Visakhapatnam Port
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Visakhapatnam Port, known as Vizag Port for short, is an ancient port located in east central India that began operating in 1933. As of 2021, the port has a total annual cargo capacity of 125 million tonnes.[1] The port was once the busiest in India, but has fallen to third place in terms of cargo handling due to competition from the Adani-owned Gangavaram Port, which is located just 15 km away.[2]
The port has increased its annual coal handling capacity to 25 million tonnes through modernization and expansion of its berths, but has recently experienced a decline in coal traffic relative to other Indian ports, due to competition from the rapidly expanding Paradip Port[3] and decreasing demand for imported coal.[4]
Location
Background
As of early 2015, three companies were processing coal at Vizag Port, with an estimated combined capacity of 25 million metric tons.[3] Two multi-commodity berths operated by VSPL (Vizag Seaport Private Limited), commissioned in 2004-05 with a total annual capacity of 9 million tons,[5] have recently been joined by Vedanta's newly mechanized Vizag General Cargo Berth (VGCB), commissioned in 2013 with a capacity of 10.7 million tons[6][7][8][9] and Adani's Vizag Coal Terminal Private Ltd, completed in December 2013 and engaged in pre-commissioning trial runs in 2014, with an annual capacity estimated between 5 and 6.4 million tons.[10][11]
A fourth project, the SEW Vizag Coal Terminal Private Ltd berth at East Quay 1A, with a capacity of 7.36 million tons, was scheduled for completion in 2014[12] but has seen its commissioning delayed [13] and ultimately canceled in 2017.[14]
Vizag Port's imports of both thermal and coking coal suffered declines between April 2013 and January 2014, even as India's other coal ports were experiencing significant growth. As reported in the Times of India, a senior shipping executive attributed the dropoff in exports partially to competition from Paradip Port, which recently deepened its harbor to receive large vessels.[3]
In 2017, coal operations at Vizag Port suffered significant additional setbacks, including a complete stoppage of work at the coal berths operated by SEW Infrastructure and Adani.[15]
In March 2017, India's National Green Tribunal (NGT) ordered Vizag Port to reduce coal dust emission from the port and improve air quality by the end of 2018. The NGT's decision, in response to a public interest lawsuit filed by the women's group Chaitanya Sravanthi, called for the port to submit quarterly reports starting in June 2017 to enable the agency to better monitor pollution levels at the port. If pollution is not brought under control, the NGT indicated that Vizag Port's coal operations might have to be moved elsewhere.[16]
In May 2017, Vizag Port announced that it was scrapping its deal with SEW Infrastructure for development of the East Quay 1A coal berth, due to SEW's failure to complete work within the stipulated period.[14] SEW had originally agreed to complete construction of the 7.36-million-tonne berth by October 2014 but as of 2017 had only completed 60% of the work. Vizag Port announced that it would spend ₹100 crore to complete work on the berth, with plans to either operate the berth directly or find a new business partner. Due to low demand for steam coal, the new berth may ultimately be developed as a multi-commodity terminal.[17] India's Ministry of Shipping has approved Vizag Port's plans for redevelopment of the berth.[18]
In December 2017, Vizag Port announced that it had also canceled its contract with Adani for the 6.41-million-tonne Adani coal berth, citing Adani's failure to operate the berth and pay its agreed-upon revenue share. Adani, whose coal operations at the port have been indefinitely shut down in response to pollution concerns, has stated that it is not in a position to operate the berth, prompting Vizag Port to consider developing the berth on its own as a multi-commodity terminal or finding a new partner to resume operations at the berth.[4] As of April 2021, Vizag Port was still planning to convert the Adani coal berth into a multipurpose cargo port, but development had not yet begun.[19]
ALBA Asia Private Ltd. also considered developing a 6 mtpa coal terminal at the Vizag Port, but this proposal was scrapped as well. The three public-private partnership terminals at Vizag Port - Adani, SEW, and Alba - had invested a total of ₹2,500 crore (approximately US$325 million) in the failed projects. Other private terminal operators at the port were also struggling due to the tariff structure imposed by Visakhapatnam Port Trust.[20]
In 2019-20, the Vizag Port imported about 9.27 MT of steam coal and 0.82 MT of thermal coal, but in 2020-21 coal volumes dropped to 5.07 MT and 0.70 MT, respectively. Part of the decline was due to the Union government discouraging import of steam coal to encourage local mines.[21]
Project Details
- Operator: Visakhapatnam Port Trust (VPT)
- Existing Capacity (Tonnes per annum): 19.7 million
- Retired Capacity (Tonnes per annum): 6.41 million
- Additional Proposed Capacity (Tonnes per annum): 13.36 million (cancelled)
- Status of expansion: Cancelled
- Type: Imports
- Projected in service:
- Cost of expansion:
- Financing for expansion:
- Coal Source:
Articles and Resources
Sources
- ↑ Chairman's Message, Visakhaptanam Port Authority, Accessed November 2021
- ↑ Visakhapatnam Port, Wikipedia, Accessed November 2021
- ↑ 3.0 3.1 3.2 "Route rationalization, political uncertainty hit coal traffic at Visakhapatnam Port Trust" The Times of India, February 13, 2014.
- ↑ 4.0 4.1 "VPT to scrap concession agreement with Adani" The Hindu, December 5, 2017.
- ↑ "Vizag Seaport Private Limited" Gammon Infrastructure website, accessed February 2015.
- ↑ "Vizag Port set to become a hub for imported coal" The Hindu, April 22, 2014.
- ↑ "Vizag Port takes up mechanisation at Rs 444.1 cr" Infrastructure Today, May 2013.
- ↑ "Essar beats Vedanta to bag VPT OHC project" The Times of India, May 30, 2013.
- ↑ "About Us" Vedanta website, accessed February 2015.
- ↑ "Adani Ports completes Rs 400 crore coal import terminal at Vizag port" NDTV Profit, December 18, 2013.
- ↑ "Adani starts trial runs at Vizag coal terminal" The Hindu, July 16, 2014.
- ↑ "VPT signs agreement to develop EQ-1A berth" The Hindu, February 5, 2012.
- ↑ "Three VPT projects run into delays" The Times of India, November 24, 2014.
- ↑ 14.0 14.1 "Vizag port scraps deal with consortium" The Hindu, May 11, 2017.
- ↑ "A mixed bag for the industry in North Andhra region" The Hindu, December 25, 2017.
- ↑ "Vizag Port, PCB told to control coal dust" The Times of India, March 14, 2017.
- ↑ "SEW berth: VPT to invest ₹100 crore " The Hindu, June 19, 2017.
- ↑ "Tough Time Ahead for VPT" The Hindu, June 26, 2017.
- ↑ Multipurpose cargo berth at Vizag port, Times of India, Apr. 9, 2021
- ↑ BOT Operators at VPT demand policy reforms from Ministry of Shipping; seek effective utilization of port infrastructure, The Free Press Journal, Sep. 28, 2021
- ↑ Sumit Bhattacharjee, VPT grosses up 69.84 million tonnes in 20-21, The Hindu, Apr. 4, 2021
