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Cost benefit analysis for improving the ships' entrance to the industrial quays of Grenland Port

Authors: Viggo Jean-Hansen
Report nr: 1185/2001
Language: Norwegian
Attachments Hele notatet
Sammendrag

This cost benefit analysis is considering a project of deepening and steightening the entrance to two industrial quays (The Main Quai and the Western Quai) in the Frierfjord-basin in Grenland Port in the southern part of Norway. The considered alternative of this project has a annual capitalised cost of 7,6 mill NOK. This includes deepening costs for the two quais involved. The costs include the recommended 20 per cent additions for taking into consideration that the project will be financed by use of public money. The recommended interest rate in such calculations is 8 per cent. There are two bigger factories in the Hydro Group which will benefit mostly by doing the project. The effects they claim to have from the project are in such order of magnitude that they alone will make tthe project profitable to do. In addition to this there will be most probably fewer accidents with smaller ships going frequently through the entrance mostly by making it wider. There are tugboats which are assisting bigger ships through the entrance. Most probably there will be fewer assists if the projec is done. This will again reduce the shipping costs of passing through the entrance. The cost/benefit ratio is calculated to be 2.93 (for the most recommended alternative) which tells us that this project is profitable by good margin.

      

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