EAC recommends green clearance for Dhamra port expansion in Odisha

Dhamra, a deep draught port off coast of north Odisha needed 800 acres of land in second phase purely for port operations

The expert advisory committee (EAC) of the Union ministry of environment & forests (MoEF) has recommended environment clearance for Dhamra port's second phase expansion.

Dhamra Port Ltd is an equal joint venture between the Tatas and L&T.

The port has lined up an investment of Rs 10,000 crore to augment capacity to 100 million tonne per annum (mtpa) from 25 mtpa. In the second phase, the port aims to handle diversified cargo.

“The EAC has already recommended our case for environment clearance to MoEF for Phase-II expansion. Now, we are awaiting the final nod from the ministry”, said Santosh K Mohapatra, chief executive officer, DPCL.

Dhamra, a deep draught port off the coast of north Odisha, needed 800 acres additional land in the second phase purely for port operations.

The state commerce and transport department had earlier stipulated three conditions to lease out the land.

First, the port has to achieve capacity utilisation of 70 per cent of Phase-I in accordance with clause 4.4 of the concession agreement.

Second, it has to obtain environment clearance from MoEF for the proposed expansion. Third, DPCL has to get a no-objection certificate from the National Green Tribunal (NGT) for expansion of port limits.

Of late, the government is understood to have done away with the capacity utilisation norm.

Land allotment for the port would be done in accordance with a 'thumb rule' prepared by Rites Ltd, the engineering and consultancy arm of the Indian Railways.

Rites had suggested allotting 50 acres land for every million tonne of cargo handling capacity proposed by a port developer.

Dhamra port which began commercial operations in May 2011 has been hit hard by curbs on iron ore exports.

Along with a steep export duty of 30 per cent, a resolution of the state government making it mandatory for standalone miners to sell at least 50 per cent of their extracted ore to local industries had impacted the port operations.

The port closed FY13 with a total cargo traffic of 11.07 million tonne (mt), 119 per cent more than 5.06 mt handled in 2011-12. The cargo growth was driven by robust imports of limestone and coking coal totalling to 8.72 mt. Exports in 2012-13 stood at 2.35 mt.

The port presently operates two berths with a combined capacity of 25 million tonne per annum.

Realizing that iron ore traffic is unlikely to be its growth driver given the current clampdowns on exports, Dhamra port had drawn up its next phase capacity augmentation plan.

The expansion will raise the port's berth strength to 13 with a focus on handling of container cargo, liquid cargo, LNG (liquefied natural gas) and crude oil.