Dhamra port ownership in status quo: L&T

Port promoters still waiting for suitable buyer

Ruling out any immediate stake sale of Dhamra port where it holds 50 per cent equity, engineering & construction major L&T said, ownership of the non-major port is under ‘status quo’.

“No, it (port ownership) is right now under ‘status quo’. We and the Tatas are running it,” L&T chairman A M Naik said in reply to whether L&T is selling its stake in the port project.  Dhamra port off the coast of north Odisha is run by Dhamra Port Company Ltd (DPCL), a 50:50 joint venture between L&T and Tata Steel.

He said, “I won’t say Dhamra port is a non-core asset. Its a question of who can do better. Non-core means there are many port developers who can expand the port very fast compared to us.”

The L&T chairman also scotched speculation on the Adani Group buying out the entire stake in the Dhamra port.

“You should ask Adani Group on that (plans to buy out the Dhamra port). There has been no interaction with the Adani Group, not at least at my level,” he said, after meeting Odisha chief minister Naveen Patnaik.

Adani Group had reportedly evinced interest in buying out the whole stake in the Dhamra port for $1 billion (or Rs 5,500 crore).

Dhmara port which commenced commercial operations in May 2011 was hit by curbs on export of iron ore, its key growth driver. The port currently operates two berths with a combined capacity of 25 million tonne per annum (mtpa) and has handled a little over 15 million tonne since start of commercial operation in May 2011, inclusive of export and import cargo, till March 5.

The achievement is barely 60 per cent of its available capacity.  

In the April-January period of this fiscal, iron ore exports from India declined 62.3 per cent to 15 million tonne against 39 million tonne in the year-ago period.

Moreover, exports from Odisha had suffered as the state government sought to restrain it to conserve the raw material for its local steel making industry.

Realising that iron ore traffic is unlikely to be its growth driver given the clampdowns on exports, Dhamra port has lined up Rs 10,000 crore second phase expansion plan . The expansion is set to add 75 million tonne capacity which will be over and above the port’s existing capacity of 25 million tonne. Full scale expansion will raise the port’s berth strength to 13 with the port being able to handle container cargo, liquid cargo, LNG (liquefied natural gas) and crude oil.