Locally-owned PTLS Cooperation Co Ltd has taken over a lease on an 18,836.69sqm plot from public-listed Phnom Penh Autonomous Port (PPAP) after Hui Bang International Investment Group Co Ltd’s contract was terminated in early September due to failure to pay the monthly rent.
PPAP director-general Hei Bavy confirmed to The Post on November 15 that the plot in question encompasses – although not exclusively – the under-development TS11 multi-purpose container terminal located on the Tonle Sap River in northern Phnom Penh.
In a November 4 filing to the Cambodia Securities Exchange (CSX), PPAP reported that it informed the Phnom Penh-based Hui Bang on September 8 that the latter’s land transfer request was accepted, on grounds that its “financial crisis” had rendered it unable to pay rent.
“PPAP has leased the land mentioned above to PTLS Cooperation Co Ltd and Mrs Ly Channy for the period of 34 years from November 1, 2022 to February 14, 2059 to maintain PPAP’s revenue,” the filing said, without explaining Channy’s affiliation to PTLS, or the inconsistent timeframes.
Hui Bang’s 40-year lease contract for the nearly-2ha plot started on March 15, 2019. The company had already launched sales of units of a condominium planned for the plot, although The Post understands that the development has yet to break ground. No updates on the number of units sold, or the future of the project were immediately available.
The Ministry of Commerce’s business registry names two of Hui Bang’s officers as “Liu Ren” and “Chu Zhengsong”, with postal registered office addresses in Phnom Penh and Shucheng county of China’s Anhui province, respectively. Liu is listed as Chu’s senior.
Bavy said that PTLS has begun development work on the TS11 – also known as Kilometre 6 Terminal – in cooperation with PPAP. The new lessee will handle the accounting and finance as well as bear the investment costs, while the lessor deals with business operations, he said, adding that profits would be shared on a 49:51 basis, with the state-owned enterprise (SOE) taking the majority.
“TS11 is currently operating at partial capacity, and we won’t have an official launch until we step up capacity,” Bavy said, adding that the terminal would be able to handle “about 50,000 containers” per year at launch, which he noted is equal to PPAP’s overall capacity in 2010.
This is decidedly less that the “60,000 to 90,000” TEUs (twenty-foot equivalent units) cited by Minister of Public Works and Transport Sun Chanthol in late April.
A TEU is an inexact unit of cargo capacity used in the shipping industry roughly equivalent to a container with internal dimensions measuring about 20 feet long, eight feet wide and 8.5 feet tall, or a volume roughly 38.5 cubic metres.
PTLS boss Sao Sovorn confirmed to The Post on November 15 that with the required authorisation, his company has begun toiling away on the TS11, which he noted is already in service. The new terminal will only be open to freight traffic for the time being, he said, voicing hopes of making a dent in the rising demand.
PPAP reported revenues from business activities of more than $30 million for the first nine months of this year, marking a 21 per cent year-on-year jump, despite regional and global economic uncertainty stemming from prolonged Covid-related slowdowns and the Ukraine crisis, according to an unaudited financial report filed by the river-port operator to the CSX on October 12.
The SOE said the number of cargo vessels handled at its facilities in the January-September period soared by 57.28 per cent year-on-year to 2,743, as oil, gas and cargo throughput rose by 5.23 per cent topping three million tonnes and container throughput increased by 28.33 per cent to 329,043 TEUs.