• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

The Essar Oil Refinery Complex in Vadinar (file photo).

Amit Mitra

Mumbai, Sept 22 The Ruias-promoted Essar Ports Shipping & Logistics Ltd (EPSLL) is in talks with a few global container port operators for a tie-up, as part of its plans to foray into container berth operations in the Indian ports sector.

ESPLL expects to complete the tie-up within the next two months, in time to bid for the Chennai container terminal project. The Essar group will be holding majority stake in the joint venture, with the foreign partner expected to provide expertise in actual container operations.

Earlier, it was in talks with a Korean port operator for the Ennore project, but the plan did not materialise.

EPSLL will be involving its group companies, Vadinar Oil Terminal Ltd (VOTL), which provides logistic support to Essar’s 10.5-million-tonne refinery, and Essar Bulk Terminal Ltd in its plans to sharpen focus on the port sector, Mr V. Ashok, the company’s whole-time Director, told Business Line.

The company is also looking to take part in the bidding process for other projects such as a coal berth at Marmagoa port, iron ore berth at Visakhapatnam, Kandla project and multi-purpose berth at Paradip.

Mr K.K. Sinha, Chief Executive Officer of VOTL, said the company was simultaneously looking at buying out some minor ports, which were yet to start operations. He was not willing to name the ports on the company’s radar.

VOTL, which expects to notch up revenues of Rs 200 crore this fiscal, is expanding its support services facility at Vadinar, as the Essar refinery plans to expand its capacity to 34 million tonnes by 2010.

To provide support services such as handling of crude and finished products, storage and product transportation, VOTL is investing $700 million. The expansion project include setting up a second Single Point Mooring (SPM) that can handle VLCCs, three additional berths, eight crude storage tanks and about 70 product tanks.

EPSLL is also setting up a 30 million tonne port at Hazira to handle the captive cargoes of Essar’s steel plant – the port will also be used to export the finished products from the steel plant. “For this the proposed investment is Rs 730 crore and we have already wrapped up the financial tie-ups. It will be funded through a debt-equity ratio of 70:30 and the project is schedule for completion by June 2009,” according to Mr Ashok.

Further, the company is setting up a 20 million tonne coal berth at Salaya in Gujarat to handle the captive cargoes of Essar Power – the Rs 800 crore project is schedule for completion by the last quarter of 2010. “We expect to complete the financial closure for this project within the next three months,” Mr Ashok said.

In its core shipping business, EPSLL has lined up a capital expenditure programme of about $800 million to acquire 14 ships between 2008 and 2011.

At present, the company has a fleet of 25 vessels, including two Very Large Crude Carriers (VLCCs), five cape-size vessels, 11 mini bulk carriers and one product tanker that is due for scrapping.

More Stories on : Alliances & Joint Ventures | Shipping/Ports

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line