The Business Times
by George Joseph
PRIVATELY held Overseas Port Management (OPM), led and managed by several former PSA executives, has proposed to the Yemeni government to turn the country’s port into a container transhipment hub for the Red Sea-Mediterranean region, and boost its economy in the process.
The Singapore port management company is making an ambitious bid to invest in the development and extension of Aden’s container terminal port, its confidence stemming from its success in managing the terminal for the past three years.
Other benefits for the country, if OPM’s plans materialise, include more employment, strong feeder networks and more confidence from foreign investors in Yemen, a nation previously torn by civil strife and hit by major security threats.
OPM’s proposals come just as it received word yesterday of a one-year extension to its current three-year management contract to operate the Aden Container Terminal (ACT), which Singapore’s PSA Corporation withdrew from in 2003 following security threats in the region resulting in insurance underwriters charging shipping lines hefty war risk premiums.
OPM boosted last year’s cargo handling at the Aden terminal by 26 per cent to 350,000 TEUs. It started off in 2003 with 117,488 TEUs. Now, it has ambitions to develop the terminal in phases to reach a handling capacity of 1.5 million TEUs.
On the back of such increases, OPM says it is now preparing for a significant round of fresh investment in the expanding container terminal. It has indicated to to the Yemeni government its strong interest in investing in the port’s future development, OPM chief executive officer MMJ Subramaniam told BT yesterday.
‘OPM, with its strategic partners and investors, is prepared to develop and construct a new berth of 350 metres, in addition to the existing 700 metre berth, to increase ACT’s terminal handling capacity to 1.5 million TEUs and more,’ he said.
He disclosed that OPM has now accumulated sufficient retained revenues for ACT to extend yard space, buy new cranes and equipment and an IT terminal operating system to expand the business.
‘As demand for more berths arises, OPM group is prepared to develop the second 1,000 metres of wharf in ACT so the terminal can have a total of 2,000 metres of wharf/berths in phases. This will of course depend on the success of the Free Zone Public Authority’s ability in successfully implementing an industrialisation programme,’ he added.
With three years of operating experience and achievements under its belt at ACT, OPM is prepared to go from a relationship of management to investment in the terminal, said Mr Subramaniam, a former PSA senior vice president for international business.
He said the renewal negotiations with the government had proved amicable and straightforward. ‘We have an excellent relationship with Yemen, and there is no doubt they see the value OPM brings to ACT.’
‘We believe the international shipping community’s confidence in ACT and Yemen has been restored. ACT is being recognised as growing hub, and is also designated by customer-lines as a ‘catch-up’ port when ships are on tight schedule,’ he said. He said OPM has trained 70 per cent of the operational staff at the terminal, mostly Yemenis.
‘OPM has earned and accumulated for ACT US$17.5 million in retained earning (Ebitda) over the last three years. This is a very creditable number, and we hope we can improve on this even further given time,’ he said.
The Singapore management helped boost services to Aden and brought in five leading shipping lines, Hapag Lloyd, Evergreen, Cosco, Wan Hai and K Line, in addition to retaining big customers such as Singapore’s PIL and APL.
Recently, the group brought in a new Far East-Europe service to call at Aden as the intermediate transhipment hub for the Red Sea, East Africa and the Middle East region.
Mr Subramaniam said if OPM succeeds in being a long-term concession operator and investor in Aden, it will attract more shipping lines to the terminal.
The Singapore company has been growing and gradually transforming itself into a leading private port management and consultancy company. Besides the Aden terminal, OPM is also the project manager of the Shahid Rajee Container Terminal in Bandar Abbas, Iran, with a current annual throughput of 1.3 million TEUs.
OPM has also undertaken port, terminal and logistics consultancy work in many parts of the world, including Saudi Arabia, Egypt, China, Indonesia and Australia.