APM Terminals, the Dutch concessionaire currently building a container terminal in the Caribbean port of Moín, announced Friday that the $1 billion project will not begin operating as planned on Jan. 18, 2018, due to unexpected situations.
General Manager Kenneth Waugh in a news release said that APM has notified the National Concessions Council on that the company encountered unexpected, adverse situations “that force us to rethink the construction plan of the terminal.”
These problems relate to the surface compaction of the 40-hectare artificial island for the port, damage in the breakwater, and problems with the angles of 20 piles.
Waugh said that despite these issues with the project’s timetable, the company’s priority is to deliver a terminal that meets the highest standards of efficiency and quality capable of operating for 60 years, as established in the contract. Company engineers and other experts are evaluating possible solutions, he said.
APM Terminals said it will announce a new delivery date of the project in 30 days, and that the company will pay the fines for the delay. According to the contract, the company will have to pay $2,000 for each day of delay in construction and $2,000 more for each day that the terminal is not in operation.
The company stressed that despite the problems, there are aspects of construction on the 40-hectare island that are moving forward as expected, and that construction work is 73 percent complete.
Aerial view of the Moín terminal from December:
The APM Terminals announcement comes just days after the government faced widespread criticism over an 80-meter (262-foot) error on a project to build a road connecting the Moín terminal with Route 32, the main road between the province of Limón and the Central Valley.
Public Works and Transport Minister Carlos Villalta appeared before the Legislative Assembly Committee on Public Expenditure Control on March 23 and said that the Ministry was aware that the project’s plans were wrong.
He said that when the public tender for the construction of the 2-kilometer (6,725 ft) road was published, the Transport Ministry did not have the environmental permits for the area where the road should connect with the Moín terminal; the environmental study had been performed on the wrong stretch of land.
While ministry officials were fully aware of the 80-meter difference, they decided to move forward “as it was the only way the cargo terminal could launch operations in January,” he said.
Legislators from five parties asked Villalta on Tuesday to step down his post. However, the Executive Branch backed the minister’s actions.
Presidency Minister Sergio Alfaro at a press conference later that day said that delaying the project represented additional costs: the fines that the government would be forced to pay the contractor for not complying with its part of the deal, which was building the road to the terminal.
“All decisions were taken to safeguard the country and avoid a cost that would be equal to the total value of the terminal,” Alfaro said.
He referred to the fact that if the government fails to finish the road before the terminal is ready, exporters and importers will lose a $20 rebate agreed on the transfer of each container on the terminal.
Alfaro estimated that losing that discount over the 30-year-period of the concession would represent roughly $1 billion.
Official data from the Foreign Trade Ministry state that 80 percent of Costa Rica’s exports pass through Limón.
Minister: “Road will be ready on time”
The contract for the 2.05-kilometer road was granted in a public bid to Consorcio del Atlántico, a corporation formed by local firm Constructora Meco S.A. and Spanish Puentes y Calzadas Infraestructuras.
The $72 million contract was awarded on June 30, despite the fact that MOPT officials were aware that the coordinates for the road were 80 meters off from the actual connection with the port.
The contractor subsequently charged $14 million to redesign the road and for additional works required to connect Route 32 to the terminal. The final cost of the road is expected to total $86 million.
Villalta, however, told lawmakers that the extra costs will consist of only $5.6 million, as officials had already allocated some $8.4 million for the extra stretch of road.
On Friday, the minister said in a news release that despite APM Terminals announcement, the government is maintaining its the deadline for the road’s completion.
“We will continue making all necessary efforts to build the interconnection road with the terminal in compliance with the contractual deadlines,” Villalta said.