Saudi company to operate Patenga Container Terminal
Deal signing expected next week
Red Sea Gateway Terminal International (RSGTI) has been finally nominated by the government to operate the newly built Patenga Container Terminal (PCT) of the Chattogram port for 22 years.
The RSGTI is a sister concern of Red Sea Gateway Terminal (RSGT), operator of Saudi Arabia's largest terminal facility at Jeddah Islamic Port.
The Ministry of Investment of Saudi Arabia recently proposed that the Bangladesh government nominate the RSGTI instead of the RSGT, which was previously selected, said sources.
The Shipping Ministry of Bangladesh subsequently accepted the proposal, they said.
Senior port officials said they finalised negotiations with the company and sent a draft agreement to the shipping ministry for approval.
They hope for the agreement to be signed by next week upon getting approval from the cabinet committee on economic affairs.
Hailing the development, the port's users said the PCT needs to be made operational as soon as possible for the enhancement of the port's capacity.
According to sources, a memorandum of understanding was signed between the Saudi Arabia's Ministry of Investment and Bangladesh's Public Private Partnership Authority on October 28, 2021.
Later at a meeting on February 23, 2022, Bangladesh's shipping ministry proposed a public-private partnership (PPP) model to the Saudi government for equipping, operating and maintaining the PCT.
It was at that time that the Saudi government nominated the RSGT.
On March 11 this year, Bangladesh's shipping ministry and the RSGT signed a framework agreement on mutual cooperation.
On June 12, Chittagong Port Authority (CPA) sent a request through the PPP Authority asking the RSGT to submit their proposal in 45 days.
Though technical and financial proposals were submitted to the CPA on July 24, it was under the name of the RSGTI, which created some confusion.
The confusion was cleared when the Saudi government informed of having nominated the RSGTI.
The technical and financial proposals were provided a second time by the firm to the CPA on October 29.
Both the RSGT and the RSGTI are owned by the Saudi government and have almost the same shareholders, said CPA Chairman Rear Admiral Mohammad Sohail.
"The government of Saudi Arabia is the authority to select the company for operating the PCT and they finally selected the RSGTI," he said.
"…while our government selected the CPA to get the agreement signed for operating the terminal under a PPP model through a government-to-government (G2G) partnership," he said.
Guidelines of the PPP Authority are being followed every step of the way, pointed out the port chairman.
He hopes for an agreement to be signed with the RSGTI within the middle of this month.
The new terminal can be made operational within four months of signing the agreement, informed a senior CPA official.
Initially, small container handling equipment like mobile cranes, forklifts, reach stackers etc can be installed by the operator, he said.
The firm will get two years to purchase and install heavy equipment like quayside gantry cranes and rubber-tyred gantry cranes and only then the terminal will be fully operational, he said.
"The firm would be appointed to run PCT for 22 years. The initial two years is for installing the heavy equipment and these heavy machineries usually have a (economic) lifetime of 20 years," he informed.
After over 14 and a half years of building the last New Mooring Container Terminal in December 2007, the port authority completed construction of the PCT nearer to the Karnaphuli estuary in June last year.
The aim was to cope with increasing demand for the transport of containerised cargo.
The PCT, situated on over 32 acres of land with three jetties of a total length of 600 meters, has the capacity to handle an additional five lakh TEUs (twenty-foot equivalent units) of containers annually.
Three vessels with 11 metre draft will be able to berth at a time in the terminal, that too at the shortest possible time for its close proximity to the Karnaphuli estuary.