By:Staff WriterColombo (LNW): China Merchant Port Holdings (CMPort) is to enter into an agreement with Sinopec to set up bunkering operations in Sri Lanka by building the largest logistics complex in S. Asia with US$ 392 mn investment.
The Company is the largest oil and petrochemical products supplier and the second-largest oil and gas producer in China.
Agreements for the construction and operation of the South Asia Commercial and Logistics Hub (SACL) as a 50-year Build Operate-Transfer (BOT) project were formally signed in Colombo by the representatives of the three investing entities.
Accordingly, China Merchants Port Holdings (CMPort) holds a 70% stake of the 50-year Build Operate-Transfer (BOT) project.while Sri Lanka Ports Authority (SLPA) and Access Engineering PLC (Access) each hold a 15% stake in the venture/
A Public Private Partnership (PPP) project, the South Asia Commercial and Logistics will be built in the centre of the Colombo Port and will have 530,000 CBM of storage capacity via an eight-floor building.
The investment in the project is expected to bring in much-needed foreign investment into Sri Lanka.
The construction of the complex is expected to begin in the second half of 2023 with a target of completion by the end of 2025.
Adjacent to Port City and the CBD, it will be directly linked with the airport via the Port Access Elevated Highway.
The five million square foot complex will offer the full gamut of logistics related facilities and services such as Less than Container Load (LCL), Multi-Country Consolidation (MCC), Container Freight Station (CFS), general warehousing and various other value-added services.
A Spokesperson for CMPort said the project will result in an infusion of US$ 126 million in addition to an upfront payment of US$ 26 million after the agreement is signed.
The project is also expected to provide direct employment to a minimum of 1,800 people and create 10,500 other indirect job opportunities.
The project aligns with Sri Lanka’s national development strategy to transform the country into a major logistics centre, identified as a key sector and a driving force for economic development in the National Policy Framework (NPF) 2019.
It will provide better logistics and warehousing facilities and services, enhancing the Port’s competitive advantage and consequently strengthening its Hub status.
The project will also improve the operational efficiency of the Port of Colombo and introduce leading-edge technology and innovation.
The Port of Colombo is currently ranked among the top 13 ports in the world in terms of shipping network connectivity.
Additionally, since the Port of Colombo was declared as a Freeport by the Government of Sri Lanka, the project will enjoy the associated Freeport advantages in its operations, such as no customs clearance for transshipment and MCC cargo, resulting in reduced paperwork and associated costs.