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Essar Ports strategy to ramp up 3rd party cargo - 2012-06-04

Essar Ports Ltd has put together a strategy to increase the share of its third-party cargo in the next two years so as to enlarge its cargo basket and get better price realisation. The port handled 43.23 million tonnes of cargo last fiscal, with almost 98 per cent coming from its group companies. The company now plans to increase the share of third-party cargo from two per cent to 25 per cent by 2014-15. This strategy is woven into its on-going expansion from the current 88 million tonnes a year (mtpa) to 158 mtpa by 2013-14. It is setting up a 16 mtpa iron ore berth and 14 mtpa coal terminal at Paradip, 20 mtpa dry bulk terminal at Salaya and adding 20 mtpa capacity to its Hazira terminal.

The focus on third-party cargo has shown results in its 2011-12 performance. The average realisation increased from Rs 187 for a tonne in 2010-11 to Rs 233 last fiscal based on higher tariff for new cargo segments. Third-party coal and project cargoes contributed to four per cent of its revenues from Hazira terminal last fiscal.

“We are further ramping up third party traffic at Hazira. We have received one time en block approval from GMB (Gujarat Maritime Board) to handle one million tonne third party coal at Hazira during monsoon of 2012-13. Also, applications are being made for handling third party clinkers of one to two million tonnes this year,” Mr Rajiv Agarwal, Chief Executive Officer and Managing Director of Essar Ports, said.

The company is also investing in crude tankers for traders and PSU oil companies at Vadinar. Additionally, its deep-draft coal berth at Salaya is expected to generate third party coal and bauxite cargoes of 8 mtpa, while the new Paradip coal berth could generate 12-14 mtpa by 2014-15. “We have plans to handle one million tonne of third party cargo at Paradip iron ore and bulk cargo terminal this year,” Mr Agarwal said.

Source : Hindu Business Line