Essar Ports, one of the largest private sector port companies in India, has announced it has signed a contract for its first first overseas port project at Mozambique. 

Essar Ports has signed a 30-year concession agreement with the Government of Mozambique to develop a new coal terminal at Beira Port, as part of a Public Private Partnership (PPP) project. 

The project will be executed on Design, Build, Own, Operate and Transfer (DBOOT) basis through a subsidiary, New Coal Terminal Beira, SA (NCTB SA), which is a joint venture of Essar (which will own 70) and Portos e Caminhos de Ferro de Moçambique (CFM, which will own 30%). The project will enhance the coal handling capacity of Mozambique by 20 Million Tons Per Annum (MTPA) in two phases of 10 MTPA each.

The first phase of this project will be developed at a cost of close to US$275 million and will entail developing dedicated berths, along with state-of-the-art, mechanised and environment-friendly systems. Once operations commence, substantial direct and indirect employment opportunities will be created for the country's citizens through downstream production and expansion in the supplier and service industry.

Mozambique is estimated to have reserves of over 23 billion tonnes of coal, which makes the country a major coal exporter that is well placed to cater to the international steel & power industries, especially in India, China, Japan and Korea. The NCTB has dedicated rail connectivity to Mozambique's coal mining belt in the Tete region, which CFM has recently enhanced to a capacity of 20 MTPA.

Mr Rajiv Agarwal, CEO & Managing Director, Essar Ports, said: 

"We would like to congratulate the Government of Mozambique for this initiative and for partnering with Essar on such a prestigious national-level project. It will not only boost coal exports from Mozambique and strengthen its economy, but also deliver significant direct and indirect benefits."

Essar Ports has an existing aggregate capacity of 120MTPA across facilities located at Vadinar and Hazira in the state of Gujarat on the west coast of India and one dry bulk export terminal at Paradip in the state of Orissa and two iron ore berths in outer harbor of Visakhapatnam Port in the state of Andhra Pradesh on the east coast of India.