State seeks Lamu port and transport corridor investors

Investors are being sought to develop the multi-billion Lamu port and another transport corridor linking Kenya to southern Sudan and Ethiopia.

The projects are intended to ease the pressure of road traffic on the Mombasa - Malaba highway as well as the Mombasa Port and will open up the remote northern regions.

Eligible firms are required to prove at least 10 years experience in related works as well as provide financial statements for the past five years, by the deadline of October 15.

Transport permanent secretary Mr Cyrus Njiru said development of the port was the first in a series of projects whose studies were near completion.

“There are many components of the project. First, we have advertised for the port. The rest will follow when the final designs are completed,” said Mr Njiru by phone.

The planned works include dredging and reclamation of land as well as construction of associated infrastructure such as access roads, railways, ware houses and buildings for the three berths.

Last year, the Cabinet endorsed the $16 billion (about Sh1.28 trillion) construction works to begin in June, following recommendations of the project’s viability in order to position the country as a major transshipment hub.

The proposed railway will run from corridor run from Manda Bay, Lamu to Addis Ababa, on to Juba.

The regions to be served by the port will be connected by a standard railway gauge with a capacity to handle trains moving at 160 kph when the project is finally completed in 2015.

The developments are important amidst recovery in shipping from the global economic recession.

During 2009, global container volumes dropped by about 12 per cent thus for the first time experienced negative growth in the history of container trade.

To brave the hard times, shipping lines and terminal operators have been reviewing options for cutting down costs and optimise resource utilization.

But in recent months, KPA has seen some recovery.

“We are seeing large ships entering the market motivated by economies of scale while terminal operators have temporarily delayed capacity expansion as they wait for the recession to fully ebb in three years time,” said Mr Gichira Ndua, KPA’s new managing director.

The proposed port is expected to have a total of 22 berths with a quay that will lie on 1,000 acres.

It will serve the Ethiopian market, currently served by Djibouti port and Southern Sudan which relies on Port Sudan.

Maritime experts say that the future of transshipment business in Kenya lies in the construction of a second port in Lamu, which due to its deep waters will give it capacity to accommodate large vessels currently preferred by the shipping lines.

The Mombasa port has a channel of water depth of about 10 metres and cannot accommodate new generation vessels.

Even without the planned dredging. Lamu has an entrance channel depth of 18 metres and a basin depth of 16 metres making it one of the deepest in Africa.

Currently, shipping lines and cargo owners have a cost advantage by consolidating traffic on mother vessels calling in the port of Durban before distribution to East and West Africa.