Ports Ministry to present Cabinet paper on ECT development

Friday, 24 August 2018 00:00 - - {{hitsCtrl.values.hits}}

Govt. grants approval to Ports Authority to run the ECT
Ports Authority to procure equipment for the development of the Terminal
Equipment to be leased till procurement is delivered to bring the Terminal to functionality as soon as possible

By Chathuri Dissanayake

Port and Shipping Ministry is preparing to present a Cabinet paper for procurement of equipment needed to operationalise the East Container Terminal, set to be managed by the Sri Lanka Ports Authority (SLPA), utilising its own funds.

Denying reports that the ECT was to be managed as a Public-Private Partnership, subject Minister Mahinda Samarasinghe, speaking at a press conference held at the Sri Lanka Freedom Party Head Office yesterday, said that the Cabinet has given approval for the Terminal to be managed by the Ports Authority.

The National Economic Council and Cabinet of Ministers have both decided to have the SLPA manage the ECT to ensure “continuity and financial viability of the Ports Authority”, Daily FT learnt. According to sources within the Ports Authority, initial investment was estimated to be $ 100 million under Phase 1 of development.

Following the decision, the Ministry is now ready to go ahead with the much delayed development of the ECT.

“Colombo International Container Terminals (CICT) is the only deep-water terminal able to receive large container ships. It has not reached its capacity, and we need ECT running as soon as possible,” Samarasinghe said.

The Minister is expected to present a Cabinet paper seeking approval to appoint a negotiating committee and technical evaluation committee to proceed with procurement of equipment needed to operationalise ECT under Phase 1 of development.

Further, the same Cabinet paper will also seek approval for leasing of equipment needed to commence work in ECT until the permanent equipment can be procured and delivered, the Minister said.

“The equipment under Phase 1 of development of the project will only be delivered 15 to 20 months after the order is placed. But, since we need to start receiving ships in the Terminal as soon as possible, we will be leasing the equipment needed to operationalise the Terminal so that we can start work as soon as possible,” Samarasinghe said.

According to the master plan of the Colombo Port Expansion Project (CPEP), the East Container Terminal has a 1,200m-long quay wall, alongside water depth of 18m and a yard capacity of 2.4 million TEUs.

The Government, on earlier occasions, had attempted to form a consortium to manage the ECT with preference given to a partner from the Indian subcontinent. The preference to have a partner from the subcontinent was largely viewed as an attempt to neutralise the growing Chinese presence in Colombo Port.

The Chinese firm China Merchants Port Holdings Company Ltd. already manages CICT, having a 35-year build-operate-transfer basis with 85% share ownership.

Although Cabinet appointed negotiation committees and technical evaluation committees, the deal did not fall through.