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Thursday, 30 March 2017

Brazil’s Porto Central aims to put Presidente Kennedy on world stage

Cristoforo Amaral da Silva, PFI Brazil correspondent

The penultimate green light has been given in Brazil for a Reais$5-billion project to build Porto Central, a deepwater port and industrial complex in the south-eastern state of Espirito Santo.

In Brasilia this week, Neucimar Fraga, of the Espirito Santo logistics, transport and trade department, signed the contract with directors of Porto Central, plus top officials from the Brazilian Ministry of Transport and also Antaq (the regulatory authority for ports) for the construction to go ahead for the Mega-port.

All that is needed now is the Installation License and Fraga says that will be granted within 20 day, by Ibama, the Environmental agency, adding that once that is in place construction will start next year and the first phase of Porto Central will be completed by mid 2021.

“This port will serve to increase the competitiveness of foreign trade and bring the state of Espirito Santo back into the great wheel of cargo ship calls that the [nearby but low draft] Port of Vitoria cannot carry,” said Fraga.

Back in 2012 The port of Rotterdam and TPK Logistics – a logistics and civil construction company – teamed up to form a joint venture, called Porto Central (Central Port), and they will build and operate the multi-million dollar facility, located in an area of 23 million square yards (or 4,752 acres),  with 15 berths (phase one), a deepwater Multi-purpose port capable of handling the world’s largest vessels.

They then signed an agreement with another Dutch company Van Oord Dredging and Marine Contractors, who drew up the detailed plans for the project – which will have up to 25 metres of draft - and to build it; with construction due to start before the end of 2017.

Porto-Centralportocentral2Located in the municipality of Presidente Kennedy, some 150 km south of the Espirito Santo state capital of Vitoria, Porto Central will be a bonus especially for shipping companies operating in the offshore oil and gas sectors, and will become an Offshore Support Base for Brazil’s large oil industry: servicing rigs, Offshore Support Vessels, tankers, etc.

Porto Central says it is offering a unique solution to Brazil’s attempts to improve and increase the infrastructure of the country in that it will build the substructure and infrastructure (roads and rail links) itself, making it the landlord authority, but the superstructures for each type of terminal will be built and operated by outside partners, such as major grain or offshore terminal operators and, possibly, container operations.

Once open for business Porto Central could also pose a future threat to the only container terminal operating in the state of Espirito Santo, the Terminal Vilha Velha (TVV) facility in Vitoria, which is owned and operated by Brazil’s last surviving container carrier Log-In Logistica.

The TVV only has a draft of 10.5 metres and in recent years has lost several of its deep-sea calls, partly due to the state of Espirito Santo having its special, low import duties taken away by Brasilia. The channel to TVV can be dredged but then there are turning basin restrictions which would only allow ships of around 230 metres in length to call.

Porto Central will also pose a threat to another new port, Porto Acu, located only 44 miles away (as the crow flies) to the south in the state of Rio de Janeiro, but that threat will be more in the arenas of solid bulk and offshore port services and its status as an Offshore Support Base, as it does not have an ambition to handle containers on a grand scale, at least not one that is publicly stated.

“What we are offering here is completely different from Porto Acu or anything else on offer in Brazil today,” explained Jose Salomao Fadlalah, a director at Porto Central. “Porto Acu has been built with a huge Cap-ex, and with the intention of building a mostly iron ore port for Anglo American. We believe that with our much smaller Cap-ex we will be much more competitive.”

He added that Porto Central will also benefit, like all other Greenfield sites in Brazil, by not having to deploy casual labour from the expensive OGMOs that dominate stevedoring labour in the South American country.

Given the proximity of Porto Acu, which started operating earlier this year, and the fact that Porto Central is to be located in an area of pristine coastline, one would think the local environmental agencies might not want two huge port and industrial complexes so close to each other, but the initial environmental license (from Espirito Santo state body IEMA) was given two years ago and the Installation license, giving the project the Green light to move into the construction Phase One, was expected to be granted about a year ago. Delays occurred so that the environmental agencies could have a thorough look at the Porto Central project details.

Press release 29 March 2017


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