Lach Huyen International Gateway Port, Haiphong, Vietnam

Lach Huyen International Gateway Port

Lach Huyen International Gateway Port is under construction off the coast of Haiphong, Vietnam. It is the first public-private partnership (PPP) project between the governments of Vietnam and Japan.

Launched under the Vietnam 2020 seaport development plan, Lach Huyen port is one of several key infrastructure projects aimed at transforming Vietnam into a strong seafaring nation. It will improve the seaborne transportation between Northern Vietnam and the neighbouring countries.

The port will be developed in two phases, and will be equipped with comprehensive infrastructure and handling technology. It will be able to accommodate container ships between 4,000TEU and 6,000TEU, with the potential to accomodate 8,000TEU ships after expansion.

Upon completion, the port will enable direct exports from Northern Vietnam to the US and European markets, and eliminate transit through regional ports in Singapore or Hong Kong. This will reducing shipping costs, and increase competitiveness in the country's shipping market.

Construction of the port began in April 2013, with the first two container berths scheduled to be completed in 2016. The two berths will serve six million tonnes of cargo a year. The second phase of construction, which is scheduled for completion by 2020, will increase the port's capacity to 30 million tonnes a year.

Lach Huyen Port construction details

The port is being constructed south of Lach Huyen's river estuary on Cat Hai Island. It will have a berth of approximately 8,000m, a route length of 18km, and a bottom elevation of 14m.

The entire construction is divided into two components, A and B. Component A is being managed by the Vietnam Marine Administration, and involves the construction of port infrastructure.

The works will include construction of a one-lane access channel, anchorages, a 3,230m-long breakwater, a turning basin, a 7,600m-long sand control dyke, an internal road system, soft-soil ground improvement, temporary berths, roads in the administration area, and an administration office building.

Managed by a joint venture (JV) of Japanese and Vietnamese companies, Component B will oversee the construction of two 750m-long container berths with the capacity to handle 100,000t ships. The berths will also be equipped with technical infrastructure, and a fire-protection system.

The second component will include the development of a container depot system in 22ha, a gantry crane with a lifting capacity of 54t, a rubber-tired gantry crane (RTG), a lifting system, and tractors.

Planning and construction companies

Japan International Cooperation Agency (JICA) is involved in the planning, design, and construction of the project through technical and financial co-operation.

The construction supervision contract for the project was awarded to a JV comprising Nippon Koei, Japan Port Consultant, Portcoast Consultant and Nippon Koei Vietnam International in April 2013. Meinhardt is the sub-contractor for the JV, and provides key personnel to the project.

The financial analysis and construction planning for the project was completed by PADECO, an international development consulting company. The company was responsible for disposal of dredged material planning, demand forecasting and economic / financial analysis, road management and operations planning, and planning of HIV / AIDS prevention measures.

Financing for the project

The estimated total investment for the project is $1.2bn, which will be funded by the Japanese Official Development Assistance (ODA) loans, and a JV of Japanese and Vietnamese companies.

In November 2011, the first loan agreement for the project was signed between the Vietnam Government and JICA for a total of ¥11.92bn ($120m approximately). The second agreement, for a total of ¥37.95bn ($308m approximately), was signed in March 2014.

"The port will enable direct exports from Northern Vietnam to the US and European markets."

Approximately $900m will be invested in Component A and $321m in Component B by the Saigon Newport Corporation and Japanese investors.

Background and purpose of Haiphong Gateway port project

A number of foreign companies are located along the coastal line connecting Hai Phong and Hanoi. Hai Phong Port and Cai Lan Port are the major ports currently supporting the enterprises' commercial activities.

The two ports were recently upgraded to meet increasing transportation requirements. The total container throughput at both the ports will remain at 40 million tonnes. The estimated demand for containerised cargo in the region will be 42 million tonnes in 2015, and is expected to reach 59 million tonnes by 2020.

International sea transport markets have been experiencing an increase in orders for large-container vessels. The northern region of Vietnam, one of the key international distribution centres, requires infrastructure to accommodate large container vessels.

Since expansion of the existing ports is no longer possible, a new international deep sea port was planned to accommodate increasing traffic and large-container vessels.