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Detailed Risk Listing

Risk
Category

Risk
Event

Risk Description

Strategic

Investment
Risk

The project may not generate revenue as anticipated

resulting in negative Net Present Value (NPV) / delayed
payback/ suboptimal growth rate

1. Gaps in validation of the traffic volume assumptions on a

periodic basis and revising the revenue projection (revenue
drivers)

Rating

The Organization needs to develop a structured report to monitor

all the assumptions
Risk remains.

2. Inadequacies in assessment of competition activities (XYZ,

other ports)

We have learnt that XYZ has initiated the export of Bauxite from
the Port.
It was also learnt that the competitor has plans to go ahead with
container exports and it form part of its master plan
From the physical review, we have observed that the reclamation
activity near the port is being carried out at a rapid pace. The port
may become a major challenge going forward.
Risk is scaled upwards

3. Change in economic relations with other countries (dry bulk,

duties, bans etc)

Certain commodities driving the food inflation are being banned

for exports. The risk is subject to target segment of commodity
and any applicable restriction.
To be evaluated with the Marketing Team

4. Reliance on the existing road infrastructure connecting rail and

other parts of hinterland

The Project continues to depend on the existing level of

infrastructure.

The risk remains

ABC Limited

Detailed Risk Listing

Risk
Category

Risk
Event

Risk Description

Strategic

Investment
Risk

The project may not generate revenue as anticipated

resulting in negative Net Present Value (NPV) / delayed
payback/ suboptimal growth rate

Rating

5. Sandbar at the channel entry may pose challenges after

dredging

The mitigation is subject to final dredge design at present.

Risk remains

6. High cost of initial capital (2 monsoons) and recurring

maintenance dredging (pre-dredged survey, dredging, disposal
through barges, post dredge survey)

Dredging activities carried out prior to <Date>(pre-monsoon) may

result into additional cost in absence of adequate protection. The
dredge design is under process.
Risk remains.

7. Selection of incompetent contractor (expertise, scalability and

proven experience)

This may need to be scaled down for Port as the contractors for
critical project activities have been evaluated and brought onboard.
However, risk remains in relation to fabrication of platform for ship
lift, road construction, and other ancillary contracts
Risk scaled upwards

8. Unacquired land within the project area (14 acres of land

pending to be acquired)

We have learnt that the matter is pending for final decision at the
Collector's office.
Risk remains

9. Inability to make changes in the Master Layout / Plan of the

project plan without the approval of the regulator

We have learnt that there are no major changes anticipated to the

Project except for Bunkering Facility, Change in technology for the
ship lift.
The approval requirements need to be evaluated

ABC Limited

Detailed Risk Listing

Risk
Category

Risk
Event

Risk Description

Strategic

Investment
Risk

The project may not generate revenue as anticipated resulting

in negative Net Present Value (NPV) / delayed payback/
suboptimal growth rate

Rating

ABC Port Specific

1. Change in cost ratio between road transport and coastal
transport to JNPT

The crude is trading at peak and on account of external situations

(Middle East, Japan) the prices are expected to remain at high
level. The fall out of the inflation, the domestic prices of fuel are
also likely remain at high levels. This may work favourably for
transhipment cargo. However, the benefit is subject to situation at
the time of port heading towards operational stage
Risk scaled downwards

2. Significant dependency on single commodity (bauxite) with

limited reserves and handful of miners coupled with regulatory
decisions which may impact their mining licenses

We have learnt that XYZ has initiated the export of Bauxite from
the Port. This poses a potential threat to the Port.
Risk scaled upwards

3. Dependency of exports by chemical companies in the

hinterland which are operating at low capacity utilization levels
and also subject to regulatory action by CPCB

The CPCB regulations and actions are becoming more stringent.

The risk is also subject to segment of cargo being evaluated by
the Port.
Risk remains

4. Commercial terms of the concession agreement are on the

basis of fixed rate pricing

To be evaluated at HO for developments

5. Proposed move by government to bring non-major ports under

the Tariff Authority for Major Ports (TAMP). This may restrict
independence in pricing and may lead to conflict between the
Central and State Government over the concessions granted

To be evaluated at HO for developments

ABC Limited