KPT works on big projects to be of world standard
Sunday, February 10, 2008
KARACHI: The Karachi Port Trust has realised the changing shipping trend as large vessels are now calling at ports, which carry more goods and save freight charges. To keep in line with the global trend, the KPT has started Pakistan Deep Water Container Port, the deepest port in the region and a very large project consisting of 10 berths.
The KPT has signed an agreement with Hong Kongs Hutchison Port Holdings on build, operate and transfer (BOT) basis for the first four berths of the Deep Water Port. This is phase one of the project, whose total area exceeds five kilometres, and there might be two other phases.
These things were shared by Karachi Port Trust Chairman Vice Admiral Ahmad Hayat in an exclusive interview with The News, in which he discussed various plans and projects of the KPT.
He stressed the need and importance of the project, saying all over the world the shipping trend was changing. Previously, smaller vessels were coming to ports, but now larger and larger ships are being manufactured in various parts of the world. Therefore, we realised that getting larger ships will help the economy because on these vessels more goods can be loaded. In this case, freight charges will drop substantially as these days fuel prices are high so freight is high.
At present, large vessels go to Dubai, Kandla, Mumbai and Colombo ports and from there smaller feeder vessels come to Pakistan, resulting in double handling charges and high freight. He said our motive is to bring mother vessels to Karachi port and avoid feeder vessels, which can be sent from Karachi to the eastern African coast, to the Indian coast and even to Colombo.
We are making the deepest port in the region which will be 18 metres in depth. At present, the deepest container vessel is about 15.5 to 16 metres which has been built by Maersk Line, which has 22 to 23 per cent share in the worlds container shipping.
Maersk Line has made six big ships, three more are in the pipeline, which are called E-type ships that carry 13,000 to 14,000 TEUs (twenty feet equivalent units). There are only a few ports in the world which can handle these vessels. Shanghai and Hong Kong are among those ports, but Dubai cannot handle these large vessels.
Therefore, we are hoping that once this project (Deep Water Container Port) comes up, we will be one of the few ports in the region which will be able to handle these vessels. In the first phase of the project, which may take 60 years, the KPT will not dig up 18 metres, but it will be 16 metres as dredging is very expensive. Once demand comes in and larger vessels call at the port, then dredging will be extended to 18 meters.
That would bring a lot of transshipment business, he said, adding the vessels would come here and unload their containers and from here feeder vessels would take the goods to third country. At present, we only handle that cargo which the country imports or exports.
Another major project of KPT is Cargo Village, which is on the western side and a bridge will be built to connect the Deep Water Port with the village. The Cargo Village will be constructed in three phases and the first phase will cover 1,300 acres and it has been designed by German designers.
Ahmed Hayat said we have floated a tender for dredging of the Deep Water Port along with dredging for Cargo Village. The tender covering the two projects will be awarded to one company in order to cut cost.
The Cargo Village, which will also serve as an industrial complex like in China, will have a 600-metre quay wall at a depth of 16 metres. The Deep Water and Cargo Village are dependent on each other. The Cargo Village will also be linked with National Highway as we are making roads to connect the village to Lyari Expressway and Northern Bypass. Similarly, we are also laying a railway track which will connect the railway to the national grid so whatever cargo comes to the Deep Water Port, through the bridge it will land into the Cargo Village and from there can go to its final destination, Ahmed Hayat said.
In Cargo Village, only infrastructure will be developed by the KPT and the private sector will be invited to do other development work. In this project, the KPT will bear a cost of nearly $200 million.
He said the connect bridge was a very expensive project, which was being designed by a German agency. We are looking to arrange $600 to $700 million for the bridge as we may not be able to make the bridge on our own, so we are talking to Japan Bank of International Credit.
The timeframe for completing work on the bridge is four to five years and it will be a very high bridge because vessels will cross underneath it. In the case of Deep Water Port, he said, first dredging would be done to 16 metres, second marine protection work would be undertaken and third 1,500 metres quay wall would be built.
We are looking to provide $600 to $700 million of KPT money and around $400 million private sector money, together this will be around $1 billion in these three projects. About competition with Gwadar deep water project which has a depth of 14 metres, but not as deep as KPTs deep water project, he said there was great market demand, so the Gwadar project would not hamper the business of KPT as container traffic growth in the international market was about 13 to 15 per cent annually.
We are trying to make KPT as user-friendly as possible and all projects and policies which are initiated are all on market demand. We are trying to change work culture and automate things in a big way and one of the examples is the wharfage payment system, Ahmed Hayat concluded.
KPT works on big projects to be of world standard