity for handling more cargo. About 95% of India’s external trade by volume and 70% by value moves by the sea route.
Hyderabad-based construction firm Navayuga Group, which is developing a new port at Krishnapatnam in Nellore in Andhra Pradesh, has purchased three dredgers, said M.K. Padia, chief executive officer of Krishnapatnam Port Co. Ltd. Navayuga has also hired Dutch dredging firm Van Oord Dredging and Marine Contracting Co. NV to deepen the port’s channel and berths.
The first phase of the port, to be inaugurated this week, will have a depth of 12m to start with.
“In a month, the depth of the channel will be deepened to 15.6m to enable bigger ships to call at the port,” said Padia.
The first phase is designed to handle 24 million tonnes of cargo a year. The port will have a depth of 19 metres when the third and final phase of its development is completed by 2012 and will be able to handle around 100 million tonnes of cargo.
Earlier, another infrastructure developer, Chennai-based Marg Ltd, which is building a port at Karaikal in Puducherry, had purchased a dredger to expedite the dredging work at the port, slated to start operations by March 2009.
“We are in the process of buying two more dredgers to carry out the work at the Karaikal port,” said Jayesh Bhat, chief operating officer of Karaikal Port Pvt. Ltd.
Essar Shipping, Ports and Logistics Ltd has also purchased a dredger for its own captive needs at Hazira port in Gujarat.
“The dredging market is so tight that you don’t get dredgers when you require them. Port developers are buying dredgers so that they can have them at their disposal without being driven by market forces,” said G.Y.V. Victor, deputy chief operating officer of International Seaport Dredging Pvt. Ltd, a joint venture between Larsen and Toubro Ltd and Dutch firm Dredging International NV.
According to Victor, the cost of dredging to create new ports and harbours and deepen the channels and berths of existing ports (called capital dredging) has gone up by 70-80% in the last five years.
“Currently, dredging costs about Rs160-200 per cubic metre, depending on the location, the type of material to be dredged and the distance from the dredging site to the dumping area,” said Bhat of the Karaikal port.
Most firms are buying dredgers from China as they are cheaper and more readily available .
India’s dredging sector was so far dominated by the state-run Dredging Corp. of India Ltd and small private firms such as the Kandla-based Jaisu Shipping Co. Pvt. Ltd.
But, these entities do not have an adequate dredging fleet to take up the increasing dredging works in India.
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First Published: Mon, Jul 14 2008. 11 17 PM IST