Relevant topics

2018 September 21

Feodosia rejects the cement terminal

Crimean authorities have decided to reject the construction of a cement transshipment terminal at the port of Feodosia. The terminal estimated at RUB 111 million is to handle cement coming to Crimea from the Krasnodar Territory. Officials say the investor is dragging out the works and the terminal will harm the environment. The investor disagrees with the authorities while it can lose RUB 56 million of investments.

Investment project in disgrace

The authorities of the Crimea’s Feodosia have opposed the investment project on construction of a cement terminal in the city port. According to the local administration, the terminal will harm the environment and will hinder operations in the port.

“I am against a cement terminal in our city … In case of an above-ground line the activities of the entire port including cranes and equipment will be blocked. It will present a real threat for city ecology, not to mention the logistics. Construction of an underground line will face lots of difficulties with some of them being inextricable, perhaps,” said Sergey Fomich, head of Feodosia Administration.
The project investor, YugGidroStroy, signed an investment agreement in July 2016. According to it, the terminal was to be launched in March 2017. However, the land acquisition has not been completed yet, says the statement. In 2018, the investor shifted the deadline of the construction having not applied to the city administration or the port authorities. The allotted territory is standing idle causing income deficiency for the port of Feodosia, says the statement.

Sergey Fomich is going to share his concerns with Crimea head Sergey Akseonov and ask him renounce the terminal construction.

Anatoly Volkov, head of SUE Crimean Sea Ports refused to comment. The Ministry of Transport of Crimea forwarded the query to the Ministry of Economic Development, which ignored the query.
According to the official statement of the Ministry of Economic Development of Crimea, the authorities are going to offer the investor a new territory outside the city.

As Mikhail Koren, Director of YugGidroStroy, told IAA PortNews, the terminal estimated at RUB 111 million is to have a capacity of 10,000 tonnes per month. The cement is to be purchased from Novoroscement in the Krasnodar Territory and delivered via Novorossiysk or Temryuk to the port of Feodosia where it is to be packaged by 20–50 kg for distribution among building material stores of Crimea with the rest to be sold in bulk and transported mainly by railway transport.

“I disagree with the authorities’ decision. The reasons they are based on are not of legal nature. Our project has not been renounced legally. We had been offered an alternative plot of land but we have not agreed or rejected yet. So far, we have come to an agreement to continue an assessment of the project’s environmental impact. We will think about our further activities upon obtaining the results”, said Mikhail Korol.

According to him, the company has already spent RUB 54 million for the purchase of equipment and RUB 2 million for the development of design documentation. If the construction is shifted to another site, this amount will never return.

Mikhail Korol says the environmental claims of the authorities are baseless. “Environmental friendliness was the top priority of our project. All standards are taken into consideration and the scope of transshipment is not high. There quite many industrial enterprises in the city of Feodosia that can be harmful for the environment. There is an oil farm and concrete plant with no claims raised”, he said   .

As for the construction delay, the head of the investing company blames it on authorities. “That is because of red tape and frequent reshuffling of management at Crimean Sea Ports and at the Ministry. Every time we had to present our position again. Besides, the investment agreement provides for assistance from the authorities of the Republic, municipality and SUE. Throughout the entire period there was no support from them. Paperwork was always dragged out at SUE, estimation activities were not performed in time either”, he says.

It is not clear why this project incurred displeasure of the authorities two years after approval. According to Mikhail Korol, the investor obtained all approvals in 2016, including those from Feodosia Administration. He says the approval then emphasized the significance of the project for the city. 

It should be noted that the report of Feodosia head signed in April 2018 says that the project of YugGidroStroy is among other projects on capital investments. Nothing says that the cement terminal is harmful for the city.

Aleksandr Alikin