Dublin Port Company is in advanced negotiations with the government of the Indonesian province of Aceh over a proposed joint venture to develop a major deep-water port on the northern tip of Sumatra , reports from Indonesia indicated yesterday. Colm Keena, Public Affairs Correspondent, reports.
"In principal, all matters have been agreed on and the agreement only remains to be formalised," said Saiful Achmed, the head of Dublin Port Company's putative partner in the project, the Sabang Zone Management Agency (BPKS).
The entire development could cost up to $900 million (€662 million) over 10 years, though much of this investment could come from parties that would be using or operating from the port. The contract between the two parties would run for 50 years.
Responding to the reports from Indonesia, a spokesman for the State company said it wished "to clarify that it has not signed a $900 million agreement to develop a port at Sabang Aceh in Sumatra, Indonesia".
However, he continued: "Dublin Port Company has, with the encouragement of the Taoiseach and appropriate Ministers, been exploring investment possibilities abroad for a number of years.
"In May of 2006, at the request of the Indonesian authorities and following a visit by the governor of Aceh to Dublin, a memorandum of understanding between the company and the Achenese authorities was signed.
"At that time the company committed to continuing negotiations with a view to agreeing a joint venture, the purpose of which will be to assist and advise the local authorities in Aceh to develop ports and related maritime business in the Sabang area."
The spokesman said that negotiations had progressed to the point where Dublin Port Company "shortly hopes to be putting proposals to our board and subsequently to the appropriate Ministers for their consideration and subject to their consent".
He added: "It is hoped that the port of Sabang could eventually become an international hub container transhipment port for southeast Asia. Such developments require extensive consideration and long-term planning."
Dublin Port Company does not at present have any investments abroad.
The negotiations with the authorities at Aceh are being led by the company's chief executive, Enda Connellan, and members of the senior management staff.
If the deal is agreed, ministerial consent will be required by the company before it can invest any funds.
Aceh is seeking to build Sabang as an international seaport. In an interview with the Jakarta Post in February, the then outgoing acting governor, Mustafa Abubakar, who visited Dublin in May last year, said: "During meetings with Republic of Ireland Government officials and businesspeople, we considered a co-operation to develop Sabang into a seaport on par with the Dublin Port."
Reports from Indonesia said an equal share joint venture company, Sabang Hub International Port, was expected to be up and running by July.
"Our plan it to build a quay 2,500m [ 8,200ft] long, and the harbour will be 22m [ 72ft] deep," Mr Saiful said. "The contract will last for 50 years."
