Sri Lanka John Keells mulls more port investments
ECONOMYNEXT – Sri Lanka’s John Keells Group has said it’s considering more investments in the ports business given government plans to build more cargo handling infrastructure.
The conglomerate has particularly indicated interest in the East Container Terminal (ECT) of Port of Colombo’s new South Harbour, for which the government has called for expressions of interest.
The ECT could complement operations of South Asia Gateway Terminals (SAGT), Colombo’s first privately operated container facility in which JKH has a big stake, the company told shareholders.
The new ECT is being built next to SAGT on its western side in the new harbour.
“The group will continue to evaluate opportunities in the transportation industry, particularly considering the government’s intent to promote private-public partnerships such as with the East Container Terminal (ECT) of the Port of Colombo,” JKH said in its annual report.
“The Group will look to leverage on this investment opportunity considering the overall prospects for the Port of Colombo and the ability for the ECT to cater to larger vessels, which will complement the operations of SAGT considering its back-to-back location that will facilitate operational efficiencies.”
JKH Chairman Susantha Ratnayake said that, although South Asia Gateway Terminals recorded a decline in volumes, as expected, due to continuous deployment of larger, more cost-effective vessels requiring a deep draft, overall volumes in the Port of Colombo continued to grow.
The new capacity was being absorbed rapidly with a total capacity utilisation close to 70 percent, he told shareholders.
“While this will result in future growth for SAGT, it also necessitates early development of the East Container Terminal, which is potentially a growth opportunity for our ports business,” Ratnayake said.
He noted that SAGT was ranked number one in South Asia and number four in the world for terminal productivity by the Journal of Commerce, USA, in September 2015.
(Colombo/June 13 2016)