• Contractor submits Rs. 4.23 b claim
• No final decision: SLPA

Negotiations are now underway between the Sri Lanka Ports Authority (SLPA) and China Harbour Engineering Company (CHEC) over a multi-billion-rupee compensation claim related to delays in the East Container Terminal (ECT) project, even as the long-delayed terminal moves closer to full operational readiness, according to SLPA Managing Director Ganaka Hemachandra.

Hemachandra confirmed to The Sunday Morning that the contractor had submitted a claim amounting to Rs. 4.227 billion but emphasised that no decision had been made in relation to paying it.

“There is a formal negotiation process ongoing. Both parties have appointed an independent body for the negotiation. We will have to wait for their decision,” he said, noting that the matter was also under scrutiny by oversight bodies. He added that the claim was now part of a wider investigation.

“This was also taken up during the Committee on Public Enterprises (COPE) investigations and investigations are now ongoing with the support of the Commission to Investigate Allegations of Bribery or Corruption (CIABOC),” he stated, acknowledging public concern over the financial and procedural implications of the dispute.

Hemachandra said that the project, originally scheduled for completion in January 2025, was now expected to be fully operational by January 2026, following a previously disclosed 1.5-year delay.

According to him, the project has since been fast-tracked, with key sections already functional. “The second berth of the ECT is now functioning,” he said.

“We expect to start the third berth by the end of December, so we are likely to occupy all three berths by the end of December or the first week of January.”

He explained that the ECT had now entered its commissioning phase, where advanced systems and equipment were being calibrated and integrated. This includes the terminal operating system, yard equipment control systems, gantry cranes, and semi-automated workstreams.

“We are commissioning the systems. The berthing facility and yard operations will be ready by January 2026 and we will be able to commence partial operations by then,” he added.

The SLPA Managing Director stated that the major cause of the delay was an unexpected geotechnical obstacle discovered during construction, where a silt layer beneath the seabed, identified only in 2023, had forced a redesign and slowed progress by more than a year.

Hemachandra noted that CHEC had partly based its compensation claim on the disruption caused by this discovery.

Responding to questions about the financial impact of settling the claim, Hemachandra acknowledged the magnitude of the amount. When asked whether paying Rs. 4.2 billion would be “a huge loss for the country,” he replied: “Yes.” 

However, he stressed that the decision had to be guided by proper evaluation through the formal negotiation mechanism and the ongoing investigative processes. “We have not decided on whether to pay for it yet,” he reiterated.