Alakol Port (export port)

Project Essence and Problem Addressed **The project establishes an industrial “dry export port” logistics hub on the Kazakhstan–China border** (Zhalanashkol station, 40 km from Alashankou). **Core value: solving fundamental bottlenecks:** • **Different railway gauges** (Kazakhstan: 1520 mm, China: 1435 mm). • **Lengthy and complicated process of obtaining an export railway plan**, as priority is given to large corporations, state-owned companies, and Russian/European transit trains. Export plans are collected once a week, submitted to Beijing, and approval takes another week. **This creates severe bottlenecks at Dostyk and Khorgos stations, where cargo may be delayed for months.** **Currently, land trade between China and Eurasia (Central Asia, Europe, Russia) flows through just two crossings:** • Dostyk: focused on industrial bulk cargo (ore, concentrates, petroleum products). Overloaded. • Khorgos: focused on containerized consumer goods. Overloaded. Alakol Port’s multimodal solution: **• Bypasses queues for wagon transshipment/bogie change.** **• Eliminates the need for an export railway plan (only customs clearance is required for trucks).** **• Prevents wagon downtime in case of border closures (cargo can be stored on-site).** **• Accelerates procedures by hosting a customs post at the port (border checkpoint remains only for migration control).** Market Potential and Rationale While 95% of China’s trade is seaborne, the remaining 5% is 100% of the strategic land corridor to Eurasia. This segment, already worth tens of billions of dollars, is growing rapidly. **Alakol Port is not just a warehouse — it is critical infrastructure that solves the corridor’s bottleneck and captures part of the rising bulk cargo flows:** • Explosive demand growth: China–Europe rail traffic rose from nearly zero in 2011 to 1.5M containers in 2023. • Kazakhstan’s exports to China: +35% in 2022 ($13B), with bulk cargo up 31% (6.7M tons). • Export structure: 83% iron ore, plus agriculture (flax, sunflower seeds), fertilizers, sulfur. • Geopolitics: Sanctions on Russia redirected flows via Kazakhstan. 85% of China–Europe land logistics now runs through Kazakhstan. • Local demand: 60–70% of cargo remains in Xinjiang, fueling major industrial plants (e.g., ~1M tons of coal annually). **Target cargoes:** **• Bulk: iron ore, copper ore/concentrate, coal.** **• Chemicals: sulfur, fertilizers, industrial chemicals.** **• Agriculture: grains, oils, bran, corn, soy.** **• Containers.** Financial Indicators (Deloitte) • Investment: $120.8M • NPV: $60.3M • IRR: 22.8% • Payback period: 7.37 years (model uses conservative assumptions) we  • Revenue (stabilized): ~$112M/year • EBITDA (stabilized): ~$73M/year (margin ~65%) • Business valuation by Year 5: $350–400M Government Support and Incentives **The project has priority investment status (“Kazakhstan Invest”).** **• Tax incentives: 0% CIT & land tax for 10 years, 0% property tax for 8 years.** **• Customs incentives: 0% import duties on equipment/raw materials (5 years).** **• Land allocation: ownership transfer at cost 9 months post-commissioning.** **• Legislative stability: guaranteed for 25 years.** Team and Stakeholders • Initiator: SG Solutions LLP. • Anchor tenants: Ongoing negotiations with Russia’s EuroChem (fertilizers) and Kazakhstan’s Advaita (copper, copper concentrate). • Advisors: Deloitte (financial analysis), industry experts. Ladies and gentlemen, this is more than an investment — it is ownership of a critical Silk Road gateway. You are not investing in a warehouse — you are building the new standard of industrial logistics for Eurasia. Let us open the new path forward, together. Project stage: business plan by Deloitte