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 MRMRP gets Hambana Petro Chemical plant
 


 

In parallel to construction of Magam Ruhunupura Mahinda Rajapaksa Port (MRMR Port) in Hambantota, Sri Lanka Ports Authority (SLPA) received investment proposals from prospective local and foreign investors to establish industries and businesses within the port premises.

Currently, the Cabinet has approved 7 investment proposals, subsequent to the recommendations by the Cabinet Appointed Negotiating Committee with the assistance of the Technical Evaluation Committee.

Out of these 7 investors one investor has already signed the Business Venture Agreement. Another investor, Hamabana Petrochemical Limited signed the Business Venture Agreement with Sri Lanka Ports Authority on March 12, 2013 for the proposed project to set up a plant for producing Bottle Grade Polyethylene Terepthalate Packaging Resin.

Expressing views at the occasion of signing of this agreement, Minister of Port and Highways (Projects) Rohitha Abeygunawardane said this venture marks another historical juncture in the development of Magam Ruhunupura Mahinda Rajapaksa Port (MRMRP) in Hambantota in collaboration with private sector investors.

“These developments in the region, are sure signs of many direct and indirect employment opportunities for the youth in the area.

Chairman of Sri Lanka Ports Authority Dr. Priyath B.Wickrama expressing views at the occasion said that the MRMRP commissioned in 2010 is rapidly reaching its developmental goals since the past three years, whilst starting to offer due capacities to bring prosperity and strengthen socio-economic development in Sri Lanka. Abhijit Sen - Director/CEO of Hamabana Petrochemical Limited expressing pleasure to commence business with SLPA said the signing of the agreement has brought the first petrochemical downstream project in Sri Lanka, to the fast developing southern region of the country. The project will be on-stream from January 2015.

“We have found MRMRP the best facility to start this industry in Sri Lanka and this is the largest single location PET plant in the world.

It would also be integrated subsequently with a PTA plant, that would be set up in the second phase with a capital outlay of US $ 450 million.

The total tonnage for the port through this industry in phase I & II is close to 04 million tons,” he said.

The signing of the agreement for the proposed project to set up a plant for producing Bottle Grade Polyethylene Terepthalate Packaging Resin, took place between Dr. Priyath B. Wickrama - Chairman of Sri Lanka Ports Authority (SLPA) and Abhijit Sen, Director/CEO of Hamabana Petrochemical Limited and Jit Warnakulasuriya, Chairman of Hamabana Petrochemical Limited.

The investor Hambana Petrochemicals Ltd (HPL) is a company owned by Peak Energy (Pte) Ltd of Singapore. HPL is proposing to set up a state of the art Polyethylene Terepthalate (PET) Packaging Resin Plant. The proposed PET Resin Plant would have an annual PET Resin production capacity of 540,000 Mt or 1,500 Mt/ day. PET Resin is the raw material used in manufacturing PET Bottles and containers which is a popular packaging solution for carbonated soft drinks, water, liquor and various food/ non food packaging applications.

This business venture agreement is signed for an initial term of 25 years and the expected total investment of this Business Venture is US $ 137.39 million. Hambana Petrochemical Ltd would require importing raw materials of 453,000 Mt of Purified Terephthalic Acid, 183,600 Mt of Mono-Ethylene Glycol and 10,800 Mt of Purified Isophthalic Acid per annum. As the investor is willing to export the total production, hence, this will lead to increase the port activity approximately by 45,000 TEU's and 180,000 Mt liquid cargo per annum and the annual turnover from this facility will be approximately US $ 01 billion annually.

In addition to the increase of port activity, the proposed plant will generate many direct and indirect employments during 24 months of its construction period as well as during the plant operations. During the aforesaid steady state of operation, more than 200 qualified persons are expected to be employed by them in various technical and commercial levels.

However, as per the expected other benefits in this regard by SLPA, they have introduced the land lease and royalty schedule which is the main and direct revenue proposal of the SLPA.

The expected revenue from this schedule will be approximately US $ 100 million.

Greatly supporting the regional development of the southern region on one hand, the port has already secured US$700 million in investments including US$220 million from a major Indian sugar producer - Shree Renuka Sugars Ltd.

The company has already signed the Business Venture Agreement with SLPA and has formed its subsidiary local company Lanka Sugar Refinery Company (Private) Limited.

This Business venture agreement is signed for a term of 25 years. The initial capacity of this plant is 2000 Mt/ day, which will be expanded up to 3,000 Mt/ day subsequently. Raw sugar is expected to be imported by the Business Venture for refinement at this proposed plant. The company has planned utilize local human resource to the maximum level and expects to engage a 1,500 -2,000 work force during the construction period. During their steady state of operation, nearly 300 -350 are expected to be employed by them in various technical and commercial levels.

Apart from the above, nearly 1,000 persons are expected to get indirect employment opportunities through this. The construction work of this plant is expected to complete within 24 months. The expected annul land lease and royalty revenue from this investment will be US $ 63.86 million.

Meanwhile, five other investors are also willing to sign the Business Venture Agreements and commence the businesses at their earliest at the Magampura port. Accordingly, Thatta Cement (Cement Grinding Plant), Hayles Advantis Ltd (Fertilizer Bagging Plant), McLarnes Holdings Ltd (Warehousing), Agalawatta Plantation PLC (Warehousing) and ACE Distripaks (Pvt) Ltd (Warehousing) have expressed themselves to commence business at the zone.
(DN-13032013)

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