Financial modeling for ports investment decision

Given this is a maritime port company. It has a decision to either (1) convert/change one of its existing berth/wharf to handle a new kind of cargo B (i.e., the company will have to give up handling the existing cargo A) or (2) invest in building a completely new berth/wharf to handle cargo B. Additionally, the manpower whom used to handle cargo A can be deployed to handle new cargo B. 

Qns) In building the financial models to aid in the comparison btw option (1) vs (2) using NPV and IRR; should these be based upon the incremental cashflows for option (1) (i.e., incremental cashflows btw handling cargo B vs A)?

What about for option 2? Also, should manpower cost be allocated here given that the manpower cost already exist currently regardless of option 1 and 2

 
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