The Hindi Business Line
March 22, 2008
Major equity holders
Tata Sons now holds a 30% stake, against 26%
Nagarjuna Group has 51% stake, while Suntera Resources has 10%, Tamil Nadu Industrial Development Corporation Ltd 5% & Uhde GmbH 4%
Chennai, March 21 Tata Sons has increased its stake in the 6-million-tonne refinery being set up by the Nagarjuna Group at Cuddalore in Tamil Nadu. With this, there has been a slight change in the equity holding pattern.
Against a 26 per cent stake earlier, Tata Sons Ltd will now hold a 30 per cent stake in the Rs 1,372-crore equity of the company. The other stakeholders are: Nagarjuna group with 51 per cent; Tamil Nadu Industrial Development Corporation Ltd, a State Government undertaking, with 5 per cent; Uhde GmbH of Germany, the technical collaborator, with 4 per cent; and Suntera Resources Ltd’s 10 per cent. Earlier, Exim Bank had a 1 per cent stake and Uhde 7 per cent.
Nagarjuna Oil Corporation Ltd, the company putting up the refinery, has tied up for marketing petroleum products within the country and for crude and international marketing of products. The project cost is Rs 4,790 crore.
When contacted on Friday, Mr K.S. Raju, Chairman of Nagarjuna Fertilizers and Chemicals Ltd, the main promoter of the refinery, and a director on the board of Nagarjuna Oil, said “The documentation for the loans is being finalised and we should sign it any time now.” There is interest from other companies for an equity stake in the project, but “these are the main equity partners”.
Those associated with the project say that Cuddalore Port Company Pvt Ltd is keen to pick up a stake in the project. Cuddalore Port Company was earlier involved with the Kakinada Port project.
According to Mr Raju, Nagarjuna Oil has signed up with BP for sourcing crude and for international marketing of petroleum products, and with IOC for domestic marketing of products from the refinery.
A consortium of banks and financial institutions led by IDBI is providing the debt for the project. IDBI has so far sanctioned more than Rs 500 crore as term loans and SBI Rs 300 crore.
Nagarjuna Oil Corporation has spent Rs 1,160 crore on the project as of March 31, 2007. Equipment for the project is coming from a Mobil refinery that has been dismantled in Germany. While some of the equipment has landed in Cuddalore, others are in various European ports.
Crude for the refinery will be unloaded at a single point mooring 7-8 km away from the coast and transported through submarine pipes. The refinery will have jetties that can handle ships of 50,000-60,000 tonnes to evacuate products, according to officials associated with the project.
Under a new policy of the Tamil Nadu Government, Nagarjuna Oil Corporation can develop a minor port and handle other cargo, to improve the economic viability of the port.