New Priok to pick operator by end-January
PSA International, APM Terminals, Mitsui Group or any party which can "bring in big ships" to berth at Indonesia's deepwater container port, New Priok, will be named operator partner at the end of January, Cargonews Asia reports.
RJ Lino, president director of Indonesia Port Corporation II (IPC II), that will be the 51 per cent majority shareholder of New Priok, told Business Times Singapore that his hope is that the enlarged Tanjung Priok port complex will become Indonesia's major transhipment port.
"One of the main considerations (for choosing the operator) is if they can bring the big ships to Tanjung Priok (Indonesia's largest port outside of Jakarta)," Lino said.
"APM Terminals is related to Maersk Line, and Mitsui Group associated with NYK Line, Mitsui and Evergreen, for example."
Lino said IPC II hopes to sign the memoranda of understanding with the international partner for phase one by end-January.
He said New Priok would be Indonesia's transhipment port for shipping lines by 2015 as the existing Tanjung Priok container port is over-utilised.
Tanjung Priok's throughput is expected to exceed seven million TEUs by end-2012, and by IPC II's projections, still requires two million TEUs of capacity till 2017, when New Priok's first phase is completely ready in 2017.
In 2011, 18 per cent of containers handled by Tanjung Priok were transhipped in Singapore or at Malaysia's Tanjung Pelepas and Port Klang, while the remaining 82 per cent of throughput was bound for domestic consumption. But New Priok may change the transhipment ratio.
New Priok, to be linked to Tanjung Priok by a 7 km road, promises to introduce another five million TEUs and will have deeper draught to accommodate 10,000 TEUs and larger ships.
Together with phases two and three, New Priok will add 18 million TEUs of capacity when fully ready in 2023.
Lino believes the New Priok-Tanjung Priok complex could win Indonesia a place in South-South trade between Far East economies and Latin America, which now has European ports as an intermediary.
"The shortest way will be to go through (Indonesia's) Sunda Straits. So goods will start in the Far East, pass through the Sunda Straits, Indian Ocean, South Atlantic and then to Brazil and Argentina," he said. "New Priok will become the last port of embarkation."
New Priok is part of Indonesian President Susilo Bambang Yudhoyono's US$12 billion port infrastructure plan to build special economic zones in the archipelago nation by 2025.
New Priok will be one of six main deep-water container ports that will be linked through a main sea corridor called the "East-West Pendulum".
The East-West Pendulum, said Lino, would help distribute economic development away from built-up Java towards Indonesia's less urbanised and industrialised parts in the east.
At the moment, to transport containers by sea freight from Tanjung Priok to Sorong in Indonesia's east costs $2,000 a box, compared to $250 if they are sent via Singapore to Sorong.
That is because Sorong's ports can accommodate only smaller ships and therefore smaller volumes of shipment, said Lino. This discourages industrialisation in Sorong.
However, the development of a larger deep-water port in Sorong and the start of a pendulum service of ships from Jakarta to Sorong will lower costs drastically to $375 a box.
R J Lino, president director of Indonesia Port Corporation II, that will be the 51 per cent majority shareholder of New Priok, said that his hope is that the enlarged Tanjung Priok port complex will become Indonesia's major transhipment port.
