The Hindu Business Line : L&T looking at integrated port-shipyard facility

Thrust area
The company is likely to take a decision by May-end on the location of the facility
The proposed shipyard is being billed as India's largest

New Delhi May 22 Engineering and construction major Larsen & Toubro plans to broaden the scope of its proposed Rs 2,000-crore mega greenfield shipyard in favour of an integrated port-cum-shipyard facility.

The company, which has been actively looking at three locations for setting up the facility, now plans to go in for an integrated facility, instead of only a shipyard, in light of cost implications of constructing a breakwater facility.

"We are now looking at a shipyard-plus-port facility... We need to invest quite a bit in a breakwater facility and it makes sense that the cost be shared by a port and a shipyard," L&T's President-Construction and Board Member, Mr K. V. Rangaswami, told Business Line.

Majority Equity

Breakwaters are structures constructed on coasts as part of coastal defence or to protect an anchorage from the effects of weather and longshore drift.

Mr Rangaswami said the company is likely to take a decision by May-end on the location of the facility.

The company has been looking at three separate locations — near Chennai in Tamil Nadu, Kakinada in Andhra Pradesh and Mundra in Gujarat — for up to 1,200 acres of land to set up the facility. L&T, which plans to retain majority equity in the venture, is open to having a "small participation" from other players, he said.

The proposed shipyard is being billed as India's largest and the only one that would be equipped to build big-sized carriers such as very large crude carriers with capacities of up to 3-3.5 lakh dead weight tonnage (dwt). Currently, of the 20-odd shipyards in the country, the Cochin Shipyard's facility in Kochi is among the largest and can build vessels of up to 1.1 lakh dwt. L&T has forayed into shipbuilding as a major thrust area for future growth, with a new shipyard at Hazira marking the beginning of the strategic initiative.

The company laid the keel for the first ship within 17 weeks of commencing operations at its Hazira shipbuilding yard in January this year. Detailed expansion plans for the Hazira Shipyard involve expanding capacity to construct eight vessels up to 20,000 dwt per annum.

It had marked its entry into this field in April 2006 by securing an order from the Netherlands-based Rolldock (earlier Zadeko Ship Management) for four heavy lift semi-submersible cargo ships.

The Government has announced plans to set up two international standard shipyards in the country, one each on the East and the West coast.