The investment would be made in two phases so that the port can handle 110 million tonne per annum of cargo by September 2020
Essar Ports, a unit of Ruias-promoted Essar group, is looking at investing $70 million to expand its Hazira Port's capacity in Gujarat.
The investment would be made in two phases so that the port can handle 110 million tonnes per annum of cargo by September 2020.
Under the first phase, the capacity will be increased to 95 million tonnes per annum for which $20 million will be financed through internal accruals as well as debt. This phase includes jetty construction with a deadline of March 2019. In FY2018, Hazira Port handled 41 million tonnes.
As part of the second phase of the project, another $50 million will be invested. "Funding for this is yet to be arranged," said Rajiv Agarwal, Chief Executive Officer and Managing Director of Essar Ports. By September 2020, ship unloaders, conveyor belt system, etc. would be commissioned.
Presently, Essar Port's outstanding debt stands at $600 million (Rs 3,900 crore). As planned earlier, the company is yet to commence the process to refinance its debt.
In FY2018, the Ruia promoted company earned $190 million (Rs 1,300 crore) in revenues as against $145 million (Rs 1,000 crore) in FY2017.
Meanwhile, Minister of Shipping Nitin Gadkari will inaugurate the upgraded iron ore order handling complex at Essar Group's Visakhapatnam Port today.
With the project completion, the cargo loading capacity at the facility within the Visakhapatnam Port has been upgraded to 24 million tonnes per annum from the earlier 12.5 million tonnes per annum.
The modernisation plan included dredging for the all-weather deep draft facility, high capacity tipplers, high capacity reclaimers, conveyor systems (9.5 kms), etc. at a cost of Rs 830 crore.
Essar Ports had bagged the terminal in May 2015 on Design-Build-Finance-Operate-Transfer basis for a period of 30 years on 31% revenue sharing to Visakhapatnam Port Trust. The initial deadline for upgradation was June 2017, which was rescheduled repeatedly. "We had to carry out works only when there wasn't any vessel, which is why it took time to complete the project," said Agarwal.
The port caters to mines in the states of Odisha, Chhattisgarh and Jharkhand and approximately 80% of the cargo is shipped to the Indian coastal states and the rest is exported to China, Japan and Korea.
DEEP ANCHOR
- The investment would be made in two phases so that the port can handle 110 million tonne per annum of cargo by September 2020
- In first phase, capacity will go up to 95 million tonne per annum; $20 million will be financed through internal accruals, debt
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