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New port projects run into rough weather in Gujarat

New port projects run into rough weather in Gujarat
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First Published: Mon, May 16 2011. 12 56 AM IST
Updated: Mon, May 16 2011. 04 31 PM IST
Ahmedabad: Vansi Borsi, a proposed port in Gujarat, will relocate to a new site more than 15 years after it was conceived because the nation’s biggest oil explorer said it wouldn’t move an undersea gas pipeline, making the project unviable.
This is one of at least 12 port projects in Gujarat that have failed to take off because of protests over land acquisition, environmental objections and technical problems, making it difficult for the state to achieve an ambitious plan to dot its 1,600km coastline with a string of harbours at an estimated cost of at least Rs.20,000 crore.
Gujarat Maritime Board, which regulates ports in the state that are not owned by the Central government, has invited bids from consultants to draw a fresh project feasibility report for Vansi Borsi, 30km south of Surat city.
“Development of a port is market-driven and what was feasible a few years ago may not be so today,” said Suren Vakil, managing director, BMT Consultants (India) Pvt. Ltd, a ports consultant. “A port like Vansi Borsi, which was conceived as a chemical terminal port about two decades ago, might currently be more suitable for a container terminal facility. The feasibility report should ideally take into account a detailed social impact of the project, but it is not always practical.”
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There was little alternative to relocating Vansi Borsi after Oil and Natural Gas Corp. Ltd refused to shift the undersea pipeline transporting gas from the Bassein field that passes through the area, said a government official familiar with the development. The company didn’t want to move the pipeline because any such shift would have involved high cost and disrupted supplies. Apart from the cost of shifting the pipeline, the company also has to secure several permissions from government departments, both Central and state governments, ONGC has communicated to the Gujarat ports regulator in the past.
Chennai-based Creative Port Development Pvt. Ltd won the rights to develop the Rs3,000 crore port project in 2008. The regulator will select a new developer through a bidding process, the official said, requesting anonymity.
Gujarat tops the list of eight coastal states in India with planned investments of Rs74,240 crore in the next 10 years for developing ports, according to a recent report by Press Trust of India, citing an unidentified shipping ministry official.
So far, the port sector, including private jetties and shipyard projects, has seen an investment of Rs25,000 crore, according to an official at the state’s ports regulator, who declined to be named.
Gujarat Maritime Board, which regulates 41 ports, had invited fresh bids for a port project at Nargol after it was forced to shift the location from nearby Maroli after facing protests from local fishermen, who feared their livelihood would be hurt.
A spokesperson at Gujarat Maritime Board did not respond to calls made to his mobile phone.
Currently four ports in the state are operated by private firms. These include Pipavav port (operated by APM Terminals’ Gujarat Pipavav Port Ltd), Mundra port (Adani Group’s Mundra Port and Special Economic Zone Ltd, or MPSEZ), Dahej port (Petronet LNG Ltd) and Hazira port (Hazira Port Pvt. Ltd, a joint venture between Shell Gas BV and Total Gaz Electricité Holdings France).
Another such project that has received a setback because of local protests is at Mahuva near Bhavnagar where Nirma Ltd plans to set up a cement plant. The company had proposed to set up a Rs550 crore port project to handle exports from the plant. The cement plant is facing a legal challenge and the port project has been stuck, said the government official quoted earlier.
The Rs50,000 crore Kalpsar dam project with an aim to provide water to the Saurashtra region of Gujarat, has forced the government to look for an alternative sites for the Adani Group’s Dholera project and Infrastructure Leasing and Finance Services Ltd promoted Khambhat port. “We have been informed by the state that an alternate location would be given to us instead of Dholera,” said R. Ravi, chief financial officer of MPSEZ.
Developers of thermal power plants in the state are also setting up ports to make it easier for them to transport raw material such as coal for their power plants.
Larsen and Toubro Ltd (L&T) and Shapoorji Pallonji and Co. Ltd owned Afcons Infrastructure Ltd were earlier chosen to develop the Sutrapada and Simar ports, respectively, by the state. While L&T, which is setting up a 2,000MW power project in the area, faced protests from environmental activists, Shapoorji Pallonji, which is also planning a power plant in the state, found that the seabed in the area was not conducive to construct a port, said an official at the state ports regulator, requesting anonymity. L&T has been allotted a new port site at Shivrajpur near Dwarka, at least 200km from the earlier location, while Shapoorji Pallonji has been allotted a new location at Chhara, at least 20km away from Simar, where it has begun land acquisition.
Positra port near Dwarka has failed to take off for more than a decade as it falls in the national marine park sanctuary area. The project was conceived by Nikhil Gandhi-controlled Sea King Infrastructure Ltd. The developer later roped in Port of Rotterdam, Europe’s largest, for the project.
There are at least four other ports in the state that have failed to start operations as the government did not select developers for locations like Porbandar, Modhawa, Bedi and Mithivirdi, said a government official, who declined to be identified.
Singapore-based Universal Success Enterprise Ltd planned an 10,000MW power plant at Bhogat near Jamnagar. Its proposal to build a port to handle coal met with local opposition on land acquisition and the company had to identify a new location, chairman Prasoon Mukherjee said.
maulik.p@livemint.com
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First Published: Mon, May 16 2011. 12 56 AM IST
More Topics: Vansi Borsi | Port | Shipping | Cargo | Ships |