Bhubaneswar: Orissa plans to develop a port at the mouth of Subarnarekha river at a cost of 20 billion rupees, a government official said on Monday.

The government signed a preliminary agreement with Creative Port Development Pvt. Ltd., based in the southern city of Chennai, for the deep-water, all-weather project, transport secretary Priyabrat Patnaik said.

The port could offer an outlet to landlocked states such as Jharkhand, Chhattisgarh and Bihar, he added. The plant, with an initial capacity of 10 million tonnes a year, would be commissioned by 2010, Creative Port's joint managing director Ramani Ramaswamy said.

The developer planned to invest Rs 2,000 crore in the first phase of the project. This is the third port project taken up in the private sector on the Orissa coast as the government had signed MoUs with private companies for a greenfield port at Dhamra and development of the Gopalpur port.

Official sources said the Kirtania Port project was being taken up on a 50 year build, own, operate, share and transfer (boost) basis.

The development would also include a dedicated rail cum road connection from the port to the nh-5 and rail network at Jaleswar.  The first phase of the project, with a capacity to handle 10 million tonnes of cargo per annum, is scheduled to be completed by 2010. The port would raise its capacity to 50 MTPA by the 10th year, the sources said.

The MoU was signed by Ramani Ramaswamy, Joint Managing Director of the Chennai-based company and Priyabrata Patnaik, Principal Secretary in the Commerce and Transport Department in the presence of Chief Minsiter Naveen Patnaik.