Essar Ports Ltd has commissioned its 16-million-tonne (mt) dry bulk terminal at Orissa’s Paradip Port, which will handle iron ore, mainly for its group company, Essar Steel, and dry bulk cargo for third party contracts.
“The project involved the upgradation and mechanisation of the existing 230m long CQ3 berth at Paradip with installation of a fully mechanised ship-loading system with a capacity of 5,000 tonnes per hour,” the company said in a statement.
This is an all-weather terminal with an ability to handle large size ships. Essar Ports has a licence to operate this terminal till 2020 with an option to extend the licence period by further five years.
With this, the total capacity of Essar Ports has reached 104 mt per year. The company is expanding its capacities to 158 mt and is expected to reach that level by 2014-15.
The terminal will be used to handle iron ore pellets of Essar Steel. This business is going to grow further as the steel arm of Essar Group has only commissioned a 6 mt per year pellet plant at the moment.
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The company is in advance stages of construction of the second phase of the 6-mt capacity, taking the total pellet capacity to 12 mt.
Apart from this, the company is setting up a terminal at Paradip, which will have the capacity to handle 14 mt of coal every year. It is also setting up a dry bulk terminal at Salaya with a capacity of 20 mt.
Its flagship Hazira, Gujarat, port currently has 30 mt capacity and Essar Ports is looking to increase it by 20 mt.
The company is now looking to bring down its interest cost burden by refinancing loans. In September, it refinanced Rs 405 crore loan to save Rs 10 crore annually on interest costs.
It has also asked the Reserve Bank of India to allow the company to raise Rs 1,500 crore through external commercial borrowings as a special case to refinance its loans.
The company has a total debt of Rs 5,500 crore.
