EghtesadOnline: Life Trade Promotion Company signed an agreement with Sistan-Baluchestan Ports and Maritime Organization on Wednesday to establish Iran’s first fully mechanized mineral export terminal in Chabahar’s Shahid Beheshti Port.
The terminal, with a mineral export capacity of 15 million tons per year, will come on stream in two years with an investment of 2.8 trillion rials ($66.6 million) by LTP Company.
According to the company’s Managing Director Mohammad Arazesh, the new “smart” terminal will be able to accommodate 100,000-ton cargo ships and vessels.
It will be constructed to the north of the coastal protection wall and east of Shahid Beheshti Port’s Berth No. 5. The terminal will be able to receive two ships simultaneously, Financial Tribune reported.
According to LTP’s website, the terminal will rely on machinery such as two wagon tippler stations each with a 25-wagon/hour capacity; truck loading and unloading depos with 67 trucks/hour capacity; stockyard containing a stacker with 2,500 tph capacity, a boom-type reclaimer with 2,500 tph capacity, and two combined stacker/reclaimer with 2,500 tph capacity each; two 2,500 tph ship loaders, and a 1,500 tph grab-type ship unloader; as well as an approximately 10-km-long network of belt conveyors.
“All the equipment will be purchased from European firms and comply with EU’s latest environmental standards,” Arazesh told Financial Tribune in a phone interview.
“The terminal will be fully capable of exporting finished steel products as well as upstream goods, iron ore, copper, chromite and coal.”
LTP Co. has a minimum transportation commitment to PMO and has already courted several big names in the mining sector.
An agreement is being drafted with Mokran Steel Complex located in Sistan-Baluchestan and talks are underway with Golgohar and Chadormalu iron ore complexes, Sabzevar Pars Steel Complex and Sangan Iron Ore Complex.
This is the first project LTP Co. has picked up since its inception, Arazesh added, noting that it’s part of a private holding and established with mineral projects in mind.
Save for Mokran, all the above-mentioned names are located in either central or northeastern Iran, and would have to deal with high road transportation costs to reach the port. The farthest is Sangan Mineral Zone in Khorasan Razavi Province, which holds over 1.2 billion tons of estimated iron ore reserves and is home to a large number of Iran’s mines and processing plants.
Arazesh, however, argues that transportation costs to the terminal will be the same as going over to Bandar Abbas Port, with the difference being lower seaborne export costs of about $1-1.5 per ton at Chabahar.
Located in southeastern Iran on the Sea of Oman, Chabahar is Iran’s only oceanic port. It consists of two separate ports: Shahid Kalantari and Shahid Beheshti.
The first phase of Shahid Beheshti Port was inaugurated by Rouhani in December last year.
The opening of the first phase of Shahid Beheshti Port (out of five phases defined for the project), which has tripled its capacity to 8.5 million tons (equal to that of all the northern ports of the country), will allow the docking of super-large container ships (between 100,000 DWT and 120,000 DWT).
Iran and India signed a lease agreement in February this year. The agreement means Iran is leasing a part of the area of the multipurpose and container terminal for 18 months for the Indian side to take over operations of port facilities in the first phase of the port development project.
India has committed $85 million for the development of Shahid Beheshti Port.
“With new moderated prices for services offered at Chabahar’s Shahid Beheshti Port, this southeastern Iranian port has turned into the cheapest option for doing business in the Persian Gulf and Oman Sea,” Mohammad Ali Hassanzadeh, the deputy head of Ports and Maritime Organization of Iran, said recently.
“Foreign ships belonging to international liners are entitled to a 90% discount on Terminal Handling Charges for a three-month period, followed by a 70% discount for the second three months, and then a 30% discount for the next six months. PMO will grant a 30% discount to international ship liners in their second year of operation in Chabahar. On top of that, more discounts will be offered on ports’ duties.”
The new mineral terminal at Shahid Beheshti Port, at least in theory, would be a boon to the Iranian mining industry as it has for years suffered lower global competitiveness due to high transportation costs and underdeveloped ports.
Iran is also aiming to become the world’s sixth largest steelmaker by the end of 2025, as part of the goals envisioned in the 20-Year Vision Plan. The plan stipulates establishing 55 million tons of crude steelmaking capacity by the deadline. If achieved, 20-25 million tons of the figure would be marked for exports, given the less than stellar demand outlook in the country.