Gulftainer Company, one of the largest port operators in the United Arab Emirates (UAE), recently signed a $1bn joint venture contract with India-based LANCO Infratech Group to partner on a wide variety of port and transportation projects.
According to Peter Richards, director and general manager of Gulftainer, the company has been actively pursuing international port management opportunities throughout the Middle East and Indian subcontinent. Last week's signing of the memorandum of understanding with LANCO, was a strong signal. Richards told OBG, "They have approached us to act as consultants to plan and oversee the construction of two greenfield sites for both a bulk and container port in India."
LANCO, a Hyderabad-based infrastructure developer, has teamed up with Gulftainer to bid for a project at the government-owned Paradip Port. The project will consist of a coal and an iron ore berth, each with a capacity to handle 10m tonnes of imported coking coal and iron ore a year, costing about $227m to build. The project's bid document required that entities seeking to qualify for the project should have experienced port operators as their partners.
"The tie-up would synergise LANCO's strength in infrastructure development and Gulftainer's expertise in development and operations of ports and other transportation projects," L Madhusudhan Rao, the chairman of LANCO Infratech, told the media. LANCO, which operates in the fields of power generation, power trading, construction, infrastructure and property development, is among 17 entities that have submitted initial bids for the project.
Gulftainer began a calculated expansion campaign in 2006 to strategically raise its profile and increase its activities internationally.
"We are already assessing specific projects in the Middle East, India and the Eastern Mediterranean. [...] We've been invited to look at a $100m port management contract in Egypt and another one for $250m in the Ukraine," Richards told the press.
"Gulftainer is a private operation [...] Therefore we must choose concessions and acquisitions carefully," Richards told OBG.
"We performed a feasibility analysis on the Pakistan market and found that although a tremendous amount of investment has gone into the sea ports, very little attention was given to inland transportation and logistics. Subsequently, we invested $50m to establish a joint venture with a company named Pak Shaheen, and have since established a fleet of 33 trucks there, which will soon be increased to 50. We are now looking to establish inland container depots that will help move containers throughout Pakistan, particularly north and through to Afghanistan," he added.
Meanwhile, international port operators and transport and logistics companies have recently shown tremendous interest in Turkey due to its booming economy and strategic access to the Mediterranean.
"Due to its coastline there is a tremendous availability of small ports that can be developed into regional hubs along the Mediterranean. Gulftainer is in talks with a major Turkish transport and logistics company to become a 50-50 partner with them, we hope the partnership will be established before end of the year," said Richards.
Gulftainer had been assigned as the consultants to the Kuwait Port Authority. In the past year, Kuwait's terminals have achieved record-breaking throughputs, helping to improve performance and service standards for traders and shipping lines.
"They made a proposal for us to increase our scope of work and become the operators of Kuwait Container Terminal," Richards told OBG.
Gulftainer was established in Sharjah in 1976 to manage and operate the container terminals in Port Khalid and Khorfakkan on behalf of the Sharjah Port Authority. It expects its port traffic to increase 18% this year.
The company will develop a $24.5m inland container depot in Sharjah over the next 10 months. "We've just acquired a 500,000 sq metre plot of land where we're hoping to attract operators who require warehouse and logistical facilities," Richards told media.