Week ending May 24, 2003

News on Shipping

GE Shipping to invest $175 in fleet expansion :Great Eastern Shipping Company Ltd., has planned a massive $175 million fleet expansion programme with plans to acquire five new tanker vessels with a combined capacity of 4.5 lakh dead weight tonnes (dwt), three of which to be delivered in the next three years. These will comprise of one Suezmax, two Aframaxes and two more product tankers. The company has already taken delivery of an Aframax tanker and a product carrier. A mix of internal accruals and debt will fund the acquisition. The liquid bulk fleet of the company - 22 tanker vessels and 10 bulk carriers constitute79 percent of GE fleet, is focused on energy transportation as its core business. The fleet acquisition plan follows withdrawal of GE from the race for acquiring strategic stake in the SCI, also a major player in energy transportation sector in India.

New shipping secretary : Mr. D.T.Joseph, formerly Director General of Shipping and currently Secretary in the Union Cabinet Secretariat is assuming charge from June 1 as the Secretary (Shipping) to the Union Ministry of Shipping. He replaces Mr. M.P. Pinto, who is retiring from the post.

News on Ports

KoPT tenders to build floating terminal at Sandheads: Kolkata Port Trust (KoPT) has invited expression of interest (EOI) from private parties to build transloading facility and floating terminal at Sandheads. Sandheads offers 50-metre deep draft, which is the highest amongst all major ports. The draft permits mid-stream loading of dry bulk cargo through transloading. As per KoPT plan, smaller vessels would shuttle between transloading ship and floating terminal for transportation of cargo to Kolkata and Haldia. The project would be taken up on build-own-operate (BOT) basis.

Krishnapatinam Port Company to undertake dredging : Krishnapatinam Port Company Ltd., has invited tenders from interested dredging companies for undertaking dredging and maintenance of the approach channel to -4.5 m CD at the Krishnapatinam minor port in Nellore district of Andhra Pradesh. The estimated volume of capital dredging is expected to be about 200,000 cubic metres, with July-August as the dredging period.

News on Logistics

Concor to start Delhi-Chennai service: P&O Ports (India) is reportedly negotiating a proposal with Container Corporation of India (Concor) to launch a dedicated rail service between Tughalakabad and Chennai to divert the East-bound box cargo from congested Mumbai sector to Chennai in a bid to make the latter a hub port on the East coast. The Delhi-Chennai rail service will boost the box traffic at Chennai port and lure the box traffic away from JNPT, presently experiencing severe congestion. At present, there is a huge cost differential of over Rs.7,000 in domestic freight haulage charges, with shippers preferring to move their cargo through the Nhava Sheva port, despite Chennai offering a advantage of 4.5 to 5 days saved in transit time for East-bound cargo. The international shipping freight costs for East-bound cargo being more or less same from both the Nhava Sheva and Chennai, the critical factor that can bring about re-distribution of the existing box cargo market shares of these ports, is the leveling of the cost differential in domestic freight. This is especially true for traffic originating from North India.

Concor to set up ICD at Tiruppur: Concor is planning to set up an Inland Container Depot (ICD) at Tiruppur and has already obtained the necessary approvals. The proposed facility will be built on a four acre plot and will consist of warehousing space, administrative building, railway linkage and other such infrastructure facilities. The estimated cost of the project is around Rs.1.5 crore. Concor has estimated traffic of 200 TEUs from Tiruppur city alone, besides attracting cargo from surrounding cargo hinterland to be moved to Tuticorin and Cochin ports. Concor is also planning to relocate its existing Coimbatore ICD to Irugur at a cost of Rs.45 crore by end of 2003.