Essar Ports to secure Rs 700-cr loans for Vizag port in 6 mths

Essar Ports, the country's second largest private port operator, is looking to secure finances of about Rs 700 crore for developing three iron ore berths at the Visakhapatnam port in next 6 months, a top company official said.

In June, the company had won the bid for mechanisation and operation of three iron ore berths at Visakhapatnam Port, which will have a combined capacity of 23 million tonnes per annum (MTPA). The total project cost is estimated to be about Rs 1,000 crore.

"We may be taking about Rs 700 crore loans out of the Rs 1,000 crore project cost. The loans will be taken for next four years. We have to go for financial closure, in next six months we should be able to close it," Essar Ports' Managing Director Rajiv Agarwal told PTI.

He further said that the company is looking to complete the formalities and transfer of assets for the iron ore berths at Visakhapatanam port in next three months and immediately after that, the company can begin operations as they are existing berths and are operational.

The three iron ore berths at Vizag port alone would add 17 MTPA of third-party cargo for Essar. After their modernisation, total iron ore handling capacity of the Ruias-promoted firm would on the East Coast will become 39 MTPA as it already has one iron ore berth of 16 MTPA capacity at the Paradip port.

The iron ore berths at the Visakhapatnam port have the highest peak loading rate of 8,000 tonnes per hour and deepest draft terminal in the country.

Essar currently has a cargo handling capacity of 104 MTPA. The company is expanding its cargo handling capacity by 74% to 181 million tonnes (MT) annually by 2015-16.

By next financial year, it is planning to operate two new facilities -- 20 MTPA dry bulk terminal at Salaya and expansion of its existing Hazira terminal by another 20 MTPA. Construction of 14 MTPA coal berth at Paradip port will be over by 2015-16.