Pre-Feasibility Study on development of a large multi-user Non-Major Port in Tamil Nadu Madras Chamber of Commerce & Industry FINAL REPORT Pre-Feasibility Study on development of a large multi-user Non-Major Port in Tamil Nadu Madras Chamber of Commerce & Industry FINAL REPORT (Submitted to State Planning Commission in February 2015) Preliminary Feasibility Study on development of a large multi-user Non-Major Port TABLE OF CONTENTS Executive Summary ........................................................................................................... 3 Pre-Feasibility report overview .................................................................................................. 3 Report key findings .................................................................................................................... 4 Proposed site for developing Port facility .................................................................................. 5 Report conclusion ...................................................................................................................... 6 1.0 Introduction ............................................................................................................ 6 1.1 Background ......................................................................................................................... 6 1.2 Rationale for the Project .................................................................................................... 7 1.3 Feasibility Report – objectives and outline ........................................................................ 8 2.0 Tamil Nadu State Profile .......................................................................................... 9 2.1 Tamil Nadu Economy - an overview ................................................................................... 9 3.0 Indian Port Scenario: An Overview ........................................................................ 16 3.1 Traffic handled .................................................................................................................. 17 4.0 Tamil Nadu Ports Profile & Policy Framework ........................................................ 18 4.1 Tamil Nadu Minor Ports Policy ........................................................................................... 20 5.0 Tamil Nadu Industrial Regions ............................................................................... 22 5.1 Review of Govt. of India statistics & previous reports on the subject ............................. 24 6.0 Traffic Growth Potential Assessments ................................................................... 25 6.1 Traffic growth projections as per Govt. of India statistics ............................................... 25 6.2 Tamil Nadu central hinterland industries & cargo potential ............................................ 28 6.2.1 Karur ................................................................................................................................. 28 6.2.2 Namakkal .......................................................................................................................... 29 6.2.3 Tirupur............................................................................................................................... 29 6.2.4 Perambalur........................................................................................................................ 30 6.2.5 Ariyalur ............................................................................................................................. 31 6.2.6 Thiruchirapalli ................................................................................................................... 31 Page | 1 Preliminary Feasibility Study on development of a large multi-user Non-Major Port 6.2.7 Cuddalore.......................................................................................................................... 32 6.2.8 Puducherry ........................................................................................................................ 33 6.2.9 Villupuram ......................................................................................................................... 34 6.2.10 Salem ................................................................................................................................. 35 6.2.11 Erode: ................................................................................................................................ 36 7.0 Assessment of Potential Traffic .............................................................................. 37 7.1 Introduction ...................................................................................................................... 37 7.2 Cargo potential analysis ................................................................................................... 37 7.2.1 Coal ................................................................................................................................... 38 7.2.2 Cement .............................................................................................................................. 53 7.2.3 Sugar ................................................................................................................................. 57 7.2.4 Fertilizers ........................................................................................................................... 61 7.2.5 Petrochemicals .................................................................................................................. 65 7.2.6 Vegetable oils .................................................................................................................... 68 7.2.7 LNG .................................................................................................................................... 71 7.2.8 Containers ......................................................................................................................... 77 8.0 Competing Port Facility Analysis in Tamil Nadu ...................................................... 86 8.1 Other proposed captive ports .......................................................................................... 88 9.0 Key Findings & Rationale for Developing a New Greenfield Port Facility ................. 95 9.1 Summary of potential traffic at new Greenfield port ...................................................... 97 10.0 Location & Site Proposed for Development of New Greenfield Port Facility ........... 99 10.1 Status of License issued for Silambimangalam minor port .............................................. 99 10.2 Overview of Silambimangalam ship yard port ............................................................... 102 10.3 Locational advantage & conditions of the project site .................................................. 103 11.0 Preliminary Port Layout ....................................................................................... 105 12.0 Block Cost Estimates ........................................................................................... 110 Page | 2 Preliminary Feasibility Study on development of a large multi-user Non-Major Port EXECUTIVE SUMMARY The Tamil Nadu State Planning Commission (TNSPC) has taken up the task of assessing demand for developing a multi-user Greenfield port facility in Tamil Nadu and have commissioned the Madras Chamber of Commerce & Industry (MCCI) to undertake a ‘Pre-Feasibility study on Development of a Large Multi user Non Major port in Tamil Nadu’. PRE-FEASIBILITY REPORT OVERVIEW Power Generation is the primary contributor to Industrial growth of any nation. Over the last few years, Tamil Nadu has been experiencing an acute power deficit. In order to address this crucial issue, the Tamil Nadu Vision 2023 document places a very high focus on remedying this situation and fulfilling this short-fall by adding 20,000 MW of thermal power generation capacity to the State besides developing at least two LNG terminals with capacities of about 5-6 million tons per annum. As of this writing, the report has identified about 24,000 MW of planned thermal power generation proposals by private entrepreneurs in the central Tamil Nadu region. This planned capacity addition is only in the Central Tamil Nadu region and excludes any capacity additions proposed in the Northern & Southern parts of Tamil Nadu. Most of the 24,000 MW capacity addition proposed by private entrepreneurs is through development of coast based thermal power plants with a captive marine coal import facility for coal imports. Assuming that even if only 15,000 MW of the proposed 24,000 MW is added by the year 2035, the coal requirements would be about 53 Million Metric Tons Per Annum (53 MMTPA). Taking an extremely conservative view whereby even if 50% of this projected volume of 53 Million Tons required for generating 15,000 MW is to be handled, i.e. 27 Million tons per annum, there exists no suitable Port facility with adequate infrastructure in the Cuddalore – Nagapattinam belt geared to handle these projected coal volumes. Despite being a conservative estimate, the volume of coal alone required for thermal power generation has been estimated at 27 Million Tons per annum by the year 2035. In addition, coal requirements for cement & Sugar industries etc. add to this and total to an estimate of about 33 Million Tons per annum in the Cuddalore – Nagapattinam region. In its final