Sical to build Rs 5.5 bln iron ore terminal at Ennore Port

Sical Logistics Ltd has announced that Ennore Port Ltd has chosen the Sical-led consortium to build an iron ore terminal at Ennore port near Chennai in southern India. Prof. K Anbazhagan, Finance Minister of Tamil Nadu state, on Sunday handed over the letter of intent to the Companys Chairman Dr. AC Muthiah at a function presided over by TR Baalu, Indias Minister for Shipping, Road Transport and Highways, to inaugurate Ennore Ports new corporate office in Chennai.

The project is estimated to cost nearly Rs 5.5 billion. Operations are scheduled to begin in financial year 2008-09.

The iron ore terminal will be developed on a build-operate-transfer (BOT) contract for 30 years including the construction period. The terminal will have a capacity for 12 million tonnes of cargo per year, expandable to 15/20 million tonnes per year. Facilities include a jetty, ship loader, mechanized handling system with conveyor, storage, and a wagon unloading system.

Initially, the terminal will handle Panamax and Cape size vessels up to 150,000 DWT; after dredging, the terminal would be able to handle vessels of 225,000 DWT. Other features include the capability of an average 75,000-tonnes-per day ship loading rate; a stockpile area that can store 1.2 million tonnes of iron ore; and a railway wagon unloading system that can handle up to twelve 3500-tonne rakes per day.

The project, to be implemented on a revenue sharing basis with Ennore Port, is expected to generate nearly Rs 2 billion in annual revenue.

Ashwin Muthiah, Vice Chairman, of the Company, said that the Ennore terminal would provide a major boost to iron ore movement in southern India, and, consequently, to the economy of the region.

Iron ore exporters in southern India will soon get a world class terminal to berth cape size vessels with fast loading rates that conform to international benchmarks, Mr. Muthiah said. "The Ennore Port Terminal will open up major possibilities, both in terms of direction and volume of movement, given its location on India’s eastern coastline, close to the strong demand centers in the Asia-Pacific, he added.

The terminal further strengthens the Sicals strategic framework of multi-modal integrated logistics, Mr. Muthiah said, Taken together with Sicals trucking operations and plans for container trains, the value proposition to the customer is clear-a significant debottlenecking of the supply chain, resulting in a seamless flow from the mines to the terminal and to the ultimate destination ports. he said.

Source : Equity Bulls

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