Court confirms termination of Gammon Infrastructure's Goa Port project

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Court confirms termination of Gammon Infrastructure's Goa Port project

Gammon Infrastructure Projects has received bad news regarding Mormugao Port Trust's decision to terminate its Rs2040 million (US$33.6 million) project in India.

Gammon approached the district court after the port last month "unilaterally" terminated the concession agreement signed at the end of 2012 to build a coal handling facility on berth number 11 to handle at least 2 million tonne of coal per year. Now the court has confirmed the decision. 

The notice follows the refusal of Goa's state pollution control board to grant the mandatory environment clearance.

In September 2012 the state pollution control board stopped coal handling on the same berths citing rising coal dust pollution, inadequate precautions and complaints from citizens but the port still went ahead with the bidding process.

The concession agreement had been signed at the end of 2012 but the state pollution control board's order in January 2014 denied clearance to the project.

Subhrarabinda Birabar, head of ports at Gammon Infrastructure, stated:

The port was supposed to get the clearance from the pollution board. This was the condition precedent. We have invested more than Rs 7 crore (US$1.15 million) in the project. The port had given us an assurance about the clearance.

Earlier this month, Gammon also informed the stock exchange that two of its road projects were being terminated due to delays in clearances. Also in April 2014, the Greater Cochin Development Authority (GCDA) has announced that it would take over the BOT bridge at Mattancherry in Kochi (Kerala, India) from Gammon on April 27th.

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