Essar’s Hazira Port investing Rs800 cr to expand capacity by 40%

Essar Bulk Terminal Ltd (EBTL) on Monday announced plans to expand bulk handling capacity at its all-weather dry and general cargo terminal at Hazira Port by 40 per cent, involving an investment of over Rss800 crore.

The expansion will increase the capacity of the terminal from the existing 30 million metric tonnes per annum (MMTPA) to 50 MMTPA, by December this year.  EBTL is a special purpose vehicle of Essar Ports Ltd

The company is investing Rs800 crore to add 20 MMPTA at its Hazira Port in Surat to its existing 30 MMTPA capacity, Essar Ports chief executive Rajiv Agarwal told reporters.

He said the expansion work has been going on since the last one-and-a-half years, adding that with this investment the company's total investment in Hazira Port has gone up to Rs3,250 crore.

The expansion will take EBTL terminal's berth length from 550 metres at present to 1,650 metres. The port is also strategically located to serve demand of the landlocked northern and north-western regions of India.

The port has a draft of 14 metres, which allows direct berthing of large bulk cargo carriers. For this, the Essar Ports had to dredge around 8.8 km-long and 300 metre wide channel at the mouth of the river Tapi by excavating around 80 million cubic metre of silt from the river.

This all-weather mechanised deep draft port will be capable of simultaneously handling around seven cape size vessels at any point of time.

"The 550-metre berth of Essar Bulk Terminal is being expanded by a further 1,100 metre to take it to 1,650 metre. We have already completed work on 330 metre and expect to complete 1,100-metre terminal by December," Agarwal said.

"Post-expansion, the terminal will have the capacity to simultaneously handle seven vessel at any point of time. Currently, the terminal handles two vessels," he said.

The Hazira Port has witnessed 80 per cent increase in cargo handling capacity in the first quarter of FY17 to 4.4 MMT, as against 2.4 MMT in the corresponding quarter in the previous fiscal, Agarwal said, adding cargo handling is expected to reach 24 MMT in FY 2016-17.

The cargo growth is backed by a ramp up of operations by Essar Steel Plant, which accounts for a bulk of freight handled by the Port, he said.

The capacity expansion will also help Essar ports handle third-party cargo, including chemicals, petrochemicals, coal, iron ore, limestone and dolomite, among other commodities.

EBTL has also received permission from the Gujarat Maritime Board to handle 15 MMT of third-party cargo over three years, he said.

"With this, our third-party cargo handling capacity is expected to grow to 5 MMTPA by financial year 2018 from 0.75 MMPTA in FY 2016," Agarwal said.

Essar Ports has a combined current capacity of 140 MT at Hazira, Vadinar, Paradip, Salaya and Vizag ports, which are estimated to handle around 80 MT cargo in the current fiscal year.

Essar's deep-draft Vadinar Port has a 58 MT liquid cargo handling capacity while the Paradip and Vizag dry bulk terminals have 16 MT capacity each, and the newly commissioned dry bulk terminal at Salaya (in Gujarat) can handle 20 MT.