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Essar Ports wins bid for development of 3 iron ore berths at Vizag - 2013-06-07


Essar Ports has won the bid for the development of three iron ore berths at Visakhapatnam Port for 30 years. The total project cost as estimated by Visakhapatnam Port is Rs 845 crore.

Through its wholly-owned subsidiary Vadinar Oil Terminal, Essar Ports Ltd (EPL) emerged as the highest bidder by quoting 31.01 per cent revenue share for the mechanisation and operation of three iron ore berths, two outer harbour berths and one inner harbour berth on a build-operate-transfer (BOT) basis. These three berths will have a combined capacity of 23 million tonnes per annum (MMTPA). The company said the deal would be a big boost to third-party cargo handling and the revenue of Essar Ports as it would handle 17 MMTPA of third-party cargo and 6 MMTPA of Essar Steel cargo.

In a statement, EPL said the potential for iron ore export and coastal movement through the East coast would be facilitated with this deal. On commissioning, EPL’s total capacity for iron ore export on the East Coast will become 39 MMTPA with four highly mechanised iron ore berths. The company has three in the Visakhapatnam Port and one in the Paradip Port.

Visakhapatnam Port handled 12.3 million tonnes of iron ore during FY13 in spite of the slump in iron ore export in India. The bulk of the volume would be captured by these three berths after mechanisation as the outer harbour berths would be capable of berthing super Capesize vessels and the inner harbour berth would be capable of berthing Panamax vessels.

Rajiv Agarwal, Managing Director, Essar Ports, said the project would significantly increase third-party cargo handling by contributing 17 MMTPA of cargo. Essar Ports is currently developing one terminal at Paradip, which will be a coal berth of 14 MMTPA capacity. The company is also setting up a dry bulk terminal at Salaya with a capacity of 20 MMTPA.

Additionally, the company plans to expand its Hazira terminal capacity by 20 MMTPA, taking its capacity to 50 MMTPA. With this new project at the Visakhapatnam Port, EPL’s capacity under construction will increase by 23 MMTPA, taking the total units under construction capacity to 77 MMTPA.

Source: The Hindu Business Line