Batumi International Container Terminal

distressed

In September 2007, Batumi Port Holdings Ltd. (BPHL) granted a 48 year concession contract to develop and operate a container terminal and to operate a ferry and dry bulk handling facility in the Port of Batumi in Georgia to ICTSI Georgia Corp. BPHL has the exclusive management right over the state owned shares in Batumi Sea Port Ltd. (BSPL). ICTSI Georgia Corp was a subsidiary of Pilipino International Container Terminal Services Inc. (ICTSI). For the concession, ICTSI Georgia Corp was to pay a total concession fee to BPHL of US$31 million in four installments through 2008. Investment requirements would include the refurbishment of the two container terminal berths to allow the installation of quay cranes. At the time of the contract, the ferry terminal handled 52 ferry calls annually and the dry bulk handling facility handled 100,000 mt/year of general cargo. As part of the contract, BSPL granted a 48-year lease with an operating agreement in favor of Batumi International Container Terminal LLC (BICTL), which was an ICTSI unit established to operate in the Port of Batumi. Under the contract, BICTL became the exclusive container terminal operator in the port. The lease contract covered a total area of 13.6 hectares in the port, consisting of two berths (No. 4 and 5) for a container terminal, and one berth (No 6) as a ferry terminal and for dry bulk general cargoes. BICTL agreed to pay an annual rental of 60 cents/square meter for the first 18 months, increasing to $5.50/square meter thereafter. In July 2013, Georgian Batumi International Container Terminal (BICT) initiated arbitration proceedings to settle a dispute with its lessor Batumi Sea Port (BSP). BICT filed the request for arbitration with the London Court of International Arbitration to settle the dispute in accordance with the resolution mechanism under the lease agreement. there is no information on other bids for this concession