The Jawaharlal Nehru (JN) Port in India has terminated the Rs67bn ($1.5bn) contract awarded to the ABG-PSA consortium PSA International for the construction of a container terminal.
In addition to ending the contract, the port has also decided to encash the security bid of Rs670m ($12.34m) as the consortium, comprising India’s ABG Shipyard and Singapore’s PSA International, failed to sign the concession agreement within the extended deadline.
In August 2012, JN port set a final deadline for the consortium to sign the concession agreement for the project within ten days, ending on 10 September 2012.
PSA had a 74% stake in the consortium, while ABG Ports held the remaining share.
The project to develop a fourth container terminal at Jawaharlal Nehru Port in India was awarded to the consortium in September 2011.
Construction of the container terminal will be delayed as Jawaharlal Nehru Port will have to re-tender the project.
In January 2012, PSA backed out at short notice from signing the project’s concession agreement in Delhi.
According to reports, the consortium partners decided to part ways and PSA agreed to take up the project on its own, which was not allowed as it was against bidding rules.
The new terminal is expected to become the country’s biggest single container terminal, capable of loading 4.8 million standard containers a year.
The facility will also have a berth length of 2km to accommodate seven ships at a time, compared to other terminals in India that can handle 2-3 ships and where annual container terminal capacities range between 1 and 1.5 million standard containers.
Singapore’s PSA International currently operates port terminals in Chennai and Tuticorin and holds stakes in two other terminals in India.
