VOC Port Authority Reissues Tender for ₹7,056 Crore Outer Harbour Project.

The VOC Port Authority in Thoothukudi has reissued a request for proposal (RFP) for the ambitious ₹7,056 crore outer harbour project after the initial tender failed to attract viable bidders. The previous attempt saw only two applicants, Vedanta and Premier Science and Technology, both of whom were disqualified for not meeting eligibility criteria.

To encourage greater participation, the eligibility requirements have been revised in the retendered RFP, though specific details about the changes are awaited.

Project Scope and Costs

The project involves dredging and the construction of a breakwater on a design, build, finance, operate, and transfer (DBFOT) basis. It aims to achieve a total handling capacity of 4 million TEUs (twenty-foot equivalent units) annually in two stages.

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  Stage 1: Development of Container Terminal-1 (Berths I and II), dredging, breakwater construction, and common facilities at a cost of ₹4,494 crore, with a capacity of 2 million TEUs.

  
  


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  Stage 2: Development of Container Terminal-2 (Berths III and IV) for an additional 2 million TEUs at ₹2,561 crore.

  
  

The RFP document specifies a Viability Gap Funding (VGF) cap of ₹1,950 crore or the quoted amount, whichever is lower.

Construction Timeline

The concessionaire will develop two container terminals, each with a quay length of 1,000 meters:

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  Terminal-1: To be completed within 36 months.

  
  


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  Terminal-2: To begin 24 months after Terminal-1’s completion or when 70% of Stage 1 capacity is utilized for two consecutive years, whichever is earlier. The total concession period is 45 years.

  
  

Viability Concerns

The earlier tender faced criticism after major players like the Adani Group and JSW did not participate, raising questions about the project's feasibility. Industry sources have expressed doubts about the viability of a 4-million-TEU capacity, citing limited hinterland connectivity and competition from neighboring ports like Vizhinjam and Vallarpadam.

Experts suggest scaling down the project to a capacity of 2-3 million TEUs with an investment of around ₹4,000 crore as a more feasible option.

The VOC Port Authority is aiming to address these concerns with its revised RFP and hopes to attract stronger bids in this second round.

HBL