Ennore Port Limited
(A Govt of India Undertaking)
First Floor, 23, Rajaji Salai, Chennai – 600 001.

ASSESSMENT OF PROJECT AND FINANCIAL RISKS FOR ENNORE PORT

Tender No. EPL/FIN/2008/1

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Invitation to Bid For Assessment of Project and Financial Risks for Ennore Port 1 Ennore Port Limited (EPL) intends to engage a consultant for Assessment of Project and Financial Risks and invites sealed bids from eligible bidders. 2 The tender document, including the Qualifying Requirements, can be obtained from the Ennore Port Limited, First Floor, 23, Rajaji Salai, Chennai – 600001 against payment of an amount of Rs.520.00 (Rupees Five Hundred Twenty only) including 4 % VAT, through a crossed Bank Demand Draft / Banker’s Cheque, in favour of ‘Ennore Port Limited’. The tender document, including the Qualifying Requirements, can also be downloaded from the EPL website, www.ennoreport.gov.in but an amount of Rs.520.00 (Rupees Five Hundred Twenty only), through a crossed Bank Demand Draft / Banker’s Cheque, in favour of ‘Ennore Port Limited’, shall invariably be required to be submitted along with the Bid. 3 The time line for the bid process is as follows: Issue of Tender Last Date & Time for receipt of Bid 13th October 2008 30th October 2008 at 1400 hoours

Date & Time of Opening of Technical Bids 30th October 2008 at 1500 hours Date & Time of Opening of Financial Bids Address for Communication To be notified later to the eligible bidders. Dy General Manager (Finance) & Secretary, Ennore Port Limited, First Floor, 23, Rajaji Salai, Chennai – 600 001.

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4 4.1

MINIMUM QUALIFYING REQUIREMENTS: The bidder should be a firm or a company having a minimum average annual turnover of Rupees five crores (Indian operations-from the consultancy business only) during the last three financial years.

4.2

The bidder should have successfully completed at least two (2) assignments with proven experience in carrying out Project Risks / Financial Risks study / analysis during the past five (5) years in power / telecom / infrastructure / FIs / Banking sectors.

4.3

The bidder should have minimum of three (3) full time consultants working in the firm.

4.4

The task team consisting of minimum two (2) identified members each having post qualification experience of at least ten (10) years or more on assignments in power / telecom / infrastructure / FIs / Banking sectors.

4.5

Further, members to have experience of studying risk analysis which may include identification of various risks, risk mitigation measures and action plans for the implementation of the same and the members should have completed at least two assignments during the last five (5) years.

4.6 4.7 4.8

Bidder must be having its Registered Office with legal presence in India. No consortium/ sub contracting shall be allowed to / with other firms. The Bidder shall submit all necessary documentary evidence to establish that the Bidder meets the Qualifications Requirements as detailed above.

4.9

No further discussion / interface will be granted to bidders whose bids have been disqualified. Ennore Port Limited reserves the right to accept or reject in part or full any or all the offers without assigning any reason whatsoever.

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5 5.1

TWO PART BIDDING The Proposals shall be prepared in two parts viz. Technical Bid and Financial Bid and shall be submitted in the following manner, in separate sealed envelopes in two copies, one marked as ORIGINAL and other copy marked as DUPLICATE with both copies duly signed and stamped on each page. The envelopes should be duly superscribed as follows: i. ii. Technical Bid (Unpriced Part) : Part A Financial Bid : Part B

5.2

Technical Bid

5.2.1 The Technical Bid should be submitted, preferably, in a bound form and all pages continuously and serially numbered as one document and shall comprise the following: i. The complete Qualifying Data as required in Clause 4 Qualifying Requirements. ii. iii. Bid proposals as per Form 1. Copy of audited / provisional Balance Sheet and Profit & Loss Statement for the last 3 years. iv. Rs.520/- (Rupees Five Hundred Twenty only) towards tender document cost in the form of Demand Draft / Bankers’ Cheque, if downloaded from the website. 5.3 Financial Bid

5.3.1 This part shall contain only Price Bid as per the bid Form 2. It is to be noted that the sealed envelope containing this part shall contain only price and no conditions whatsoever. Any conditions given in this part shall not be considered and if insisted upon by the bidder shall render the Bid liable for rejection.

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5.3.2 The Bidder shall quote in the appropriate Form lumpsum price (excluding Service Tax, if any, which will be reimbursed at actual rates, if applicable) for the entire scope of work covered under the RFP document. 6 6.1 Scope of Assignment Assessment of Project and Financial Risks • On own projects – i.e. Project being executed by EPL. • On projects executed by BOT Operators. • On projects considering the present and future business environment. • To scan internal and external risk assessment of the projects and suggest mitigation measures and action plan for implementation of the recommendation. • SWOT analysis, identification of risks, strategies and action plan. 7 7.1 DELIVERABLES Inception Report and Presentation – This will be provided within 7 days from the date of award. The consultant will describe the methodology being employed in conducting the assignment, identify any modifications to the proposed approach resulting from information gathered in the initial week, describe how counterpart staff are integrated into the activities being performed and identify any problems or issues related to obtaining data for the analysis. 7.2 Draft Final Report – This is to be provided within 45 days from the date of award. The draft Report will provide the project and financial risks and recommend actions. 7.3 Final Report – Comments on the draft final report will be taken into account in preparing the final report. The final report is to be provided within 60 days from the date of award.

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7.4

Any other deliverables, which are not specifically mentioned above but are found to be necessary during the assignment for successful completion of the assignment to the satisfaction of EPL.

7.5

At each stage, as desired by EPL, the consultant shall be required for interaction and attend review meetings / make presentations to EPL or any other agency at a time and place intimated by the Owner.

7.6

The Consultant shall work in close co-ordination with EPL, other consultants appointed by EPL and other agencies as may be required for satisfactory completion of the assignment.

7.7 7.8 7.9

Ten (10) sets of each of the above deliverables, will be submitted to EPL. All meetings and presentations will be held at places to be notified by EPL. All the data / inputs forming part of the final report must indicate the sources.

7.10 EPL shall be the owner of all these deliverables / inputs. 8 TERMS OF PAYMENT The payments would be released as per the following terms after achieving the milestones indicated therein: 8.1 Submission of the Inception Report by the consultant to the satisfaction of EPL : 20 % of contract value. 8.2 After submission of draft Final Report by the consultant to the satisfaction of EPL : 20% of contract value 8.3 After submission of Final Report by Consultant to the satisfaction of EPL : 30% of contract value 8.4 After acceptance of Final Report by EPL : 30% of contract value

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EPL’s RIGHT TO ACCEPT ANY BID AND TO REJECT ANY OR ALL BIDS:

9.1

EPL reserves the right to accept or reject any bid, and to annul the entire or part of bidding process and reject all bids at any time prior to award of Contract, without thereby incurring any liability to the affected Bidder of Bidders or any obligation to inform the affected Bidder or Bidders of the grounds for the EPL’s action.

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TIME SCHEDULE

10.1 Time is the essence of the contract. The entire work under the Assignment is scheduled to be completed in all respect within 60 days from the date of award of contract.

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Form 1 PARTICULARS OF THE FIRM AND ASSIGNMENTS CARRIED OUT BY THE FIRM
1. Name & Address of the Organisation :

2. Brief Description / Profile of the Organisation : 3. Outline of experience on assignments for power / telecom / infrastructure / FIs / Banks # : S. Name of No. Assignment 1 2 3 Date of Date of Commencement Completion Scope in brief Name of the task team members

Client

4. No. of consultants in the firms & their Bio-Data 5. Name & Profile of task team members

: :

6. Annual turnover during the last three financial years # 2007-08 2006-07 2005-06 Total Average Annual Turnover : : : ----------------: ----------------: -----------------

(Signature) Full Name: ______________ Address: _______________ Note: # Please attach documentary proof. 8

Form 2 (Financial Bid)
From _________________ _________________ _________________ _________________ Sir, Sub: Financial Bid for assessment of Project and Financial Risks for Ennore Port. Ref: Tender No.EPL/FIN/2008/1 We _______________________________________ consultant/consultancy firm To Dy. General Manager (Fin) & Secy. Ennore Port Limited First Floor, 23, Rajaji Salai, Chennai – 600 001

herewith enclose Financial Bid for selection of our firm as consultant for assisting EPL . The lump sum charges/price inclusive of tours, travel, out of pocket, accommodation and all related expenses for carrying out the entire scope of work is Rs. __________ (Rupees ________________________________). Service Tax and educational cess as applicable on the date(s) of payment(s) shall be paid over and above the price by EPL. The offer is valid for a period of 60 days from the date of opening of Bid.

Yours truly,

(Signature) Full Name: ______________ Address: _______________

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Information Memorandum Introduction Ennore Port was developed from a green field situation in East Coast of India at a distance of about 20km to the north of Chennai Port. This was declared as a Major Port under the Indian Ports Act, 1908 in March 1999 and incorporated as a Company ( Ennore Port Limited) under the Companies Act, 1956 in October, 1999. The Port was

commissioned in June, 2001 with two dedicated coal berths with 15m alongside depth and since then handles about 8.5 to 9 Million Tonnes of thermal coal per annum for the power stations of Tamil Nadu Electricity Board (TNEB). The Port also handle small quantities of Iron ore and POL through temporary facilities. The Port has initiated action for development of terminals through private sector participation to handle liquids, coal, iron ore and containers. The Port Management is functioning as a Land Lord Port with essential core staff. Vision, Goals and Strategy The Management vision for the next 20 years is that: Develop as a mega port with world class facilities to become the Eastern gateway Port of India. The goal for the next 7 years is : To execute the following projects selected to meet the traffic demands and to provide the supporting infrastructure. Projects : • • • • • Marine Liquid Terminal Coal Terminal Iron Ore Terminal Container Terminal Multi purpose General Cargo Berth

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Supporting Infrastructure • Dredging the areas of marine liquid, coal, iron ore and container berths in phases synchronising with the construction schedules of the berths. • • Establish Road and rail connectivity for evacuation of cargo. Develop other common infra-structure to improve port’s attractiveness.

Strategy: • • • • Develop Cargo terminals through private sector participation. Undertake support infra-structure works through EPL financing. Acquire additional lands to support the long term developments. Co-ordinate with the concerned State and Central Government Departments to improve connectivity. • • • Maximise utilisation of the existing assets and increase revenue earnings. Obtain Government funds for capital dredging. Develop core manpower.

DEVELOPMENT PLANS (A) BOT PROJECTS – CARGO TERMINALS :

Marine Liquid Terminal (3 MTPA): The Licence Agreement was signed in November 2004 with Ennore Tank Terminal Private Limited (a SPV of IMC Limited and L & T Limited) for a period of 30 years on Built Operate and Transfer basis (BOT) with Revenue Share of 21.678% to EPL. The period of project construction is 24 months and the construction work is in progress. The approved project cost is about Rs.200 crores. As per schedule submitted by the Licensee, the project would be completed by the end of December 2008.

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Coal Terminal (8 MTPA for Non TNEB users): The Licence Agreement was signed with M/s. Chettinad International Coal Terminal Private Limited on 14th September 2006 for the development of Coal Terminal with Revenue Share of 52.524% to EPL. The approved project cost is Rs.400 crores. The project has a construction period of 30 months and expected to be commissioned by August 2010. Iron Ore Terminal (12 MTPA): The Licence Agreement was signed with M/s. SICAL Iron Ore Terminals Limited on 23rd September 2006 for the development of Iron Ore Terminal with Revenue Share of 51.6% to EPL. The approved project cost is Rs.480 crores. The project has a construction period of 30 months and expected to be commissioned by August 2010. Container Terminal (1.5 MTEUs / 18 MTPA): Public Private Partnership Appraisal Committee (PPPAC) accorded in-principle approval on 23rd October 2007 for the development of Container Terminal. The project cost is estimated about Rs.1400 crores to build Terminal facilities to handle about 1.5 MTEU (18 MTPA). The Environmental Clearance was received for 1000 m quay length. The Request for Qualification (RFQ) document has been prepared through services of M/s SBI Capital Markets Limited, the Project Management Consultant in line with the “Guidelines for pre-qualification of bidders for PPP Projects”. After approval, the NIT was published on 7th March 2008 for selection of bidders. 62 Applicants purchased the RFQ document. Out of them, 22 Applicants have submitted their Applications for shortlisting and the same were opened at 14.00 hours on 20th May 2008. Six applicants were short-listed with the approval of the Board of Directors of EPL on 27.06.08. The RFP document and draft Pre-Bid Meeting was held on 27.07.08. Meanwhile, relevant documents of the short-listed bidders have been submitted to Ministry on 19.07.08 for obtaining Security Clearance. The term-sheet alongwith RFP and draft Concession 12

Agreement has been forwarded to Ministry for obtaining approval of PPPAC. The Concession Agreement is expected to be signed by March 2009 and the project is likely to be commissioned during early 2012 -13. (B) OWN PROJECT - Cargo Terminal Multi-purpose General Cargo Berth: EPL got the approval of Planning Commission to develop a multi-purpose general cargo berth as Port’s own project at an estimated cost of Rs. 110 crores. The berth will be utilised for handling of cars (about 200000 numbers), project cargoes and other general cargoes and to meet the berthing requirements of vessels of Defence and Government Agencies. National Maritime Academy has been assigned with the task of preparing a

Techno-economic Feasibility Report on the project. (C) CORE PROJECTS : Capital Dredging-Phase-I: The project involves dredging of 4 million cubic meters to provide -15 meters depth at the Marine liquid, Coal and Iron ore berths and approaches and to raise the land for coal and iron ore stackyards by using the dredge material. Letter of Acceptance (LoA) for the contract was issued to M/s Hyundai Engineering and Construction Co. Ltd., Korea on 30th August 2007 at an estimated cost of Rs.90.6772 crores. The Dredging contractor

commenced the work in October, 2007 and expected to complete the work by November, 2008. The above project was inaugurated by Thiru T.R.Baalu, Hon’ble Union Minister for Shipping, Road Transport & Highways. Capital Dredging-Phase-II: Capital dredging Phase-II involves dredging of 20 million cubic meters for providing -20 meters depth at the approach channel, -18.5 meters at the turning circle and -18 meters at the iron ore berth and -16 meters at the container berth. National Maritime Academy has been assigned the task of preparing a Detailed Project Report. The project is expected to commence during the second quarter of 2009. 13

Road Connectivity: EPL is also drawing up and crystallizing plans for improving the Road connectivity to the Port. The SPV promoted by Chennai Port Trust and NHAI has already taken up four

laning of TPP road for which the company has committed to contribute Rs.17.50 crores (the differential cost of two lane and four lane configuration), out of which Rs.8.75 crores has already been paid. Physical progress of about 10.95 % achieved upto January 2008. The present contract is likely to be terminated and re-tendering process will be taken up by SPV. A New Northern Port Access Road from Port’s North Gate to Tachur on NH5 was proposed by the Company and it was taken up by NHAI under the ‘Port Connectivity to the Golden Quadrilateral or North-South & East-West Corridors’ program. NHAI has awarded the consultancy services assignment for carrying out the Feasibility Study for this project to Wilbur Smith Associates Private Limited. The Consultant has submitted the Report to NHAI. The estimated cost of the project is Rs.271 crores. Feasibility Report was sent to Ministry by NHAI for approval. Meanwhile, the Secretary, Shipping has proposed to convene a meeting on 26th June 2008 with NHAI & EPL to discuss about the financing for the project. Rail Connectivity: EPL has obtained in-principle approval from Southern Railways and Government of India for Rail Connectivity between Ennore Port and Main Lines of Indian Railways (Ennore Port to Attipattu Railway station) for servicing Coal, Iron Ore and Container Terminal. The Detailed Project Report (DPR) was submitted to Southern Railways and approval is awaited. Meanwhile, EPL have appointed a Project Management Consultant (PMC), M/s. United Rail Road Consultant Private Limited, Secunderabad on 29th November 2007 to supervise rail connectivity of Coal and Iron Ore Stackyards. The selection of Works Contractor is in progress.

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Financial Performance & Cash Flow for the past three years Actuals Actuals Actuals Particulars 2005-06 2006-07 2007-08 (Rupees in Crores) Cargo Throughput (MTPA) 9.17 10.71 11.56 Total Income 97.81 110.50 143.72 Profit after Tax 9.07 30.64 34.88 Opening Cash Balance 34.81 56.78 77.71 Net cash flow during the year 21.97 20.93 -12.19 Closing cash balance 56.78 77.71 65.52 Projected Financial Performance & Cash Flow for the next four years Particulars 2008-09 2009-10 2010-11 2011-12 ( Rs in crores ) Cargo Throughput (MTPA) 10.55 16.73 31.38 47.00 Total Income 123.50 173.38 281.03 420.21 Profit after Tax 26.47 51.40 130.59 246.93 Add : Depreciation 13.50 18.98 23.96 26.36 Retained earnings 39.97 70.38 154.55 273.29 Opening Cash Balance 65.52 31.03 -283.75 -677.98 Total funds available 105.49 101.41 -129.20 -404.69 Less : Repayment of loan 14.46 15.16 48.78 64.11 Capex 60.00 370.00 500.00 230.00 Net surplus 31.03 -283.75 -677.98 -698.80 CAPEX PROGRAMMES : To achieve the desired goals set for the next three years EPL has envisaged to incur the following Capital Expenditure. S. No 1 2 3 4 5 6 CAPEX Capital Dredging Cargo Terminal Road Connectivity Rail Connectivity Land Utilities & Services Total Estimated cost 500 90 100 300 90 20 1100 PHASE OF 20010-11 2011-2012 300 100 40 50 25 100 100 10 500 5 230

2009-10 100 50 25 100 90 5 370

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