Chennai Port Trust has termed the INR 1,000 crore single buoy mooring project of Chennai Petroleum Corporation Ltd as a breach of agreement.

CPCL which imports about 10 million tonnes of crude oil for its refinery at Manali north of Chennai is one of the key customers of ChPT fetching the port revenues of about INR 13 crore annually. In 2003, CPCL signed an agreement with the Port Trust under which it agreed to stay with the port for the next 30 years.

Captain Subhash Kumar deputy chairman of ChPT told Business Line that after the agreement, the port trust reduced wharfage to INR 10 a tonne from INR 35 earlier. He said that “In other ports, wharfage is around INR 65 a tonne.”

The port trust invested further changed a loading arm, fire fighting equipment and even contributed funds to a portion of the pipeline linking the port to CPCL’s Manali refinery.

When contacted over ChPT’s concerns about breach of agreement, Mr KK Acharya MD of CPCL told Business Line that CPCL had no alternative but to go in for single buoy mooring. The pipeline connecting ChPT to the refinery has outlived its life adding that unless an alternative mode of transporting crude from ships to the refinery was arranged for, the refinery was in danger of being shut down.”

(Sourced from Business Line)