Chennai mega terminal project off shipping min list

The Rs 5,000-crore project has been delayed due to various reasons besides poor private sector participation

After failed attempts to get the Chennai Mega Container Terminal up and running, the  shipping ministry has taken off the project from its list of targets this year.

The four million twenty-foot equivalent unit (TEU) capacity terminal project was conceptualised in 2006. However, the project received only two bids from a consortium of Vadinar Terminal Ltd and Essar Port (VOTL), and Adani Port Special Economic Zone (APSEZ). VOTL’s winning bid of 5.25 per cent revenue share was considered very low for Rs 5,000 crore project.

"We have been promising to award it year after year, but it has been a very complicated process. So, this year we are not including it. If it happens, it will be a bonus,” a senior shipping ministry official said.

The Chennai Port Trust has commissioned a fresh study by a consultant on the project, before it is put up for a re-bidding. The project has been delayed due to various reasons besides poor private sector participation. Initially, Adani port’s bid was rejected due to its failure to get security clearance.  

The shipping ministry has also showed concerns over the structuring of the project. "It is a capital-intensive project and requires construction of breakwater. This work has to be done by the port trust not the private operator," the senior official said.

While the project has been delayed, its cost has gone up from earlier estimates of Rs 3,800 crore to nearly Rs 5,000 crore. The competition around the port has also increased with non-major ports like Katupalli being developed closeby. The shipping ministry has set a target of awarding 30 projects to add a capacity of approximately 300 million tonne in 2013-14.

The mega container terminal will have two new breakwaters (total length 4.5 km) and a continuous quay length of 2 km, which will ultimately have 22 metre alongside depth to handle ultra-large container ships of over 15,000 twenty-foot equivalent unit capacity and 400 metres long. It is to be developed north of the existing Bharathi dock.