Revenues will continue to grow in 2011, despite the soaring cost of oil, Essar Energy said as the firm reported a 28 per cent rise in pre-tax profits for the year 2010 — its first full-year results since last year's IPO in London.

Pre-tax profits of $365.5 million were some 25 per cent ahead of consensus as refining sales volumes grew, and gross refining margins rose to $6.6 on a barrel from $4.2 the year before.

“2010 was a transformational year,” said Mr Prashant Ruia, vice-chairman of Essar Energy, the refiner and power generation, which raised $1.8 billion in last year's listing, alongside an additional $550 million through a convertible bond issue in February. “We are well funded.”

Essar Energy, which signed an exclusivity agreement to buy Royal Dutch Shell's Stanlow refinery in the UK last month, expects the deal to be signed within 10 days (before a March-end deadline).

Shell's consultations with staff were progressing well, the chief executive, Mr Naresh Nayyar, told a conference call, adding that Essar expected to take control of the plant in the second half of the year. When asked if the firm had been hit by Iran's decision to pull out of the Asian Clearing Unit, Mr Nayyar said they expected no disruption to supplies of oil from the country — one of the firm's biggest suppliers — and that the agreement remained in place.

However, market sentiment in London was hit by news of new delays to approval for clearing forest for its Mahan, Chakla, Ashok Karkata coal blocks — which were to supply its Mahan 1 and Tori Power stations. The firm said that as a result, it would be sourcing coal from external sources for the commissioning of the Mahan 1 coal fired power project in September.

There was also news of delays in its refining and marketing business, as the firm pushed back the start-up of three plans — Salaya 1, Mahan and Vadinar P2 by a quarter respectively.

Salaya 1, a 1,200-MW plant, has been hit by delays during the monsoon season, and will start up in the third quarter, while the other two will begin operations in the final quarter of the year.

EBITDA at the firm's power division were up 37 per cent, but fell marginally to $515.5 million from 514.7 million in refining and marketing — which the firm attributed to higher operating costs, and lower foreign exchange gains. Losses at the exploration and production division fell to $1.1 million, from $8 million the year before.

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