JKH executes BOT Agreement for the development of the West Container Terminal of Colombo Port

* JKH executes BOT Agreement for the development of the West Container Terminal of Colombo Port

Thu, Sep 30, 2021, 07:56 pm SL Time, ColomboPage News Desk, Sri Lanka.

Sept 30, Colombo: John Keells Holdings says that the agreement regarding the Colombo Port West Container Terminal (WCT) was signed today (30), the company said in a disclosure to the Colombo Stock Exchange.

The Build, Own and Transfer (BOT) Agreement between the Sri Lanka Ports Authority (SLPA) and the Colombo
West International Container Terminal (Private) Limited (CWIT), the local partner of Adani Ports and Special Economic Zone Limited (APSEZ) was executed today.

“We wish to inform you that the BOT Agreement between the Sri Lanka Ports Authority (SLPA) and the Colombo
West International Container Terminal (Private) Limited was executed today. The BOT Agreement between the
SLPA and CWIT is for a lease period of 35 years,” JKH said in the disclosure.

Pursuant to the receipt of the Letter of Intent on 15 March 2021 from the Ministry of Ports and Shipping and the Sri Lanka Ports Authority (SLPA), Colombo West International Terminal (Private) Limited (CWIT), the Project Company, which has been incorporated to undertake this investment has worked towards the criteria to enable the entering into of a Build, Own and Transfer (BOT) Agreement.

The West Container Terminal-1 (WCT-1) in the Port of Colombo is a deep-water terminal with a quay length of 1,400 meters and an alongside depth of 20 meters and has an annual handling capacity of approximately 3.2 million TEUs.

CWIT expects to commence construction of the terminal in early 2022 with phase 1 of the terminal, comprising of a quay length of 600 meters, slated to be operational within a period of approximately 24 months, the disclosure said. The remainder of the terminal is expected to be completed within a further period of approximately 24 months.

The total project cost is envisaged to be approximately USD 650 million with a debt to equity mix of approximately 70:30.

The JKH equity commitment is estimated to be USD 70 million, which will be infused into CWIT on a staggered basis over the project construction period. JKH will have an equity stake of 34 percent in CWIT, while APSEZ and the SLPA will hold 51 percent and 15 percent, respectively.

The debt funding for the project has been secured, subject to the closure of the related financing documents which will be completed prior to project commencement, the JKH said.

The development and operation of the WCT-1 has been identified as a Strategic Development Project with the requisite Gazette being issued on 30 July 2021.

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