Coal News We love to talk!
Edelweiss Asset Reconstruction Co. (ARC) Ltd is in advanced talks with the Netherlands-based Stolt-Nielsen Ltd to set up an LNG terminal at Karaikal port on the east coast, two people familiar with the development said.
The liquefied natural gas (LNG) terminal, when commissioned, will give a boost to the port’s fortunes given that it is currently equipped to handle only bulk cargo, the two persons cited above added.
“Given the fact that most of India’s LNG terminals are located on its western coast, setting one up at Karaikal, which is on the east coast, will undoubtedly turn around the port. Setting up a container terminal at the port is also being discussed,” one of the two people cited above said.
Karaikal Port Pvt. Ltd (KPPL)—a special purpose vehicle—was set up in 2006 after a concession agreement was signed between the Puducherry government and Marg Ltd to set up an all-weather port in Karaikal.
But after getting commissioned in 2009, the port ran into rough weather and struggled to service its debt. That’s when Edelweiss ARC came into the picture and started accumulating its debt; it currently holds over 95% of the port’s outstanding debt.
Earlier this year, the ARC also took control of the day-to-day operations of the port, which Marg was earlier unwilling to cede. That was the reason for the Shapoorji Pallonji Group not picking up a 51% stake in the port, even though the valuation too had been agreed on, Mint reported in March.
“While Edelweiss is doing a good job of turning the port’s fortunes around, a big challenge for it is that the four private equity (PE) players—Jacob Ballas India, Standard Chartered PE, IDFC Project Equity and Ascent Capital—that together hold over 40% of its equity, don’t see eye to eye. That’s a bit of a roadblock since the structure that’s being planned would require the LNG terminal operator to bring in a substantial amount of equity,” said the second person cited above.
Hence, he added, the signing of the final term sheet will take a couple of months more and the project will take off only after 4-5 months. Last month, The Economic Times had reported that Edelweiss ARC was looking to set up an LNG terminal at Karaikal port, a move that would push back the exit plans of its PE investors.
Emails sent to Karaikal Port remained unanswered till the time of going to print. An official spokesperson for Edelweiss ARC refused to comment on the issue.
- The truth behind Indias electricity exporter status Read more
- GAIL pipeline catches fire in Moti Bagh Read more
- ONGC Videsh eyes oil & gas blocks in Colombia Read more
- EU refuses to budge on GVK Bio case, closes talks Read more
- ONGC retains top slot among PSUs, BSNL worst performer: Survey Read more
- IOC announces Rs 1.80-trn investment plan in next 6 years Read more
- ONGC submits draft field development plan for KG discoveries Read more
- Tajpur port not to hinder Rs 500 croreHaldia Multi-Modal Terminal project Read more
- Govt to modify coal distribution policy for fuel cost pass through Read more
- Warburg Pincus may invest $75 milion in CleanMax Solar Read more