Aegis Logistics to build oil terminal at Pipavav

CRUCIAL LINK: APM Terminals Pipavav Managing Director Prakash Tulsiani (left) shakes hand with Aegis Logisitcs President S.O. Malhotra at a press conference in Mumbai on Tuesday. Photo: Shashi Ashiwal

Aegis Logistics will build a six lakh kilolitre (kl) oil terminal at Port Pipavav at a cost of Rs.430 crore. The company, a leader in oil, gas and chemical logistics, has tied up with APM Terminals Pipavav to sub-lease 100 acres to build the terminal and a petrochemical complex. The project is expected to come up in the next three years.

The company plans to invest around Rs.2000 crore in the next 5-7 years in port infrastructure that includes the Pipavav project. For this, Aegis intends to pump in 60 per cent as equity and the balance through debt.

Aegis Managing Director and CEO Anish Chandaria said, “for the equity portion, we have already announced a fund raising programme of up to Rs.100 crore through qualified institutional placement. The balance will come from internal cash. For the debt portion, we will either go in for an external commercial borrowing (ECB) or raise it from the International Finance Corporation (IFC).''

Aegis now operates three terminals — two in Mumbai with a capacity of 2.50 lakh kilolitres (kl) and one in Kochi (capacity of 55,000 kl).

“The facilities at Port Pipavav will service oil companies that wish to use the port for import and export of oil and petrochemical products,'' said Mr. Chandaria. “For the first time, India is becoming part of the Asian supply network for oil and this port will be a strategic infrastructure for contango and arbitrage trading strategies. With our existing locations in Mumbai and Kochi, we are one step closer to achieving our stated aim of creating a ‘necklace' of similar port terminals around the coastline of India. We will also be expanding our capacity in Kochi by 50 per cent and building 80,000-kl facility in Haldia port,'' he said.

Mr. Chandaria said the company now supplies LPG in 10 States through 70 fuel stations. “The strategy is to take this number to 300 stations in the next few years,'' he said.

Aegis also has two gas terminals in Mumbai and Pipavav through which it handles over two million tonnes of oil, gas and petroleum products annually, besides about 400,000 tonnes of LPG and propane gas.

With the new project, Aegis' liquids capacity will rise from three lakh kl to over one million kl in the next three years. “We are targeting two more thereafter on the southeast coast and southwest coast to complete the necklace,' he said.

Aegis reported a turnover of Rs.500 crore last year.