KPA sets aside Sh618m to start Lamu port operations
KNA
Kenya Ports Authority (KPA) has set aside Sh618 million to enable the commencement of interim operations at the Lamu Port in two months’ time.
The interim operations will begin on June 15, with the first berth, which already has a container yard terminal fully in place to carry out initial logistics operations of the port.
Respective agencies tied to port operations have already commenced laying the groundwork for full operations, once all the three berths are completed later in October.
According to Abuldahi Samatar, General Manager in charge of the Lamu Port project, another Sh5.8 billion is also needed by the end of this financial year to ensure that port works for the container yard terminals 2 and 3 are complete.
He said disbursement of the funds was needed urgently to prevent the contractor, Chinese Construction and Communication Company from demobilising and leaving the port site awaiting funding.
KPA officials have revealed that it could cost the taxpayer as much as Sh1 billion to engage the contractor back to work in the event that they leave the site, stressing the urgency for the government to support the project to its optimal completion.
“We remain optimistic that the schedule to interim operationalisation of berth 1 will enable stakeholders to realise that the port project is finally coming to fruition,” said Dan Amadi, head Lamu Port Development Project.
Samatar said that with the operationalisation of the Lamu Port in June, KPA and the LAPSSET Corridor Development Authority (LCDA) are scheduled to send a high level marketing team to Ethiopia in a bid to offer them a better logistics deal in comparison to the one they may be getting from the port of Djibouti or the Port of Massawa in Eritrea.
“Being a new facility, there is need to incentivise the Lamu Port with better tariff rates that would make it competitive in the regional and global logistics market,” said Samatar.
To promote traffic into the new port, KPA have already put in place an extended a 30-day storage free period for transshipment and transit cargo, 14 days’ storage free period for domestic cargo and a 40 per cent discount for cargo-based charges as per the KPA tariff.
Harbour dues
“Light dues, port and harbour dues shall be charged once at the first port of call in the country, at either Lamu or Mombasa with Coasters carrying transshipment cargo from Lamu to Mombasa being offered a 40 per cent discount on the cargo handling charges,” a KPA management statement offers.
KPA had in July 2019 managed to convince more than 10 shipping lines to visit the port in a marketing strategy, aimed at attracting vessels to Lamu, underscoring the Lamu Port management’s commitment to ensuring port operations takes shape.
Samatar, however, admitted that even with the interim operationalisation of the Lamu Port project, operations are likely to be restrictive due to the lack of Ship to Shore (STS) Gantry cranes needed to enable unloading of goods from ships.
The senior KPA official further disclosed that it could cost KPA as much as Sh18 billion to acquire 12 new STSs required for the full operationalisation of the Lamu Port.
The equipment needed include Rubber-Tyred Gantry cranes (RTGs), terminal tractors, forklifts and reach stackers (for container handling) and pilot boats, tag boats and mooring equipment for handling of vessels.
The authority had in July 2019 called for supply of three-six tonne and two-five tonne forklifts. KPA is also installing navigation aids at the port.
“One berth however would need four STSs, and there are already plans to ferry some older cranes initially to aid in the interim operationalisation of the Lamu Port,” Samatar added.
According to logistics experts, it could take as long as 18 months to procure and install new STS gear, with KPA officials intimating that the ships that will initially dock at the Lamu Port will be those with their own gantry equipment.
