Essar Ports handles record cargo during March 2016

On the back of increased production by its anchor customers, Essar Ports Limited (EPL) has registered significant growth in cargo handling over the last three months. In March 2016 alone, EPL’s four operational ports handled total cargoes of 6.25 million t, which translates to a run rate of 75 million tpy. With the recent commissioning of the 20 million t Salaya Bulk Terminal, cargo handling will see a further boost in 2017.

The contribution of third party traffic to overall cargo handling stands at about 10% currently. About 90% of the cargo handled at EPL’s Hazira, Vadinar, Vizag and Paradip ports is contracted with captive businesses, like Essar Steel India Ltd, Essar Oil Ltd and Essar Power Ltd. The company expects cargo handling to increase from 59 million t in FY2016 to 85 million t in 2017 – a growth of more than 40% on year on year basis.

Essar Bulk Terminal, Hazira

The bulk terminal at Hazira handled 1.62 million t of cargo in March 2016, largely to service the requirements of its anchor customer, Essar Steel India, which has enhanced its capacity utilisation. This resulted in higher cargo volumes of both raw material and finished products. The terminal also handles cargo, primarily coal, of third party customers. With Essar Steel’s production expected to rise further during 2017, total cargo handling at Hazira is expected to reach 25 million t in 2017.

Vizag Terminal

EPL’s iron ore terminal at Vizag handled 0.95 million t of cargo in March 2016. The main form of cargo at this terminal is pellets for Essar Steel, and the iron ore supplied by National Mineral Development Corporation (NMDC) to its clients. Both these cargo movement contracts are long term and sustainable in nature. With prices of iron ore firming up, third party exports are also expected to pick up in 2017 and total traffic is expected to be 12 million t.

Paradip Terminal

EPL’s bulk cargo export terminal at Paradip Port has also registered good performance, having handled 0.4 million t in March 2016. Essar Steel’s pellet plant at Paradip, which is its primary customer, is recording continuous performance improvements. With the second unit of the pellet plant close to commissioning, traffic at the Paradip Terminal during 2017, is expected to be more than 5 million t.

Vadinar Terminal

The liquid terminal at Vadinar has shown consistent growth in traffic. In March 2016, it handled 3.28 million t of liquid cargo. The Essar Oil refinery at Vadinar has demonstrated sustained growth. The refinery’s capacity has increased from 10.5 million t in 2008, when it was commissioned, to 20 million t currently. With no plans for a refinery shutdown in 2017, the cargo traffic through Vadinar terminal is expected to be over 40 million t.

Commenting on the performance, Rajiv Agarwal, Managing Director, Essar Ports said, “The rising volumes of cargo handled at our various ports and improved operational performance, reflects the modern facilities at our ports. This will only help our customers with faster turnaround of ships and better utilisation of capacities in the current year.”

Background

Essar Ports is one of the largest port companies of India, with a current capacity of 140 million tpy. The capacity is being expanded to 194 million tpy over the next few years. Essar Ports has five operational port terminals at Hazira, Vadinar, Paradip, Salaya and Vizag, that are estimated to handle approximately 85 million t of cargo during 2017.

The Hazira port is an all-weather, deep draft port with 30 million tpy of dry bulk and break bulk cargo handling capacity. Vadinar is also an all weather, deep draft port with 58 million tpy of liquid cargo handling capacity. The Paradip dry bulk terminal is an all weather, deep-draft port with 16 million tpy of dry bulk cargo handling capacity. The Vizag terminal, which was taken over in May 2015, has a capacity of 16 million tpy. The company’s newly commissioned dry bulk terminal at Salaya has increased its overall capacity by a further 20 million tpy.

Additionally, the company is expanding its Hazira port capacity by 20 million tpy, taking the total capacity to 50 million tpy. The company is also undertaking capacity addition of its iron ore berths at Visakhapatnam Port to take total capacity of 16 million tpy. The company plans to develop a coal terminal at Paradip of 18 million tpy capacity.

Adapted from press release by Rosalie Starling

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