India's Tuticorin Port Receives Expressions of Interest for 250-Megawatt Thermal Power Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--The Tuticorin Port Trust (Tuticorin, Tamil Nadu) has received expressions of interest from Coal & Oil Company LLC (Dubai, United Arab Emirates) and Madras Cement Limited (BSE:500260) (Chennai, Tamil Nadu) to develop a 250-megawatt thermal power plant on Hare Island. The expressions of interest came in response to a tender floated in November 2008 to develop the $238 million power project.

About 80 acres of land have been allocated for the plant. A detailed project plan will be prepared and submitted to the government. On receiving consent, the port trust will proceed with the request for proposal and Request for Qualification stage. Hare Island is a narrow strip of land that lies next to the port. The island has a 1-kilometer waterfront and is fully secured by the port trust. The island is suitable for industries that involve large cargo movement, as these companies can utilize the port facilities available in the vicinity.

The Tuticorin Port Trust is also planning to develop additional facilities, such as cold storage units, container terminals, and an oil refinery. The investments will vary depending on the size and nature of the project. The oil refinery is estimated to cost about $495 million, while the cold storage plant will entail an investment of $99 million. The port trust is also considering allocating 150 acres of land to companies on the basis of a long-term lease. Land reclamation is being carried out and more than 247 acres of land will be available for industrial and commercial use in two to three years.

The port trust has also embarked on a $1.02 billion infrastructure and capacity augmentation program. The government has approved plans to develop the outer and inner harbors in Tuticorin port. The projects, executed under a public-private partnership, will be completed by 2012. The outer harbor project will involve the development of two coal terminals, a cargo terminal, an oil terminal, and two or three container terminals. The inner harbor infrastructure expansion, costing about $185.3 million, will involve dredging, draft deepening from 10.7 meters to 12.8 meters to accommodate ships of larger capacities, and the construction of a coal berth. The dredging, costing about $106 million, will be completed in 18 months, which will enable the port to handle vessels with capacities of 3,000-4,000 20-foot-equivalent units (TEU). The port presently handles ships with a capacity of 2,000 TEU. Additionally, the facility will also be able to increase its dead weight ton (DWT) capacity from the current 50,000 DWT to 70,000 DWT, which is expected to result in cost reductions for shipping companies.

In 2008-09, the cargo traffic at the Tuticorin port increased by 2.4% to 22 million tons compared with 2007-08. This year, the port has already handled 20.01 million tons with container capacity of 401,071 TEU to date. The port is expected to handle cargo traffic of 50 million tons by 2011-12, and of 100 million tons by 2020. While timely completion of the current expansion plans is critical, the port trust will also have to develop a strategy to increase infrastructure capacity to meet future needs.

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