Technical Assistance Consultant s Report

Transcription

1 Technical Assistance Consultant s Report Project Number: September 2015 People s Republic of Bangladesh: Strategic Master Plan for Chittagong Port (Financed by the Japan Fund for Poverty Reduction) Prepared by: HPC Hamburg Port Consulting GmbH KS Consultants Limited, Dhaka, Bangladesh Sellhorn Ingenieurgesellschaft mbh, Hamburg, Germany For: Ministry of Shipping Chittagong Port Authority This consultant s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project s design.

2 Asian Development Bank Chittagong Port Authority STRATEGIC MASTER PLAN FOR CHITTAGONG PORT Final Report, Part 2 HPC Hamburg Port Consulting GmbH Container Terminal Altenwerder Am Ballinkai Hamburg Germany Phone: Fax: p.cardebring@hpc-hamburg.de Internet: In Technical Cooperation with KS Consultants Limited House # B/173 (2nd Floor) Road # 23, DOHS Mohakhali Dhaka Bangladesh Phone: Fax: ksconsultant@yahoo.com Sellhorn Ingenieurgesellschaft mbh Teilfeld Hamburg Germany Phone: Fax: info@sellhorn-hamburg.de Internet: Copyright by HPC September /09/ :38 F:\PROJ\PPOS\26321_Bangladesh_Chittagong Masterplan\Reports\Final Report\Part 2\Final Report_Part 2.docx

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4 Strategic Master Plan for Chittagong Port Final Report, Part 2 iii TABLE OF CONTENTS Page EXECUTIVE SUMMARY 1 1. INTRODUCTION Background Project Objective and Scope The Role of This Report CHITTAGONG TRAFFIC INTEGRATION Major Cargo Flows at the Public Port Vessel Traffic Land Side Traffic Rail Transport Inland Waterway Transport Road Transport Customs Procedures Introduction Trade Classification Processes Chittagong City Development Plans Introduction Regulatory and Institutional Framework General Zoning and Land Use Development Plans ANALYSIS OF CURRENT PORT OPERATIONS Overview Port Operations Marine Department Berths Road Rail Applied Tariff Chittagong Container Terminal (CCT) Facility Overview Operations Spatial Alignment Capacity Enhancement CCT 95

5 iv Strategic Master Plan for Chittagong Port Final Report, Part General Cargo Berths GCB Facility Overview Container Operations General Cargo at GCB Operations New Mooring Container Terminal (NCT) STATUS OF THE PORT EQUIPMENT AND MAINTENANCE FACILITIES Container Handling Equipment Overview CCT and NCT General Cargo Berths (GCB) Additional Container Handling Equipment on Order General Cargo Handling Equipment Workshop Facilities for Cargo Handling Equipment Private Operator Saif Powertec Ltd Workshop D Workshop C Workshop AB NCT Workshop Central Workshop Marine Equipment Other Handling Facilities Fertilizers Grain Cement Clinker Crude Oil and Finished Products Other IT SYSTEMS AND ORGANISATION Summary of Findings and Recommendations IT Infrastructure CPA Data Center Data Centres in other Locations Network Infrastructure Recommendations for IT Infrastructure IT Organisation Recommended Improvements for IT Organisation Systems used in Terminal Operation 160

6 Strategic Master Plan for Chittagong Port Final Report, Part 2 v Terminal Operation System (TOS) Electronic Data Interchange (EDI) Possible operational Improvements by IT Systems in Maritime Operation Systems for Safety and Security Organisation and Security Processes CCTV Incident and Event Management Access through Gate and to Terminal Areas Recommendations for Improvement Systems in Finance and Administration Billing Recommendations for IT in Finance and Administration IT Systems in the Port Hospital Recommendations and Requirements Technical Recommendations PROGRAMME OF RECOMMENDED ACTIONS FOR PERFORMANCE IMPROVEMENT Principle Consideration Introduction Concessions Benefits Operating Licenses Measures for NCT Improvement Measures Technical Feasibility Cost Estimate Measures for CCT Technical Feasibility Cost Estimate Tentative Schedule Procurement Maintenance and Repair Engineering, Organisational Matters PORT DEVELOPMENT ALTERNATIVES Introduction Capacity and Demand Development New Mooring Container Terminal, NCT 218

7 vi Strategic Master Plan for Chittagong Port Final Report, Part Karnaphuli Container Terminal, KCT Development Concept Handling Volumes KCT Terminal Development Financial Analysis New Multi-Purpose Terminal MPT Background and Present Situation Traffic Projection Terminal Layout Equipment Requirements and Capacities Manpower Other Facilities Required Infrastructure Rehabilitation Financial Analysis Other Alternatives Introduction of Further Options Land Use Selection of Most Preferred Alternative Development Plan Bay Container Terminal Infrastructure Investment Requirements and Costs Financial Analysis Measures to Overcome Lacks of Capacity Evaluation of Development Options Improvement of the Navigability of the Karnaphuli River Karnaphuli River Mouth Gupta Bend Navy Area ENVIRONMENTAL ASSESSMENT OF DEVELOPMENT ALTERNATIVES Introduction Assessment of Environmental Impact Policy and Legal Framework Procedures for Assessment of Environmental Impact Assessment of Social Impacts Assessment of Eventual Land Acquisition and Resettlement Legal Framework for Land Acquisition Framework on Resettlement DOCUMENT REGISTER 349

8 Strategic Master Plan for Chittagong Port Final Report, Part 2 vii ANNEX Annex 1: Annex 2: Annex 3: Annex 4: Annex 5: Annex 6: Annex 7: CPA Equipment List Karnaphuli Container Terminal Bay Container Terminal Multi-Purpose Terminal Enhanced CCT Container Terminal Land Use List of Abbreviations

9 viii Strategic Master Plan for Chittagong Port Final Report, Part 2 TABLE OF FIGURES Page Figure 1: Container Flows at CGP, 2012 Based Estimations 15 Figure 2: Bangladesh Railways Map 24 Figure 3: Chittagong Marshalling Yard 25 Figure 4: Navigational Rivers Bangladesh 26 Figure 5: Bangladesh Customs Houses and Stations 28 Figure 6: Suggested BCIM Economic Corridor Routing 30 Figure 7: Import Process, Declaration and Handling 36 Figure 8: FCL Import Container Flows 37 Figure 9: General Zoning of 12 Detailed Planning Zone (DPZ) 45 Figure 10: Land Use Plan of Detailed Area Plan 46 Figure 11: Karnaphuli Tunnel 52 Figure 12: Gates at In Gate Plaza 63 Figure 13: CCT Railhead 64 Figure 14: SC Rail Operations 65 Figure 15: NCT Railhead 66 Figure 16: CCT Terminal Area 72 Figure 17: CCT, Daily Berth Performance in Figure 18: Full Set of Hatch Covers on Apron 80 Figure 19: Navis N4, Yard Map Filtered For Exports 82 Figure 20: Dwell Times of Containers with Slot Position 90 Figure 21: Misused Operational Area 91 Figure 22: Inspection in Stacks 92 Figure 23: Pallet Storage in Container Yard 92 Figure 24: Equipment and Scrap Close to Quay 93 Figure 25: Long Standing Boxes 94 Figure 26: CCT Spatial Alignment, Stacking Areas 96 Figure 27: Overview Aligned CCT 97 Figure 28: Ship' Gear Spreader Positioning 103

10 Strategic Master Plan for Chittagong Port Final Report, Part 2 ix Figure 29: Unorganised Truck Traffic 103 Figure 30: Trucks Queuing for Idle Ship's Gear 104 Figure 31: Apron Blocked Due to Container Operations 104 Figure 32: Trucks Waiting for Container Handling Equipment 105 Figure 33: Operational Decision Processes 106 Figure 34: Ship-to-Shore Container Gantry Cranes 114 Figure 35: Rubber-Tyred Container Gantry Cranes 115 Figure 36: Mobile Harbour Crane 119 Figure 37: Straddle Carriers 120 Figure 38: Reachstackers, Empty Handlers, Container Movers 122 Figure 39: Mobile Cranes and Forklift Trucks 126 Figure 40: Kranbau Eberswalde and Kampnagel Jib Cranes 128 Figure 41: Saif Workshop 129 Figure 42: Workshop D 131 Figure 43: Workshop C 133 Figure 44: Workshop AB 134 Figure 45: NCT Workshop 134 Figure 46: Central Workshop, General Cargo Handling Equipment 135 Figure 47: Overview of Marine Workshop Area 137 Figure 48: Pictures from Marine Workshop and Slipway 138 Figure 49: Tug Boats and other Crafts 140 Figure 50: Kafko and CUFL Jetty Facilities 142 Figure 51: Chittagong Silo Facilities 144 Figure 52: Jetty Facilities of Ruby Heidelberg Cement 147 Figure 53: Oil Dolphins Figure 54: Fiber Optic Cable Switchboard in CCTV Control Center 154 Figure 55: Data Center in CPA Headquarter 155 Figure 56: Other Data Centres and Server Locations 156 Figure 57: Gate Control to the Port Area 161 Figure 58: Truck Congestion at the Gates 162 Figure 59: New Gates under Construction 163 Figure 60: Discharge Operation 164

11 x Strategic Master Plan for Chittagong Port Final Report, Part 2 Figure 61: One Stop Service Center (Entrance Hall) 165 Figure 62: Service Center Desks 166 Figure 63: Process of Export Loading 167 Figure 64: VTMS Vessel Traffic Management System 173 Figure 65: CCTV Security Surveillance 175 Figure 66: Gate and Warehouse Surveillance 176 Figure 67: Gate Pass Documents 178 Figure 68: CPA Security Data Center 179 Figure 69: CPA Hospital Entrance Area 182 Figure 70: Central Server for the Hospital Management System 183 Figure 71: Use of Computer in Indoor Division 184 Figure 72: Medical Laboratory with Computerized Blood Analyser 184 Figure 73: Personal Medical Healthcare Book 185 Figure 74: Central Medical Store 185 Figure 75: Aerial View NCT Terminal 194 Figure 76: Furniture NCT Quay Wall 194 Figure 77: Reinforced Concrete RTG Beam on NCT Yard 195 Figure 78: Section Concrete Block Pavement NCT Yard (as-built) 196 Figure 79: NCT Gate Plaza 197 Figure 80: Proposed New Arrangement of RTG Blocks on the Existing CCT Yard 200 Figure 81: Area to Be Transferred from GCB to CCT 201 Figure 82: Existing Pavement at Yard Figure 83: Bridges over Mohesh Khal 202 Figure 84: Condition of Yards at New Stripping Area 202 Figure 85: Utilities Interrupted by Construction of CFS (Example) 203 Figure 86: Location of CFS at CCT Terminal 204 Figure 87: Container Freight Station CCT 204 Figure 88: Existing Out and In-Gates at CCT to be Redesigned 205 Figure 89: Status of Future In-Gate CCT 206 Figure 90: Status of CCT Yard Pavement 207 Figure 91: Schedule of Main Measures and Projects 210

12 Strategic Master Plan for Chittagong Port Final Report, Part 2 xi Figure 92: Project Schedule 218 Figure 93: Different NCT Development Options 219 Figure 94: KCT 1, Map 221 Figure 95: KCT 1, Main Yard 222 Figure 96: Condition of GCB 7 to Figure 97: KCT 1, Quay Wall Alignment 225 Figure 98: F-Shed to be Rearranged 226 Figure 99: KCT 1, Railhead 229 Figure 100: KCT 1, Summary Capital Expenditure, without Dredging 232 Figure 101: KCT 1, Development of Opex 239 Figure 102: GCB- Envisaged MPT-Terminal 245 Figure 103: Multi-Purpose Terminal Layout 248 Figure 104: MPT Quay Length 248 Figure 105: MPT Possible Footprint 252 Figure 106: Condition of GCB berths 4 to Figure 107: MPT, Summary Capital Expenditure 267 Figure 108: Development of Opex 273 Figure 109: Focus areas for future development 279 Figure 110: Laldia area location 280 Figure 111: Potential Location at Karnaphuli River Left Bank 281 Figure 112: Possible Location of Bay Container Terminal 282 Figure 113: Areas of Possible Bay Container Terminal 283 Figure 114: Natural Sand Banks at Bay Terminal 284 Figure 115: Installed Capacity vs. Future Demand Figure 116: Expected Handling Shares BCT Figure 117: Expected Handling Volumes BCT Figure 118: Sample Design Vessel 291 Figure 119: Berth Requirements BCT Table 117: Yard Configuration RTG Area Selected Years 294 Figure 121: Quay Crane Requirements BCT Figure 122: Mobile Harbour Crane Requirements Figure 123: RTG Requirements BCT

13 xii Strategic Master Plan for Chittagong Port Final Report, Part 2 Figure 124: Number of RTG Blocks BCT Figure 125: Tractor and Trailer Requirements BCT Figure 126: Layout Proposal BCT Phase I 302 Figure 127: Layout Proposal BCT Final Stage Phase II 303 Figure 128: BCT, Summary Capital Expenditure, Without Dredging 311 Figure 129: BCT, Development of Opex 316 Figure 130: Port Feeder Barge System 321 Figure 131: Derrick Barges 321 Figure 132: Critical Areas - Karnaphuli River Mouth 324 Figure 133: Critical Areas Anchored Vessels 325 Figure 134: Critical Areas Gupta Bend 326 Figure 135: Critical Areas Navy Area 327 Figure 136: Steps to be followed for Environmental Clearance Certificate for Red Category Project 342 LIST OF TABLES Page Table 1: Reporting 13 Table 2: Container Flows, Table 3: Selected Import Commodities Containerised 17 Table 4: Bulk and General Cargo Handled, Table 5: Container Vessels 19 Table 6: Container Vessels 3/2012-2/ Table 7: General Cargo and Bulk Vessels Table 8: Aggregated Berth Occupancy, 2012/13 21 Table 9: Draft at Berth 22 Table 10: Customs Dues Exemptions 31 Table 11: Terminal Throughput and Berth Occupancy 57 Table 12: Container Handling Productivity,

14 Strategic Master Plan for Chittagong Port Final Report, Part 2 xiii Table 13: Chittagong Port Gates 60 Table 14: Tariff Structure Containers 67 Table 15: Container Storage Tariff 69 Table 16: Fact Sheet CCT 70 Table 17: Container Type Quantification (2012/13) 74 Table 18: Container Dwell Times 75 Table 19: CCT Nominal Capacity Estimation 75 Table 20: CCT Quay Performance 78 Table 21: Correlation of Performance with Potential Factors 78 Table 22: Vessel Handling Report Summaries 81 Table 23: Cost Effect of Delayed Vessels 84 Table 24: Yard Blocks CCT 85 Table 25: Import Boxes, Type Clusters, Q Table 26: Yard Equipment and Yard Moves, CCT (2012) 86 Table 27: Truck Turnaround Times 87 Table 28: Trucks Waiting for Gate-Out 88 Table 29: Capacity Enhancement CCT 97 Table 30: Fact Sheet GCB 98 Table 31: GCB Stevedoring Contractors/Agents 99 Table 32: GCB Container Throughput Table 33: Container Type Quantification (2012/13) 101 Table 34: GCB Nominal Container Capacity Estimation 101 Table 35: GCB Quay Performance, Containers 102 Table 36: Berth Operators 107 Table 37: General Cargo Throughput GCB (2013) 108 Table 38: Container Handling Equipment belonging to CPA 111 Table 39: Additional Container Handling Equipment on Order 124 Table 40: General Cargo Handling Equipment at Chittagong Port 125 Table 41: Tug Boats in Operation 140 Table 42: Annual Budget for Maintenance Costs ('000 USD) 198 Table 43: Cost Estimate Civil Works for CCT Improvement ( 000 USD) 208 Table 44: Annual Budget for Maintenance Costs ('000 USD) 210

15 xiv Strategic Master Plan for Chittagong Port Final Report, Part 2 Table 45: Container Handling Capacities and Demand (000 TEU) 216 Table 46: KCT 1, Quay Capacity 221 Table 47: KCT 1, Yard Capacity 223 Table 48: KCT 1, Capacity Development 223 Table 49: KCT 1, Handling Volumes 227 Table 50: KCT 1, Quay Capacity and Demand Development 227 Table 51: KCT 1, Yard Capacity and Demand Development 228 Table 52: KCT 1, Initial Equipment Investments ( 000 USD) 230 Table 53: KCT 1, Civil Engineering Costs ('000 USD) 231 Table 54: KCT 1, Total Investment 232 Table 55: KCT 1, Wages and Salaries 233 Table 56: KCT 1, Development of Payroll Expenses 235 Table 57: KCT 1, Energy Consumption 236 Table 58: KCT 1, Development Energy Cost, 000 USD 236 Table 59: KCT 1, Annual M & R Costs of Major Equipment 236 Table 60: KCT 1, Development M&R Costs, 000 USD 237 Table 61: KCT 1, Development Other Expenses, '000 USD 238 Table 62: KCT 1, Development of Costs per TEU 239 Table 63: KCT 1, Applied Tariff 240 Table 64: KCT 1, Development of Revenues, 000 USD 241 Table 65: KCT 1, Revenues and Costs Projection 242 Table 66: KCT 1, Summary of Cash Flows 242 Table 67: KCT 1, Summary of Financial Evaluation 243 Table 68: Commodity Forecast 246 Table 69: Estimated Lot Sizes' Development 247 Table 70: Estimated Annual Ship Arrivals 247 Table 71: Quay Wall 249 Table 72: MPT: Current Berth Productivity (tons/berth-hr) 250 Table 73: MPT: Berth Productivity Development (tons/berth-hr) 251 Table 74: MPT: Annual Vessel Working and Berthing Hours 251 Table 75: MPT: Land Utilisation Factors 253 Table 76: MPT: Storage (tonnes) 253

16 Strategic Master Plan for Chittagong Port Final Report, Part 2 xv Table 77: Storage Space Development 254 Table 78: Total Area Utilisation 255 Table 79: MPT Equipment Requirements 256 Table 80: Recommended Manpower Requirements 258 Table 81: MPT, Initial Equipment Investments ( 000 USD) 265 Table 82: MPT, Civil Engineering Costs ('000 USD) 265 Table 83: MPT, Total Investment 266 Table 84: MPT, Wages and Salaries 268 Table 85: MPT, Development of Payroll Expenses 269 Table 86: MPT, Energy Consumption 270 Table 87: MPT, Development Energy Cost, 000 USD 270 Table 88: MPT, Annual M & R Costs of Major Equipment 271 Table 89: MPT, Development M&R Costs, 000 USD 271 Table 90: MPT, Development Other Expenses, '000 USD 272 Table 91: MPT, Development of Costs per Tonne 273 Table 92: MPT, Applied Tariff 274 Table 93: MPT, Development of Revenues, 000 USD 275 Table 94: MPT, Revenues and Costs Projection 275 Table 95: MPT, Summary of Cash Flows 276 Table 96: MPT, Summary of Financial Evaluation 277 Table 97: Areas for Future Development related to Land Use Map 278 Table 98: Gap Analysis Container Handling Capacities Selected Years 287 Table 99: Expected Handling Volumes BCT 289 Table 100: Vessel Call Pattern BCT 291 Table 101: Main Berth Requirements Selected Years 292 Table 102: River Vessel Berths Selected Years 293 Table 103: Slot Requirements Container Yard BCT Selected Years 294 Table 104: Quay Crane Requirements BCT Selected Years 296 Table 105: Required RTGs, Tractors and Trailers for BCT Selected Years 299 Table 106: Further Equipment Requirements BCT Selected Years 300 Table 107: Nominal and Planned Water Depths at Quay Walls for Container Vessels 305

17 xvi Strategic Master Plan for Chittagong Port Final Report, Part 2 Table 108: BCT, Initial Equipment Investments ( 000 USD) 308 Table 109: BCT, Civil Engineering Costs ('000 USD) 309 Table 110: BCT, Total Investment 310 Table 111: BCT, Development of Payroll Expenses 312 Table 112: BCT, Energy Consumption 313 Table 113: BCT, Development Energy Cost, 000 USD 313 Table 114: BCT, Annual M & R Costs of Major Equipment 314 Table 115: BCT, Development M&R Costs, 000 USD 314 Table 116: BCT, Development Other Expenses, '000 USD 316 Table 117: BCT, Development of Costs per TEU 317 Table 118: BCT, Development of Revenues, 000 USD 317 Table 119: BCT, Revenues and Costs Projection 318 Table 120: BCT, Summary of Cash Flows 318 Table 121: BCT, Summary of Financial Evaluation 320 Table 122: Environmental Policy, Acts and Rules and their Relevancy with the Project 330 Table 123: Other Relevant Legislations Applicable 334 Table 124: Other Relevant Legislations Applicable 337 Table 125: Relevant Occupational Health and safety Laws and Rules 339 Table 126: Relevant International Treaties, Conventions and Protocols signed by Bangladesh 340 Table 127: List of Documents Provided to the Consultant 349

18 Strategic Master Plan for Chittagong Port Final Report, Part 2 1 EXECUTIVE SUMMARY Bangladesh is one of the most densely populated countries in the world with a density of 1,049 persons per km² In 2013 Bangladesh had a population of million people and the latest population forecasts indicate that the yearly growth rate will diminish from 1.2% to 0.37%, leading to a population of 200 million people in 30 years. At the same time the rural-urban migration rate is increasing, leading to challenges for the urban planning. The capacity and efficiency of Chittagong Port contributes significantly to the efficiency and competitiveness of the country s economy as a whole. Therefore it is of utmost importance to upgrade the efficiency of the Chittagong Port including its important road-, rail and inland waterway links to become a more competitive transport hub with efficient links. There are currently three main alternatives for freight transport between Chittagong and Dhaka which are road, rail and waterways. It is found that most of the National and Regional Highways are connected to the Chittagong Port but the main problem encountered therein is from the entry/exit of port access roads which need to substantially enhance the capacity. In addition, lack of parking and waiting facilities which lead to that trucks park at roadside in and around of the port giving rise to congestions. Therefore, it is imperative to take measures to overcome traffic congestion at the port areas. Traffic management is one of the options to reduce traffic congestion and increase the port access road capacity. Vessel traffic at Karnaphuli River is subject to considerable restrictions. In essence, vessels maximum LOA is 190m; maximum draft must not exceed 9.5m. Presently, (2014), some 15 regularly scheduled container services are calling Chittagong, not including any slot charter service. These services represent sufficient weighted carrying capacity to cater for the present throughput at Chittagong Port. Vessels are not only limited in terms of their TEU intake. Some services also operate vessels that are significantly smaller than the permitted maximum vessel dimensions. Pilotage and tugboat assistance are compulsory at Chittagong Port and due to the heavy traffic on Karnaphuli River with up to 3,000 movements within 24 hours, vessels above 165m have daylight restrictions for navigation. In practise, there is no navigation after 10 pm, due to sight limitations.

19 2 Strategic Master Plan for Chittagong Port Final Report, Part 2 Land side traffic to and from Chittagong Port is mainly facilitated by road transport for containerised, project and general cargo. Only with bulk cargos, lightered at outer anchorage or at the dedicated jetties in the port, there are significant inland waterways transport volumes. From the dedicated jetties and the adjacent dedicated terminals, some cargo volumes are also transported by rail. A fraction of containers are also transported by rail. Customs in Bangladesh is a division of the Bangladesh National Revenue Board (NBR). Different from most countries, customs contributed 35% of NBR s total revenue in The customs traffic control and tariffing of border crossing trades are a main source of NBR revenues. The target for the half year July 13 to December 14: was announced as to Tk16,962; the underlying annual growth rate was around 15%. This is much higher than the expected BIP growth for these years, and illustrates that customs is in first instance considered as a revenue generator and not considered in term of trade facilitation. This explains why customs regulations are comparably tight, imposing considerable constraints on trade, especially on imports. The Chittagong Customs House handles around 50% of the total volume of the import to Bangladesh and 80% of the total volumes of export, and is thus the most important customs station in Bangladesh. The analysis of the customs regulations and practices at Chittagong Port shows that for the facilitation of trade development through Chittagong Port, Customs authorities in Chittagong can contribute by measures that address the following areas: Import: Increase the number of commodities released for devanning outside the port. This measure is already practiced by Customs authorities but might be accelerated. More containers stripped outside the port would reduce costs, speed up the lead time of imports through the port and would reduce the road traffic inside the port. Import: Customs should acknowledge more depots in the Chittagong area. If this would require more customs officers at the depots, Customs should address this internal HR issue by training and/or recruitment. Operations: Customs should be prepared to define jointly with Port of Chittagong authorities procedures for the removal of long standing containers and cargo. Cargo for auctioning blocks operational/storage areas for too long. Operations: Customs should jointly with the port and terminal operators define the responsibilities for a single gate-out stop. 1 42% in , Cf.

20 Strategic Master Plan for Chittagong Port Final Report, Part 2 3 Asycudas: Although the Asycudas 2 system has been implemented, a lot of paper documents are processed at Customs, as well as in the port The Consultants recommend to fully use the Asycudas system in order to increase the reliability and the process time of notification and clarifications. The analyses of the current port operations at the CCT container terminal have identified a number of problems hindering the loading and discharging of containers. Two major problems identified are the direct deliveries of export containers and the availability at the quay and, the lack of export stow planning. These effects in turn leads to too long idle and waiting times for the vessels at the quay, since there are insufficient numbers of export containers available at the start of the loading process, and the loading of export containers is postponed to a later point of time. This is caused by the fact that most operators allow huge proportions of direct deliveries of containers to the quay. For the handling productivity this has a strong negative effect and leads to that on average each container vessel is delayed by around 30 hours per call, which causes additional operational and charter costs of approximately 15,000 USD per call. The following short term operational remedies for the CCT container terminal are proposed: Chittagong Port container handling urgently requires a 100% through the yard policy for all export containers. This would be a prerequisite to raise the terminal performance to an internally acceptable level. This measure requires additional storage areas. The terminal capacity is evidently limited due to dwell times that are far extended beyond the industrial average. Were these adjusted, capacities would suffice to allow all export containers through the stacks, which would in turn increase the quay side performance. Remove long standing containers to a remote yard. Alter tariff and introduce an extra charge for this move. This would be an incentive for faster actions for those clients who still intend to clear the container. All others have at that time already abandoned the container and will leave it to CPA. Straddle carriers (SC) are used for horizontal transfer of import containers from the RTG blocks. This could in principle be done by internal trucks, yet containers at the CFS are grounded and in the stripping areas, containers are grounded or put in second tier. In the long run, the expensive SCs should be replaced by a combination of trucks and reach stackers.

21 4 Strategic Master Plan for Chittagong Port Final Report, Part 2 For the GCB terminal, it is not recommended to invest in effective upgrading measures. Instead a partial transfer to modern container terminal structures in the form of the new Karnaphuli Container Terminal (KCT) and a Multi-Purpose Terminal (MPT) is recommended. With regard to the used IT systems at Chittagong Port, the organisation and responsibilities within the port area is split between the different areas of CPA. Some areas are operating their own systems, servers and databases independently in remote network environment. The following improvement recommendations are made: In order to achieve the best benefit of the entire IT infrastructure in the port for every user, all IT activities including IT support should be coordinated by a central department within CPA, headed by a CIO (Chief Information Officer). The outcome of the Container Traffic Management System (CTMS) in operations is partly inefficient due to lack of information about container bookings in the export process. Whereas the container terminal is using the CTMS and mobile data terminals to organise efficient operation during discharging of containers, the loading process is completely under manual coordination which leads into the fact that the port is not even able to provide an electronic departure bay plan for the vessel to sail. This export procedure, caused by missing container booking information from the shippers side and extremely late arrival of export containers, is not according to modern international standards and should be improved. The exporting companies and their shipping agents should improve their booking forecast processes as they should also be interested in efficient procedures in the port. In state-of-the-art container terminal organisations, the CTMS will always be used in real-time mode in order to allow efficient operation of the terminal. From the technical side, the server hardware of the CTMS is not powerful enough, the SQL database should be changed to ORACLE and the software version of the CTMS is very old and should be updated. Regarding gate operation for all kinds of vehicles, an overall future-oriented gate concept with IT integration has not been implemented yet. The actual physical situation at the gates and the access procedures for vehicles are leading into frequent heavy traffic congestions on the terminal already today which affects operation. Future traffic increases will make this situation more difficult.

22 Strategic Master Plan for Chittagong Port Final Report, Part 2 5 To control this increased amount of traffic in the future, an overall integrated gate concept including truck announcement, pregate clarification, electronic access control and CTMS integration is required. The main idea in this concept will be to integrate the requirements for safety, security and operations in the gate processes for all kinds of cargo flow and all kinds of vehicles or persons who request to enter the port area. This coordination will be even more important if additional container terminal operators will be working in the port. In order to be able to optimise the use of the CTMS system on the existing container terminals and to increase terminal capacity, container stripping activities and the subsequent intensive vehicle traffic in the RTG areas should be moved to other areas. A clear separation of areas between full-container operation and cargo operation including stripping will provide major advantages for the container terminal areas. Finally, after having been upgraded to a later version, the CTMS should be introduced in the non-containerised cargo areas where a higher degree of efficiency can be achieved with the use of this system. Regarding the future development, the Consultants analysis underline the importance to establish regular container handling operations in Port of Chittagong, provided by operators that are rewarded long or mid-term concessions. Regular container handling operations shall include the stacking of export containers before commencement of loading operation this is a condition to achieve acceptable vessel turn-around times. Stacking of all export containers, full or empty, requires more slot capacities in the port than currently available. It is necessary to increase the yard capacity in all parts of the port (NCT might be the exemption as it is not fully developed yet) in order to meet the installed quay handling capacity. As the vast majority of export containers are currently directly loaded from external trucks, the increase of the yard capacity will not yield a proportional increase of the terminal capacity. The gain of yard expansion will be in the vessel turn-around time, not in nominal throughput capacities. In order to establish regular container handling operations at the current container terminals in Chittagong Port, the following measures are proposed: CPA should change its current practise of berth assignment, so the terminals and operators could be free to compete for vessel calls, including a liberalisation of the port tariff,

23 6 Strategic Master Plan for Chittagong Port Final Report, Part 2 Establish container terminal concessions for the operation of the different container terminals with the aim to improve handling productivity. The benefit of private concessions is seen on the investment side of the project. Private concessionaires are normally, depending on the concession agreement, obliged to invest in equipment, superstructure and even infrastructure. In return, private concessions are granted for longer periods, counting often several decades. Typical concession durations are in the range of 20 to 35 years. For projects with the infrastructure already developed, i.e. NCT or CCT, concessions could be shorter as the capex requirements for the concessionaire would be lower. The NCT Container Terminal needs urgently to be equipped with STS Gantry Cranes as the basis for standard terminal handling capacities and performance. At least the first batch of six STS should be purchased by CPA. With a lead time of 24 months, action needs to be taken immediately, The CCT Container Terminal needs to be upgraded and additional stacking capacity is needed in order to establish independent operations at CCT. This a pre-requisite to enable an independent concession for the terminal, The future development of Chittagong Port should foresee a facility for inland water way vessels. These vessels have lengths of below 80m; currently deployed vessels have an LOA of 73m. It is proposed to consider a dedicated berth with a total quay length of 187m, where two berths for inland waterway vessels could be established which should be served by Mobile Harbour Cranes (MHCs). To meet the forecast future large increased container volumes, it is important to first identify the requirements for the new terminals in form of a gap analysis.the gap analysis compares the already installed container handling capacities (plus some improvement potential) of the existing container terminals with the future container handling volumes gained from the traffic forecast. The carried out gap analysis is based on the following assumptions: CCT will increase its current annual handling capacity of 520,000 TEUs by 1% each year by improvement measures NCT will increase its current annual handling capacity of 400,000 TEUs to 700,000 TEUs after completion of NCT1 in 2017 and from thereon by 1% each year by improvement measures Up from 2017 onwards another 300,000 TEU annual handling capacity (NCT2) will be available, also increasing by 1% each year by improvement measures

24 Strategic Master Plan for Chittagong Port Final Report, Part 2 7 GCB will maintain its current annual handling capacity of 850,000 TEUs until Then the container handling capacity will be reduced stepwise and will disappear up from 2024 onwards when the new Bay Container Terminal (BC) will be fully operational. To meet the forecast increasing container volumes the following recommendations are made: The fastest way of increasing the handling capacity in the port would be the transition of parts of GCB area into a full independent container terminal that can be licensed to a private operator. The transition should be realised at berths 10 to 13 (Karnaphuli Container Terminal, KCT 1). The KCT 1 Container Terminal is planned to have a capacity of 770,000 TEU. To be able to provide the required container terminal capacity, the KCT 1 needs to be in operation 2020, according to the gap analysis. It is recommended to immediately start with the planning of this terminal. Parallel with these activities, it is also recommended to immediately start with the planning of the new Bay Container Terminal which will be required from 2023 to meet the forecast container volumes with a capacity of 2.8 million TEU. It is estimated that between 2018 and 2022 there will be a capacity lack (751,000 TEU) which have to be compensated by temporary measures. It is proposed to use feeder barge system that has been introduced in the port of Hamburg in order to unburden the container terminals in peak situations. With regard to the most preferred alternative for new container terminal capacity, different locations have been considered: The Patenga Container Terminal would be too close to the airport which could lead to height restrictions for container cranes, thus not being viable. The site for the River Terminal opposite of Patenga completely lacks infrastructure, without any road or rail connectivity to Chittagong and Dhaka and is therefore not considered as feasible. The Bay Container Terminal would be located next to the Port Link Road, connecting the N1 highway to Dhaka with the existing port. The railway line Chittagong Dhaka is within close vicinity. The draft restrictions would be only slightly better than at the existing port, but LOA restrictions due to the navigability of the river would no longer apply. Due to its location the Bay Container Terminal (BCT) would technically be more feasible than the other sites and thus could be seen as the favourite alternative.

25 8 Strategic Master Plan for Chittagong Port Final Report, Part 2 For the future handling of general cargo and break bulk it is recommended to develop a new Multi-Purpose Terminal (MPT) facility to be able to handle these terminals. The new terminal facility should be able to handle up to 4.7 million tonnes of non-containerised import cargo until The proposed concept foresees that six berths are required with a length of 1,475 metres at the current berths 1-9. A new 1,475 meter long quay wall shall be constructed, which will follow the existing alignment of GCB berths. The new quay wall is proposed to be constructed as concrete deck on piles, similar to the NCT berths. This type of construction is widely used in Bangladesh and is adapted to local unfavourable subsoil conditions. The planned new quay wall can accommodate up to six (6) ships depending on length and size. The capacity calculation is based on six ships, in which each vessel is occupying 200m berth length, including a 12m forward and aft safety distance between the six ships. The annual volume of general and break bulk cargo projected is increasing from 4.1 million tonnes in 2015 to 4.7 million tonnes in 2043, whereby approximately 20% annually are stored as per Client s information, taking into consideration that the now and on-going dominating direct delivery of 80% is not decreasing or interrupted due to terminal gate closing during night shift operations. It is planned that the terminal will operate in 24 hours-7 days per week modus in a 3-shift system whenever a vessel is alongside. The ports terminal gates are open for the public/consignees 7 days a week and, daily round the clock. Ship discharge operation is performed in a 3-shift system as long as a vessel is not completed. In case of temporary closure of the gates, e.g. due to force majeure, fire and/or security reasons a pre-planned amount of trucks to continue to be loaded for direct delivery must enter the gates well in advance before they are closed and parked inside terminals premises. Therefore ample space has to be pre-planned for at least trucks to serve at least two vessels. The financial assessments of the planned investments into the proposed expansion projects show that: the Karnaphuli Container Terminal (KCT 1), the Bay Container Terminal (BCT) and the new Multi-Purpose Terminal (MPT), have to be considered not only necessary from an operational and capacity point of view, but also are viable financially. The financial calculations indicate (IRR, NPV) that it would allow for implementing concession agreements with a private

26 Strategic Master Plan for Chittagong Port Final Report, Part 2 9 operator, that maintains competitive and economically bearable handling rates, at the respective terminals. As a part of the Strategic Master Plan for Chittagong Port, a preliminary environmental assessment, social assessment, and assessment of the potential need for land acquisition and resettlement have been carried out are are presented in the Final Report, Part 3. That report contains also a hinterland capacity estimation, and economic assessment of Chittagong Port s Masterplan as well as an overview of possible recommended organisational changes at Chittagong Port Authority (CPA).

27 10 Strategic Master Plan for Chittagong Port Final Report, Part 2

28 Strategic Master Plan for Chittagong Port Final Report, Part INTRODUCTION 1.1 Background Bangladesh extends to 147,570 km² (56,977 square miles) with a population estimate of 150 million people in 2013 according to the IMF and a population density of 1,033.5/km² (2,676.8/square mile), which makes Bangladesh one of the most densely populated countries in the world. Bangladesh has experienced an annual economic growth in the range of 6.1 to 6.7% during the last five year period. The economic growth combined with the increasing trade has increased the pressure on Bangladesh main port, Chittagong Port. Chittagong is the principal sea port of Bangladesh, situated in the south of Bangladesh, handling more than 92% of the sea-born trade. The port is basically a river port situated 16 km upstream from the Bay of Bengal. During the last fiscal year 2012 Chittagong Port handled million tonnes of cargo, including 1.41 million TEU of container cargo, corresponding to an average annual growth rate of 8.1% respectively 10.1%. The port has successively changed and adapted the handling facilities with a focus on container handling. This has led to a narrowing scope for handling of break-bulk and bulk cargos and there is a need for investigating different expansion possibilities. Additionally, it is important to improve the current hinterland connections and improve the different intermodal connections and links. The road and railway links between Chittagong and Dhaka are facing capacity bottlenecks, but different ADB financed projects to improve the situation are in progress. The important role of Chittagong Port for Bangladesh underlines the necessity of investigating how the port should be developed best to meet the future challenges. All pervious development plans for the port are outdated and the last Chittagong Port Master Plan covered the period Against this background the government of Bangladesh has approached ADB with the aim of preparing a new Chittagong Port Master Plan for the coming years. The aim of the Port Master Plan should be to improve the capacity of Chittagong Port which will support and maintain sustainable economic growth in Bangladesh by ensuring access to the international markets. HPC is carrying out the study in cooperation with: Sellhorn Ingenieurgesellschft mbh, Germany; and KS Consultants Limited, Dhaka, Bangladesh.

29 12 Strategic Master Plan for Chittagong Port Final Report, Part Project Objective and Scope The overall objective of the assignment is the elaboration of a Strategic Master Plan for the development of the Chittagong Port in Bangladesh. The Strategic Master Plan serves also as a tool to identify potential projects to be funded under PPP schemes, or directly by ADB. To meet the general objective, the following specific objectives, as outlined in the ToR, shall be achieved: Understanding the role of the Port of Chittagong in the Bangladeshi international trade and elaboration of a long-term traffic forecast for all the commodities currently handled. In-depth assessment of the port infrastructure (waterside and landside), the hydraulic features of the river and the hinterland connectivity. In-depth assessment of current port operations, maintenance and port security, comparing them with international benchmarking and best practices, identifying inefficiencies and bottlenecks. Propose different alternatives to improve the port facilities and the navigability of the Karnaphuli River, taking into account the findings and results of previous steps. Prepare a cost estimation for the implementation of the improvement plans. Elaboration of a preliminary environmental assessment of the projects to be included in the Strategic Master Plan, covering also social impacts derived from resettlement of citizens. Preparation of a comprehensive Strategic Master Plan for the Port of Chittagong, including all the aspects analysed during previous steps, as the best tool for the development of the port during the next years. This plan must indicate required modifications of policies regarding port manpower, rules and regulations, as well as alternative sources of financing.

30 Strategic Master Plan for Chittagong Port Final Report, Part The Role of This Report In the project there will be a total of five reports submitted. The following reports are defined in the TOR: Table 1: Reporting Type of Report Inception Report incl. ToR for detailed hydraulic and hydrologic study of Karnaphuli River Interim Report 1 Interim Report 2 Draft Final Report Final Report Indicative Reporting Time Plan Within four weeks after project start Six months after project start 12 months after project start 21 months after project start 24 months after project start The original time plan has been changed and extended due to problems caused by the riot and political unrest end of 2013 and in the beginning of 2014 in relation to the election. This report Final Report; Part 2 - presents an overview of the current situation, identified problems in the port and identified necessary expansion projects to meet the future trade volumes for Chittagong Port and Bangladesh. This report presents initially an analysis of the current port facilities and operations followed by a description and analysis of Chittagong port s equipment and maintenance facilities and the used IT-systems and organisation. Thereafter, the programme for recommended actions for performance improvement describes the relevant proposed improvement measures for the different container terminals. After this analysis the different port development alternatives are presented, starting with a comparison of the current handling capacity with the forecast demand development. The development alternatives are presented for the NCT container terminal, Karnaphuli container terminal, the Bay Container Terminal as well as for the Bulk and General Cargo Terminals. Finally, an environmental assessment of the development alternatives is presented.

31 14 Strategic Master Plan for Chittagong Port Final Report, Part 2

32 Strategic Master Plan for Chittagong Port Final Report, Part CHITTAGONG TRAFFIC INTEGRATION This section discusses the Port of Chittagong in the context of water- and landside traffic. Focus is laid on the public port, comprising the GCB berth, NCT and CCT. These are relevant for performance reviews, will be subject to short term action plans and would be affected by expansion projects of the port, as discussed in the subsequent sections of this report. The present section provides key input for the remainder of the report by quantifying the global traffic for different transport modes of inbound and outbound traffic. The section introduces the current Customs regulations, i.e. the main regulating framework for border crossing cargo transport and its integration with the port procedures. It also provides an overview of the current city development plans and their impact on the port s future inland connectivity. 2.1 Major Cargo Flows at the Public Port The following figure illustrates the container split based on 2012 figures. The terms of import fetches and export delivery are mainly determined by Customs regulations, as discussed below. Figure 1: Container Flows at CGP, 2012 Based Estimations Source: HPC 2014, based on data provided by CPA. CPA could not provide more recent data.

33 16 Strategic Master Plan for Chittagong Port Final Report, Part 2 Any deviation from the figures underlying the traffic forecast are due to different data sources at CPA but can be neglected due to limited magnitude. It can be seen that the container cycle at Chittagong is almost closed. Only small quantities of containers are transferred to Dhaka or other places in the country. The difference between imports and exports could even be accounted for by end of period balances alone. It is assumed by CPA management that some 25% of all empty containers after stripping remain in the port (status storage ) for back-loading and repositioning of empty containers. The depots play a significant role in the present logistics setup. The more so, as these depots also received in 2012 some 20,000 empty containers from consignees and delivered a somehow similar figure to exporters. Table 2: Container Flows, 2012 Container Type Boxes Share Export Full 20' 85, % Full 40' 167, % Empty 20' 170, % Empty 40' 54, % LCL 0 0.0% TTL 478,988 Import Full 20' 252, % Full 40' 190, % Empty 20' % Empty 40' 21, % LCL 18, % TTL 484,136 Source: HPC 2014, based on data provided by CPA In more detail, the above table shows that empty container imports are almost exclusively 40 feet containers, required for the exports of the volume cargo of the garment industry. There are a considerable number of empty 20 feet containers loading, which is almost exactly the balance of the full 20 feet imports and the full 20 feet exports. While the country imports huge volumes of tonnage cargoes like steel scrap or chemicals which comes in 20 feet containers, exports are mainly in volume cargo.