A dredging project has been under implementation at the Yuzhny port for more than one year. What results have been achieved to date?

The Dredging work began just over a year ago, in February 2013. Since then, we have managed to increase the channel draft for ships from 14.5 meters to 17.5 meters.

However, according to plans, the draft of 18.5 meters was to be reached in April. What are the reasons for this delay?

The work is being performed according to a plan and schedule that take weather conditions into account. The good news is that on Monday (June 2, 2014), I signed a decree on introduction of the draft of 18 meters on June 10, and the draft will increase to 18.5 meters before the end of the month. Technically, these depths have been achieved as of today, but organization of navigational safety on the pilotage side is currently underway. By June 10, information about the new depths will be sent to the Electronic Cartography Center in Norway, which will notify all ship owners. The depth will also be added to pilot charts and the appropriate navigation equipment will be installed in the channel. We are performing this work jointly with the Delta Lotsman affiliate of the state-owned Association of Seaports of Ukraine (ASU) and the State Hydrography Service. Currently, the channel draft is 17.5 meters.

Who is the contractor for the dredging project? To what extent are you, as the customer, satisfied with the quality and speed of the work?

The German company Mobius is performing the dredging work. It has already completed about 70 percent of the total volume of the planned work, and I can say that the result satisfies us completely. The company is using high-technology equipment, and it meets all the necessary requirements.

It has been argued that the services of Mobius - as a foreign company - are too expensive and that the services of local operators would have been cheaper...

An open competition was held and everyone, including local companies, had the opportunity to participate in the competition to perform the dredging operation. As the customer, we were primarily interested in the the price/performance ratio of the services being provided and experience, as well as in the ability to implement such projects. Such a depth did not exist at Ukrainian ports before this project at the Yuzhny port. Accordingly, there was lack of experience and equipment. Mobius has been operating in Ukraine since 2004, and it has extensive experience and technologies, both internationally and in Ukraine. These components are very important for implementation of such a major project, which has resulted in the Yuzhny port becoming the deepest deep-water port in the Azov-Black Sea region. Nobody needs to be convinced of the fact that depth is the key to competitiveness in a modern port today. The experience of the development of major European ports such as Rotterdam and Hamburg is convincing evidence of this.

The channel draft at the Yuzhny port will increase to 18.5 meters before the end of June

Why did the ASU finance the project and not private investors?

It is practical international practice for a state, represented by a port authority, to use port charges to develop and equip the port’s waters and create the necessary infrastructure there while private investors invest significant funds in modern transshipment complexes. Ports of Europe and our closest competitors for transit cargoes in the Baltic States operate and develop under this scheme. If we are talking about the prospects of the Yuzhny port, then an analysis of the announced investment projects provides every reason to say that the project will significantly increase the total number of ships calling at the port, the revenue from which we will reinvest in development of the port’s waters and berths. Only this type of cooperation will allow us to increase cargo traffic, increase revenue from ship calls, increase transfers to the central and local budgets, and create new jobs. These are the goals that we want to achieve by implementing this project.

Besides development of the port’s waters, the topical issue of development of railway infrastructure is on the agenda: the Chernomorskaya station, a second railway branch line, and the Promyshlennaya and Beregovaya stations. Development of the railway infrastructure is important because of its limited capacity. Therefore, cargo traffic can be increased only through synchronous development of both the port and railway infrastructures. It is gratifying to note that the largest private investors have chosen the Yuzhny port as the priority port for construction of terminals.

The State Railway Administration (Ukrzaliznytsia) also considers the Yuzhny port as a priority and plans to extend a line in this direction. We now expect these statements to materialize into concrete projects for development of the rail infrastructure in the region.

New terminals will increase cargo traffic by 40 million tons - CFTS

How has the change of the draft affected the loading and unloading volumes of ships? How much do cargo owners really save (as a result of reduction of loading in the harbor)?

Both ship owners and shippers are already feeling the main effects of the dredging work that has been performed. Previously, ships moved away from berths with a draft of 14.2 meters to finish loading on the road (up to 18.5 meters). It will no longer be necessary to finish loading on the road from July. This will enable cargo owners and charterers to save time and money. It currently costs USD 50,000-60,000 to charter a Capesize vessel for only one day. Thanks to the increased loading volumes at berths, the total period for loading a vessel has reduced by 4-5 days. At the same time, we expect a significant increase in cargo traffic at the terminals belonging to the TIS group of companies, since the Yuzhny port has already reached the limit of its capacity, but Capesize vessels can finish loading at its berths after TIS’ berths.

When can the cherished 21 meters be expected?

We hope to achieve it this year. In accordance with the plan for development of the port, the port waters will be deep at all the new and existing terminals: grain, coal and ore, and liquid bulk terminals.