Yesterday, the Essar Ports Limited (EPL), which is India’s second largest privately-owned port and terminal operator, took over the Vizag iron ore outer harbor terminal from Vishakhapatnam Port Trust (VPT).
The Essar Ports Limited signed the concession contract for 30 years to finance, design, construct and operate the facility. Their wholly owns subsidiary, the Essar Vizag Terminals Limited (EVTL), will operate the two already active outer harbor berths and another one inner harbor berth with a combined capacity of 23 million tonnes per annum (MTPA).
The construction works of the new berth and upgrades to the two existing berths will be achieved in two different phases.
The estimated project cost is expected to be about Rs 1,200 crore (USD 190 million) over a period of three years and will cover the upgradation of Outer Harbor Berths (OB I & II) in Phase I and mechanization of inner harbor berth (WQ-I) in Phase II.
Terminal’s operation and upgrade will be carried out at the same time, after the takeover of the outer berths.
The Essar’s Ports CEO and Managing Director, Rajiv Agarwal, said:
”The facility is well placed to cater to both the domestic and international steel industry. It will serve major iron ore consuming countries like China, Japan and Korea in addition to coastal movement within India. The facility has dedicated rail connectivity to India’s iron ore mining belt. This, along with the mechanized CQ III facility in Paradip port, will take Essar Port’s total east coast iron ore handling capacity to 39 MTPA.”
The ore handling complex of the VPT was taken over by EVTL, which paid in advance the amount of Rs 185 crore. Furthermore, EVTL will pay a revenue share to VPT as well. The Vishakhapatnam Port Trust had handled close to 14 MT of iron ore during 2014, the highest quantity compared to any other port in the country.