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Essar Ports bags first overseas project in Mozambique

The port will be developed in partnership with the Mozambique government in a concession agreement to be in force for thirty years.

, ET Bureau|
Updated: Aug 04, 2017, 06.59 PM IST
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The project will enhance the coal handling capacity of Mozambique by 20 MTPA in two phases of 10 MTPA each.
The project will enhance the coal handling capacity of Mozambique by 20 MTPA in two phases of 10 MTPA each.
MUMBAI: Essar Ports, on Friday, said it has signed a pact for its first first overseas port project at Mozambique.

The concession agreement was signed with the Mozambique government to develop a new 20 million tons per annum coal terminal in Beira Port.

The port will be developed in partnership with the Mozambique government in a concession agreement to be in force for thirty years.

The first phase of the project would entail an investment of $275 million.

"There are massive coal reserves in the location and limited infrastructure. We found that a good opportunity. This has been on for the last five to six years," said Rajiv Agarwal, CEO of Essar Ports.

The project will be executed on a design, build, own, operate and transfer (DBOOT) basis through a subsidiary, New Coal Terminal Beira, SA (NCTB SA), which is a joint venture of Essar (which will own 70%) and Portos e Caminhos de Ferro de Moçambique (CFM, which will own 30%).

The project will enhance the coal handling capacity of Mozambique by 20 MTPA in two phases of 10 MTPA each.

Mozambique is estimated to have reserves of over 23 billion tonnes of coal, which makes the country a major coal exporter that is well placed to cater to the international steel & power industries, especially in India, China, Japan and Korea.

The NCTB has dedicated rail connectivity to Mozambique’s coal mining belt in the Tete region, which CFM has recently enhanced to a capacity of 20 MTPA. The first phase of this project will entail the development of dedicated berths, along with state-of-the-art, mechanised and environment-friendly systems.

Essar Ports has a current capacity of 140 million tons per annum. The capacity is being expanded to 194 million tons over the next few years. Essar Ports has five operational port terminals at Hazira, Vadinar, Paradip, Salaya and Visakhapatnam.

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