South Asia Gateway Terminals (SAGT)

completed

Summary Of Project Information (SPI)Project Name:Sri Lanka: South Asia Gateway Terminals (SAGT)Region:AsiaSector:Project No:007974Projected Board Date:March 3, 1999Company Name:South Asia Gateway Terminals (Private) LimitedTechnical Partner and/or Major Shareholders SAGT''s shareholders include: P&O Netherlands B.V., a subsidiary of the P&O Group, an international conglomerate with interests in shipping and port operation; P&O Nedlloyd B.V., owned by Royal Nedlloyd N.V., a major shipping company, and the P&O Group, ; John Keells Holdings Limited, a Sri Lankan group active in tourism, transportation and financial services activities; Evergreen, a major Taiwanese shipping group; and the Sri Lanka Ports Authority.Project Cost Including proposed IFC investment The estimated project cost is US$240 million including civil works, equipment, contingencies, working capital and financing fees. IFC''s proposed investment would include an A Loan of up to US$35 million and an equity investment of approximately US$7.3 million for a 7.5% shareholding in SAGT.Location of project and Description of site The project is located in the Port of Colombo. The Port of Colombo has two major container terminals: Jaya Container Terminal and the Queen Elizabeth Quay ("QEQ"). The SAGT terminal at QEQ will be formed by increasing the width of the present quay by 100 m. into the harbor basin over a 940 m. long stretch and constructing a new container quay, with 15 m. water depth, prolonged in the southern end by a 180 m. passenger quay. The storage area behind the quay will be extended by approximately 180 m. to the North. Description of Company and Purpose of Project The project is being developed as a 30-year build-operate-transfer (BOT) project granted by the Sri Lanka Ports Authority, to South Asia Gateway Terminals (Private) Limited. The Project is intended to increase the capacity of the Terminal from 260,000 Teu to about 1.1 million Teu. This is a joint venture project with the Asian Development Bank and the Commonwealth Development Corporation. This will be the first privately operated terminal in Sri Lanka. Accordingly, IFC''s support is expected to have an important demonstration impact on the restructuring of the port sector in the region, an objective supported by the World Bank.Environmental Category and Issues This is a category B project according to IFC''s environmental review procedure, because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. IFC’s Technical and Environmental Department staff’s review of this project consisted of appraising technical and environmental information submitted by the project sponsor. The following potential environmental, safety and health impacts of the project were analyzed: disposal of dredged spoils, liquid and solid waste management; shipboard waste oil management, demolition/construction waste disposal; spill/emergency response and prevention, and employee health and safety. The sponsor has presented plans to address these issues and to demonstrate that the proposed project will comply with applicable Sri Lanka laws and meet World Bank environmental, health and safety policies and guidelines. SAGT has also committed to the completion of additional studies before disbursement to address such issues as: disposal of dredged spoil and hazardous construction materials, waste oil disposal; an environment, health and safety plan and manual.IFC will monitor ongoing compliance with World Bank environmental, health and safety guidelines during the lifetime of the project by evaluating reports submitted annually to IFC by SAGT and by conducting periodic supervision.The is from the InfoShop.Date SPI sent to InfoShop      February 2, 1999“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”For Additional Information contact: Corporate Relations Unit -telephone: (202) 473-7711facsimile: (202) 974-4384Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).