Noble Group pulls out of Gopalpur port SPV

Close on the heels of the Gopalpur Port Limited (GPL) announcing a financial closure of Rs 848.78 crore for the first phase of the port expansion project, Hong Kong-based Noble Group Limited, one of the partners of the consortium, has pulled out of the project.

Richard Elman, executive chairman of Noble Group has said in a public notice that the Group is not involved in the expansion, development and operations of the Gopalpur Port.

The company has reportedly taken this extreme step expressing displeasure over the current functioning of the special purpose vehicle (SPV) formed for the port development where the company’s say has been completely ignored. It may be noted that Noble Group along with Orissa Stevedores Limited (OSL) and Sara International Limited had formed a SPV to develop the defunct Gopalpur port into an all-weather and a major port at an investment of around Rs 2500 crore.

The port was to be developed on build, own, operate and transfer (BOOT) basisGPL had signed a memorandum of understanding (MoU) with the state government in 2006.

Gopalpur Port Limited (GPL) authorities on Sunday, however, said there would be no impact on the proposed expansion and development of the port project in the future due to the exit of Noble Group.

“Noble was virtually out of the project since long as the Hong Kong based company was not showing any interest on it. Besides, the company officials of the Noble Group did not attend a single meeting of the board of directors since the formation of the SPV and therefore the Group’s decision to pull out of the project has not come as any surprise”, said Manmohan Maharana, one of the directors of GPL.

“The port project will proceed as per its schedule and it set to become an all-weather port by the end of the next year,” he clarified.

GPL aimed to construct at least three berths to handle about five million tonnes of cargo in the next phase of expansion.

Work on the Gopalpur port has commenced within three months of signing of the MoU between the state government and GPL for the development of the port in 2006.

The first phase expansion of the port would cost Rs 1400 crore While GPL has tied up Rs 848.78 crore through debt from a consortium of 11 banks, the remaining amount is to be raised by the promoters from internal accruals.