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Tenders for concession of Olvia and KSTP were announced

12 September 2019, 10:10

Tenders for concession of Olvia and KSTP were announced

The Ministry of Infrastructure announced tenders for concession of the property of ‘Stevedoring Company (SC) Olvia’ and SE ‘Kherson Sea Trade Port (KSTP)’ as well as the corresponding property of SE ‘Ukrainian Sea Ports Authority’ (USPA). The respective announcement was published in the Uriadovy Kurier newspaper on Thursday.

As the USPA press service specified, following the second publication in Holos Ukrainy newspaper the potential investors will have 60 days to submit their tenders. The successful tenderers may be announced before the end of 2019.

 ‘The beginning of pilot concession tenders is an important event for the port industry of Ukraine. From that moment, the possibilities of public-private partnerships in ports have been expanded owing to the mechanism of concession well-established in Europe and throughout the world. The anticipated investment in development of the stevedoring companies ‘Olvia’ and ‘Kherson’ is more than USD 65 million. The USPA will become one of the parties to the concession agreements and will coordinate implementation of the projects under the systemic development of port infrastructure’, informed the Acting Chairman of the USPA, Raivis Veckagans.

Agreements will be signed with the successful tenderers, the parties to which will include the Ministry of Infrastructure, the USPA, the winner of tender as well as the company (SPV) to be established and registered in Ukraine by the winner of tender to implement the project. The Ministry of Infrastructure will be the authority providing concession based on the results of the concession tender.

Property of the state stevedore ‘Olvia’ is to be transferred to the concession for 35 years, property of KSTP - for 30 years. At the same time, it will remain in the state ownership and upon completion of the term of the concession agreements will be transferred to the state with all facilities built or modernized by the investor during his operation.

At the end of August 2019, the Minister of Infrastructure Volodymyr Omelian signed orders to announce tenders for concession of SE ‘SC ‘Olvia’’ and SE ‘KSTP’.  ‘In the nearest future, the relevant announcements about opening of the tender will be publicly published’, Omelian reported.

SE ‘SC’ Olvia’’ and SE ‘KSTP’ are the sites for implementation of the pilot concession projects in the port industry. The Ministry of Infrastructure approved pilot projects on June 23, 2016. A consortium of international consultants formed by the EBRD and the IFC developed feasibility studies for the pilot projects. While elaborating the feasibility study, a systematic analysis of the market was conducted, financial, technical, environmental and legal due diligence was carried out.

Feasibility studies were reviewed with participation of representatives of the work collective of state stevedores and local authorities, and were approved by the Ministry of Infrastructure and the Ministry of Economic Development and Trade taking into consideration guarantees of further employment of the workers of state enterprises.

More than 25 Ukrainian and foreign companies expressed their interest in the concession of state stevedores ‘Olvia’’ and ‘KSTP’ including Bunge, COFCO, Mitsubishi Corporation, Posco, Metinvest, Portinvest, Ukrrichflot, Dnipro Cargo Limited and others.

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