India: Essar Looks to Invest Overseas
|
|
|
|
Tuesday, 29 April 2008 |
|
Having announced plans to expand its Vadinar refinery from 10.5
million tonnes to 34 mt by 2010, Essar Oil is looking to invest in retail marketing and distribution assets abroad.
Mr Naresh Nayyar, MD of Essar Oil has stated “To find a permanent home
for our products, we are aggressively
looking for distribution and marketing opportunities abroad,” . The
company is expecting to firm up deals in this regard in 2008-09.
It may be mentioned that Essar had previously created a retail
market place for its products in India. However, the plan did not take
off due to the Government’s policies to keep the retail market prices
of auto fuels at artificially low levels vis-À-vis crude price
volatility.
Essar’s 1,215-strong retail outlet business in India is currently in
“maintenance mode” and is incurring a loss of $10 million annually.
According to Mr Nayyar, taking advantage of the demand-supply gap in
diesel and LPG in the country, Essar currently sells its entire
production to public sector marketing companies. However, most of its
petrol and furnace oil production are exported.
He did not disclose the possible overseas markets the company was
looking at.“Economics of supply logistics will play a crucial role in
our search,” Mr Nayyar said.
Meanwhile, Essar is waiting for the Kenyan Government’s approval –
which owns 50 per cent in the refinery and has a first right of refusal
– for acquiring the residual 50 per cent stake in Kenya Petroleum
Refineries from Shell Petroleum Company, Chevron Global Energy Inc and
BP Africa.
PetrolWorld 280408
|
