Home » Maritime, Ports/Terminals » Sudan returns partial fee to ICTSI for uncompleted terminal deal

Sudan has partially repaid International Container Terminal Services, Inc for failing to turn over on schedule Port of Sudan’s South Port Container Terminal. Image from http://sudanports.gov.sd

The Sudanese government has repaid part of the upfront fee it received from International Container Terminal Services, Inc. (ICTSI) after failing to turn over on schedule the South Port Container Terminal (SPCT) at the Port of Sudan to the port operator. ICTSI won the bidding for the concession contract of the container terminal last January.

In a disclosure to the Philippine bourse, ICTSI said the Sudanese Ministry of Finance & Economic Planning sent a letter to the port operator confirming the remittance of EUR195.2 million (P11.36 billion) in partial repayment of the EUR410 million upfront fee made by ICTSI, in accordance with the refund bond, adding that the balance would be repaid as soon as possible.

The remittance to ICTSI was due to the ongoing political instability in the Northeast African country, and the failure of the Sudanese government to turn over SPCT to the port operator by the April 7, 2019 deadline.

ICTSI said it is in continuous discussion with the Sudanese government about the repayment schedule for the balance on the upfront fee. Despite this development, ICTSI said it continues to reserve its rights under the concession agreement.

Last January, ICTSI, through its wholly owned subsidiary ICTSI Middle East DMCC, signed a 20-year concession agreement with Sea Ports Corporation of Sudan (SPC) to operate, manage, and develop SPCT.

With the concession, ICTSI was supposed to assume operation and development of SPC’s existing container terminal infrastructure and terminal handling equipment.

Meanwhile SPC—the independent state corporation that governs, constructs, and maintains Sudan’s ports, harbors, and lighthouses—will become the landlord and supervisory authority for the terminal.

The terminal, which has a capacity in excess of 1 million twenty-foot equivalent units (TEUs), had a throughput of 470,000 TEUs in 2017. The SPCT has a 180-hectare land area, as well as a 1,200-meter quay wall with a designed water depth of up to 16 meters that can receive the largest container vessels. It features state-of-the-art container terminal assets, eight ship-to-shore gantry cranes, and an extensive range of yard handling equipment, including more than 20 rubber-tired gantry cranes.

Last March, former Sudanese President Omar al-Bashir ordered a review of the concession agreement after hundreds of port workers went on strike in February to protest the turnover of the terminal to ICTSI. In April, Bashir was arrested and forced down from power in a military coup.

In May, Sudan’s Transitional Military Council issued a presidential decree “to suspend the contract of the Filipino company working at Sudan’s southern port until legal measures are completed to cancel the contract.”

In response, ICTSI in a statement said it had “validly procured” the agreement but noted that if the Sudanese government decided to cancel the contract, it would fully cooperate.

However, the company also said it would execute the contract if the current government decided to accept the terms agreed upon with the previous government.

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