The Ukrainian Port Authority and the MV Cargo company have signed an agreement on construction of a Cargill grain terminal in the Yuzhny port and dredging of the port’s waters and an approach channel. The agreement was signed by the Ukrainian Port Authority’s head Andrii Amelin and MV Cargo’s Director Oleksandr Prymak, the press service of the Ukrainian Port Authority announced.

The signing ceremony was attended by Cargill’s CEO Martin Schuldt, the TIS limited liability company’s General Director Andrii Stavnytser, the Yuzhny port’s head Maksym Shyrokov, director of Cargill Europe’s grain division Andreas Rickmers, and Cargill International’s Vice President Roger Johnson.

According to a press release, MV Cargo is the developer of the project and it is responsible for construction of a specialized marine terminal for handling grain cargoes and their byproducts, as well as the berth No. 25 of the Yuzhny port. The first phase of the terminal will have a capacity of 5 million tons. The second phase will increase the capacity by 2-4 million tons.

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For its part, the Ukrainian Port Authority will ensure creation of navigable waters around the port’s berth No. 25 and an approach channel to the berth No. 25. The port’s waters and the approach channel will be dredged to a depth of 16 meters.

The approximate amount of investment in construction of the grain terminal will amount to USD 104 million. The Ukrainian Port Authority will spend about USD 50 million on dredging. The feasibility studies for the project for dredging the waters of the Yuzhny port have already been submitted to the relevant ministries for approval.

"A key component of the agreement for us is the provision that commits the Cargill company to provide the volume of grain cargoes necessary for full operation of the terminal. This is a striking example of the concept of assigning a specific berth at a port to a cargo owner, which creates convenient and clear conditions for public-private partnership," the Ukrainian Port Authority’s head Andrii Amelin said during the signing of the agreement.

"According to our estimates, budgets of all levels will receive more than UAH 300 million in tax payments per year as a result of implementation of the project. In addition, about 350 jobs will be created," said MV Cargo’s Director Prymak.

MV Cargo is required to complete construction of the grain terminal by 1 September 2018. The Ukrainian Port Authority is obliged to complete the dredging work by 1 February 2018.

Thus, the parties have complied with the terms of the agreement that was signed with Cargill in the Cabinet of Ministers on 24 February 2016 in the presence of Prime Minister Arseniy Yatsenyuk, United States Ambassador to Ukraine Geoffrey Pyatt, Minister of infrastructure Andrii Pyvovarskyi, Minister of Agriculture Oleksii Pavlenko, and Minister of Finance Natalie Jaresko. Cargill has committed to acquire 51% of the grain transshipment terminal that MV Cargo will construct in the Yuzhny port.

The AT Cargill limited liability company is the investor in the project for construction of a grain terminal at the Yuzhny port. The company is a 100% subsidiary of Cargill Inc., the largest privately held US food corporation. Cargill Inc. reported revenue of USD 120 billion for 2015. The company has 66 offices worldwide and a workforce of about 130,000 people.

The MV Cargo limited liability company was created specially for implementation of the project for construction of a grain terminal in the Yuzhny port. The company owns the berth No. 25 at the Yuzhny port and the land plot on which the terminal will be built. The project involves construction of modern export terminal in full compliance with the Cargill’s standards. The new terminal will have a technical handling capacity of 5 million tons of grain per year and a total storage capacity of 290,000 tons.