Grain operator miffed at port administration

  • 2006-07-05
  • From wire reports
RIGA - Ventspils Grain Terminal, a Latvian-Kazakh joint venture based in Latvia's primary port city, has sent a letter to President Vaira Vike-Freiberga and several ministers complaining that the port administration was obstructing business development.

According to the daily Diena, the Ventspils Free Port administration refused several times last year to allow the terminal to accept ships for loading, and at the end of May this year, the port raised its wharf rent 50-fold 's from 10,000 lats to 500,000 lats (711,400 euros) per year.

The letter could set the stage for an interesting conversation later this month when Kazakhstan President Nursultan Nazarbayev visits the port and grain terminal. The Kazakh president is reportedly interested in acquiring the government's stake in Ventspils' oil terminal, which is currently floundering due to a Russian crude oil embargo.
Ventspils port manger Imants Sarmulis said that the rental had been raised because VGT had failed to ensure the planned cargo turnover and, as a result, the port had not been able to recover the money invested in infrastructure.

"VGT promised to reload 1.5 million tons a year but has handled less than 200,000 tons since it became operative in November last year," said Sarmulis. He admitted that some ships were not allowed into the port last year, but this had been done because no rent agreement with VGT had yet been signed.
Total investments in the grain terminal, which officially opened in Ventspils at the end of August last year, added up to $30 million. The terminal was built for reloading and export of grain from Kazakhstan, Russia and other CIS countries and the Baltic states to the world market.

At the opening ceremony, Kazakh representatives promised that, initially, about a million tons of grain could be reloaded through Ventspils annually, and that later exports would increase gradually, bringing total capacity to 2.5 million tons a year. The terminal is able to serve Panamax ships with up to 70,000 tons cargo capacity.