Comments
Essar Ports' coal terminal development project at Paradip Port - held up since last two years due to a pending State Forest Clearance - is now likely to move forward.
The State forest clearance has come through recently, said Government sources in the know.
Based on this, the Central Government's forest clearance - to be given by the Ministry of Environment and Forest - will now be processed.
In November 2009, Essar Ports signed the concession agreement to develop the 14 million-tonne-a-year capacity coal handling terminal in Paradip Port.
HIGHER COST
“Though the construction cost is hedged, the total project implementation cost for Essar Ports will be higher on account of higher interest during construction costs with interest rates touching 13 per cent,” Mr Rajiv Aggarwal, Managing Director, Essar Ports, told Business Line .
The construction cost for Essar Ports will not go up because of this delay as it has already entered into fixed price, rupee-denominated contracts, with Essar Projects, another Group company. But, the interest during construction (IDC) cost will have to be borne by Essar Ports.
The company - which is also implementing another project at Paradip port - mechanisation of dry bulk terminal - expects to complete the project by April.
A 20-million-tonne-a-year project at Western port of Salaya is also awaiting the State Government's forest clearance.
On whether the recent rupee depreciation has impacted the company's revenues, Mr Aggarwal replied in negative. He said that revenues for all their earnings are rupee denominated. The only exception to this yet to be operational Salaya, where the revenues will be dollar denominated.
Essar Ports - through operations at Vadinar and Hazira - gets most of its revenues from Group companies.
It aims to increase the share of revenues from third-party players over the next few years. Revenues from third-party players - currently at two-three per cent total revenue - is expected to touch 25 per cent by 2015.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.