By Kay Kimsong and Adam Piore
THE CAMBODIA DAILY
Sihanoukville Port could certainly use more business. The port was operating at only 55-percent capacity through the first six months of the year—bringing in about $1 million a month in revenue.
Sihanoukville - Sihanoukville Port officials plan to construct a new 160-hectare "East Port" facility to support oil exploration and extraction teams working in the Gulf of Thailand.
Port officials plan to build the multimillion-dollar facilities on state-owned land, located near the airport and 18 km from the deep-water port, with facilities to rival those of oil-producing nations, Norng Soyeth, marketing director of the port, said last week.
Sihanoukville's port officials are basing their plans for the massive new development on the assumption that international oil companies will eventually hit oil in six or seven offshore blocks in the years to come—which could mean billions of dollars in gas and oil revenue for Cambodia.
"There will be a benefit for all, for the nation, for the people, for the city and for Chevron," Norng Soyeth said.
Chevron signed an agreement in April to rent space in the main Sihanoukville port area, renting 5,000 square meters of space for $12,000 a month to store drilling rods. The oil giant discovered oil in five test wells dug offshore in "block A" late last year. They plan to begin drilling 10 more test wells later this month—and have already shipped in 3,000 tons of equipment to do so.
But Norng Soyeth says port officials are expecting that oil companies will eventually tap at least six or seven additional offshore blocks. Companies such as Chevron and Japanese giant Mitsui will need a logistical base with offices and warehouses, roads, open space storage and a well-trained staff familiar with the needs of oil operators working off shore.
"The area will be standardized-up to American standards," he said. "One hour means one hour."
Last week, Sihanoukville port management approached the Japanese Embassy to request a $10 million business loan for the project. They plan to meet Wednesday with the Council for the Development of Cambodia to explain why the East Port is important, said Lou Kim Chhun, director general of the port.
"In other countries, there is a special port to provide service to oil and gas companies," he said.
Sihanoukville Port could certainly use more business. The port was operating at only 55-percent capacity through the first six months of the year—bringing in about $1 million a month in revenue. Based on numbers from the first six months of 2006, gross throughput of goods at the port is on pace to top last year's numbers by about 10 percent.
But such an increase would still leave the port with less activity than it enjoyed in 2003.
The decline is largely due to the overall expansion of Cambodia's port facilities. The Mong Reththy Group opened a private port in the last couple of years in Koh Kong province's Sre Amble and now directly competes for clients with Sihanoukville.
Tann Monivann of the Mong Reththy Group maintains that his company goes after different clients.
"Cargo coming through my port [has] small shipments," he said, like fruit and cement. "I don't understand why Sihanoukville is worried about competing with my small port."
"Some come through my port because it is closer than Sihanoukville and traders don’t need to pay toll road fees on National Route 4," he said.
They may also prefer security requirements and government oversight that is less stringent, Sihanoukville Port officials say. In order to move cargo to US ports, Sihanoukville has had to standardize its procedures to meet post-Sept 11, 2001, security procedures involving scanning.
The price could be reduced, Norng Soyeth said, if the government obtained its own scanning machine. Currently, AZ, a private company, does the scanning.
"It’s very hard to compete with the shallow port," Norng Soyeth said.
"This is an international port with international standards. We put a lot of capital into developing it because we have to meet those standards."
Soung Heng, secretary of state at the Ministry of Public Works and Transport, said his ministry is in the midst of creating a working group to better oversee the activities of the country's private ports, which have been expanding both on Cambodia's coast and on its rivers in recent years.
Sihanoukville - Sihanoukville Port officials plan to construct a new 160-hectare "East Port" facility to support oil exploration and extraction teams working in the Gulf of Thailand.
Port officials plan to build the multimillion-dollar facilities on state-owned land, located near the airport and 18 km from the deep-water port, with facilities to rival those of oil-producing nations, Norng Soyeth, marketing director of the port, said last week.
Sihanoukville's port officials are basing their plans for the massive new development on the assumption that international oil companies will eventually hit oil in six or seven offshore blocks in the years to come—which could mean billions of dollars in gas and oil revenue for Cambodia.
"There will be a benefit for all, for the nation, for the people, for the city and for Chevron," Norng Soyeth said.
Chevron signed an agreement in April to rent space in the main Sihanoukville port area, renting 5,000 square meters of space for $12,000 a month to store drilling rods. The oil giant discovered oil in five test wells dug offshore in "block A" late last year. They plan to begin drilling 10 more test wells later this month—and have already shipped in 3,000 tons of equipment to do so.
But Norng Soyeth says port officials are expecting that oil companies will eventually tap at least six or seven additional offshore blocks. Companies such as Chevron and Japanese giant Mitsui will need a logistical base with offices and warehouses, roads, open space storage and a well-trained staff familiar with the needs of oil operators working off shore.
"The area will be standardized-up to American standards," he said. "One hour means one hour."
Last week, Sihanoukville port management approached the Japanese Embassy to request a $10 million business loan for the project. They plan to meet Wednesday with the Council for the Development of Cambodia to explain why the East Port is important, said Lou Kim Chhun, director general of the port.
"In other countries, there is a special port to provide service to oil and gas companies," he said.
Sihanoukville Port could certainly use more business. The port was operating at only 55-percent capacity through the first six months of the year—bringing in about $1 million a month in revenue. Based on numbers from the first six months of 2006, gross throughput of goods at the port is on pace to top last year's numbers by about 10 percent.
But such an increase would still leave the port with less activity than it enjoyed in 2003.
The decline is largely due to the overall expansion of Cambodia's port facilities. The Mong Reththy Group opened a private port in the last couple of years in Koh Kong province's Sre Amble and now directly competes for clients with Sihanoukville.
Tann Monivann of the Mong Reththy Group maintains that his company goes after different clients.
"Cargo coming through my port [has] small shipments," he said, like fruit and cement. "I don't understand why Sihanoukville is worried about competing with my small port."
"Some come through my port because it is closer than Sihanoukville and traders don’t need to pay toll road fees on National Route 4," he said.
They may also prefer security requirements and government oversight that is less stringent, Sihanoukville Port officials say. In order to move cargo to US ports, Sihanoukville has had to standardize its procedures to meet post-Sept 11, 2001, security procedures involving scanning.
The price could be reduced, Norng Soyeth said, if the government obtained its own scanning machine. Currently, AZ, a private company, does the scanning.
"It’s very hard to compete with the shallow port," Norng Soyeth said.
"This is an international port with international standards. We put a lot of capital into developing it because we have to meet those standards."
Soung Heng, secretary of state at the Ministry of Public Works and Transport, said his ministry is in the midst of creating a working group to better oversee the activities of the country's private ports, which have been expanding both on Cambodia's coast and on its rivers in recent years.
1 comment:
Great progress... Keep up with import/export, Cambodian economy is on the verge of growing. Just like in the west, richer get richer. Labor law must be improved for the workors.
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