REHABILITATION AND DEVELOPMENT PROJECT PORT OF RIJEKA

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REHABILITATION AND DEVELOPMENT PROJECT PORT OF
RIJEKA

• Presentation by RMG and Port of Rotterdam
• Rijeka, March 21, 2002

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Content of the project

• Features Port of Rijeka
• Economic assessment and cargo forecast
• Tourist industry and passenger handling
• Port infrastructure, superstructure and
  operations
• Master planning / investment programme
• Financial aspects
• Institutional and organisational adaptations
• Conclusions and Recommendations

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Features Port of Rijeka

• Combination of Tool Port and Landlord Port
• Priority Concession PRA and Luka Rijeka
• Privatisation started recently
• Port area enclosed by town
• Hinterland connections rail and road
• Competitive ports Koper and Trieste
• Port tariffs influenced by light dues

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Concession agreements

• Luka Rijeka (Priority Concession)
• Approx. 20 service concessions
• Container terminal (Adriatic Gate)
• Soy bean storage (Ganz Port)
• Wood (LKM Impex Austria)
• Cars (Mosolf)

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Light dues comparison
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Boundary conditions

• Restructuring based on landlord port management
  model
• Foster private participation and competition in
  port operations
• Increase operational productivity and financial
  performance
• Upgrade port facilities and linkage inland
• Co-operation City and Port Authority

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Forecast assumptions

• Growth GDP Croatia 5
• Moderate growth hinterland
• Improvement competitive situation Port of Rijeka
  on medium term
• Result Increased market share Port of Rijeka

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Cargo forecast Medium scenario
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Passenger handling

• Tourism is one of primary branches for Croatia
  25 of GDP
• Passenger ferry services only by Jadrolinija
• Limited opportunities for attracting large cruise
  vessels in Rijeka
• Large potential smaller cruise vessels
• Potential for ferry traffic

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Masterplan

• Upgrading of Passenger Terminal and investments
  in tourist infrastructure
• Bakar transfer minor bulks to Bakar and
  development of multipurpose terminal
• Transfer wood from Delta to Zagreb Quay
• Improvements at general cargo terminal
• Wood and cars in Rasa basin

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Passenger terminal

• Passenger Terminal (2 phases)
• Phase 1 establish second ramp for ferries
• Phase 2 create parking area and completion of
  terminal
• Investment 6.5 mio USD
• Benefits more passengers and cars handled
• Establish Rijeka City Development Corporation to
  represent city interests

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Lay-out passenger terminal
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Artist impression
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Bakar terminal

• Enhance capacity of stacking and storage
  facilities and hinterland connections
• Investments
• 4 mio USD for minor bulk cargo
• 7 mio USD storage for coal and ore
• Benefits Improved efficiency for minor bulk
  cargo and capacity required for coal and ore

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Multipurpose terminal

• Investments wood handling at Zagreb Quay
• transfer of wood
• first berth of Zagreb Quay
• Investments 25 mio USD
• Benefits
• delta area available for city related activities,
  higher value of land
• efficiency improvements
• additional quay length

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Multipurpose terminal
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General cargo terminal

• Renovation and reconstruction of general cargo
  infra- and superstructure
• Creation of open / covered storage
• Infrastructure investments 10 mio USD
• Benefits
• more efficient handling light cargo
• increased capacity for heavy cargo

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Investment programmePlanning proposed masterplan
investments (mio USD)
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Other investments

• Marina development to equalise Barros area
• Construction of soy bean warehouse
• Mobile cranes and small equipment
• State of the art VTMS, together with VHF, to
  reduce risk of maritime accidents
• Redundancy programme Luka Rijeka similar to
  programme Croatian Railways

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Hinterland and Safety

• Infrastructure
• upgrade existing 2-lane main city road
• new highway from Rijeka to Split
• two new axes west and east of city centre
• VTMS
• VHF coverage in area under PRA
• radar and CCTV system under PRA

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Communication Issues

• Internal organisation
• Management Information System
• port statistics
• improve procedures and organisation
• External relations
• Port Community System
• EDI and ICT

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Manpower planning

• Manpower planning Luka Rijeka based on 2000
  throughput
• Headquarters personnel from 547 to 67
• Permanent staff from 177 to 131
• Operative / pool workers from 682 to 298
• Daughter companies from 200 to 157
• Improvement efficiency cargo handling
• Redundancy programme

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Financial aspects RPA

• RPA confronted with heritage of past
• Fee for Priority Concession is low
• State Aid will be needed on medium term (50 of
  revenues)
• After 2010 financial performance will be positive
  in case new concessions will be concluded under
  commercial conditions

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Financial aspects Luka

• Financial performance Luka was marginal
• Financial position is healthy (60 shareholders
  equity)
• Announced initiatives cost savings
• Projected financial performance of all terminals
  negative, except for container and general cargo
  terminals
• Outcome sensitivity analysis breakeven with 10
  less cargo

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Institutional reforms

• Key future orientation Landlord port management
  model
• Ownership transformation
• privatisation profitable terminals
• corporatisation non-profitable terminals
• independent unit for labour pool
• Conditional are changes in
• Maritime Code (Maritime Domain)
• Priority Concession

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A final word

• RMG / Port of Rotterdam
• wish all parties involved
• A healthy business
• in an environmentally friendly
• Port - City relationship!