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Now a golf course at Ennore port

S Kalyana Ramanathan | February 07, 2004

Does a port for oceangoing vessels really need an 18-hole golf course on its grounds? M Raman, chairman and managing director, Ennore Port firmly believes that it does.

Says Raman: "Our customers can berth the vessel, have a good time when goods are getting loaded or unloaded and leave when the vessel is ready."

Don't dismiss Raman's ideas out of hand because he knows what he is talking about. The three-year-old port he heads is unlike any other in the country.

  • Ennore Port is likely to notch up net profits of Rs 20 crore this year, that's a 22 per cent return on its Rs 90 crore turnover. Next year, turnover is slated to touch Rs 130 crore
  • It is building facilities to handle products like liquefied natural gas and iron ore
  • The port will be handling 40 tonnes of bulk cargo by 2006-07
  • The port is planning to plant 2.5 lakh saplings in the port area, which may make it the 'greenest' port in India

For a start, it's squeaky clean even though it's a coal-handling port. Even more amazingly, it has only 20 employees. If all that isn't enough, it is likely to notch up net profits of Rs 20 crore (Rs 200 million) this year -- that's a 22 per cent return on its Rs 90 crore (Rs 900 million) turnover. Next year, turnover is slated to touch Rs 130 crore (Rs 1.3 billion).

And there are bigger plans for the future. Firstly, the port is building facilities so that it can handle products like liquefied natural gas and iron ore.

Also, it is hoping -- with the backing of the Tamil Nadu Government -- to create its own hinterland. A 3,300-acre site has been identified not far away which will be turned into a special economic zone.

Inevitably, if the SEZ is a success, it would depend heavily on the port.

It's not surprising that Ennore Port has been showered with praise by the powers that be like shipping minister Shatrughan Sinha and secretary shipping D T Joseph. Sinha, who visited Ennore recently to inaugurate a new administrative building, said that the port was an example to others in the country.

Does Ennore deserve such strong praise? The answer is almost certainly yes. The port is run on the 'landlord' concept under which the management provides only the basic infrastructure for users. The people who use the port and other service providers locate their machinery in it.

Meanwhile, the management forcuses on marketing the port and ensuring that it runs efficiently. Says Raman: "We will focus on conservancy, safety, security, connectivity and draft."

This business model gives it two distinct advantages. First, it can keep manpower to a basic minimum. Secondly, the top executives concentrate only on marketing and planning expansion.

It's also the only port in the country, which is a public limited company. Says Raman: "Ennore Port was conceptualised when the government was in the reform mode. Hence to set an example, this port was formed under the Companies Act, while other ports come under the Major Port Trust Act."

Ennore's operating statistics are certainly impressive. Ships that dock in the port aren't forced to hang around for days and weeks. In fact, the average pre-berthing detention period is 0.07 days, which is the second lowest in the country. Pre-berthing detention refers to the amount of time the vessel has to wait outside the port before it can be brought in for loading or unloading.

Mind you, Ennore isn't the only port, which now reports impressive statistics in areas like pre-berthing. Top of the charts are Visakhapatnam and Chennai ports with average pre-berthing detention period of 0.04 days. The national average is 0.25 days.

Then, there's average turnaround time (the time taken to get in and get out of the port). Here again, Ennore at 2.03 days is among the lowest in the country and well below the national average of 2.48. The average output per ship berthday, at 31,882 tonnes is the highest in the country and way ahead of national average of 8,077 tonnes.

Raman, however, says that comparisons can be misleading. Ennore is a newer port and it currently handles only coal. Its one client is the Tamil Nadu Electricity Board. "Each port has its own strengths in terms of the commodities handled. It would not be fair to compare in a very general sense, without understanding the nuances of the day to day operations of each port," he says.

Expansion plans are already well underway. Ennore Port has already drawn up a blueprint to become a multi-commodity port. It hopes to handle products like liquefied natural gas and iron ore. In the near future it will have an iron ore terminal that will be able to handle 12 to 20 tonnes.

At the same time it is planning a marine liquid terminal that will be able to handle three tonnes of POL products, LPG and chemicals. Work for building an LNG jetty to handle 2.5 tonnes of LNG has also been initiated. When all these plans fall in place, EPL will be handling 40 tonnes of bulk cargo by 2006-07.

Raman believes that ports in general have enormous opportunities if the management is pro-active and market-oriented. "Ports must not be just in the transhipment business. They should be an integral part of the value chain."

This idea, he admits, is not his. Ports in places like China and Singapore are already doing this. And the Tamil Nadu Government has identified 3,300 acres for the SEZ.

An additional 3,800 acres has been offered by the state government and the state industrial development corporation has been given the responsibility for the project. Besides that Ennore Port owns vast tracts of land so it may go ahead with the golf course. Also being planned are a restaurant and bar.

How much will all this cost? EPL reckons it will all cost around Rs 990 crore (Rs 9.9 billion). The iron ore terminal is likely to cost Rs 350 crore (Rs 3.5 billion), the new coal terminal should cost Rs 300 crore (Rs 3 billion) and the marine liquid terminal should be another Rs 200 crore (Rs 2 billion).

All three would be developed on BOT basis so that the port's capital spending is kept to a minimum. Even the Rs 140 crore (Rs 1.4 billion) dredging work would be partly funded by EPL and the rest by a contractor.

Raman proudly points at the pristine blue waters at the port and says, the depth of the port will increase to 18m from the present 15m. The clean blue sea, he says, is due to the good dredging work done at the port.

Then, there's conservation. "The coal handling business was moved from Chennai Port to EPL (which is 35 km away from the city) for environmental reasons. That does not mean that we can allow pollution in this port or the surrounding areas. This port or any port for that matter cannot exist in isolation or be insensitive to the needs of the community it belongs to," he says.

Cleanliness levels at the port are certainly quite amazing. Contract labourers are constantly cleaning the yards and it is tough to believe that the port handles 9 million tonnes of thermal coal every year.

EPL is also planning to plant 250,000 saplings in the port area, which could possibly make it the 'greenest' port in India.

What's next? The Union government has envisioned the Rs 100,000 crore (Rs 1,000 billion) Sagarmala project that would basically improve the linkage between ports using rail, road and inland waterways apart from improving the capacity and efficiency of the ports.

India needs to build huge port capacities and facilities to handle the biggest ships. And Ennore should expect to keep changing at high speed in the years to come.

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