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Essar Energy - India (ESSR)     

HARRYCAT - 23 Jul 2010 14:56


July 2010 - Market Cap of £6bn ; Founded in 1969.
Floated on the LSE in May 2010
Indian parent Company Essar Group comprising Essar Oil & Gas, Essar Power.
Specialising in power generation & oil & gas operations in India

HARRYCAT - 17 Jul 2012 11:25 - 81 of 101

Essar Oil notes Supreme Court order regarding sales tax petition
July 17 2012: Essar Energy plc [LSE: ESSR], today announced that its subsidiary Essar Oil has today been directed by the Supreme Court of India to pay Rs.10 billion (c.US$182 million) to the Government of Gujarat by July 30 in relation to its deferred sales tax liability.

The Court also today ruled that once the Rs.10 billion has been paid, any other coercive steps being taken by the Government of Gujarat to force immediate payment of the remaining principal amount owed, of Rs.51.69 billion (c.US$939 million) would be stayed.

Essar Oil is seeking guidance from the Supreme Court on a repayment schedule and the waiver of interest in relation to the deferred sales tax liability of Rs.61.69 billion (c.US$1.12 billion). Essar Oil had offered to pay the Rs.10 billion (US$182 million) sum as part of its submission to the Supreme Court, which is due to hear Essar Oil's petition on July 31 2012.

As previously announced, Essar Oil is also in advanced discussions with Indian lenders to put in place a Rs.50 billion (c.US$909 million) loan facility as a contingency measure for use in the event that the sales tax liability becomes payable immediately or that Essar Oil is not able to negotiate a satisfactory repayment schedule. This facility is expected to be finalised shortly.

jimmy b - 23 Jul 2012 10:33 - 82 of 101

Essar Oil secures loan to repay deferred sales tax liability
Essar Energy subsidiary Essar Oil has secured a new credit facility with its Indian banks of up to Rs.50bn to meet the deferred sales tax liability of Rs.61.69bn owed to the Gujarat government.

Essar Oil continues to pursue the matter of a schedule for repayment of the sales tax liability both by legal means and with the government of Gujarat.

Essar Oil is confident that with this Rs.50bn facility in place it will be in a position to meet its entire repayment obligations.

At 9:48am: (LON:ESSR) share price was -0.55p at 112.45p

Story provided by

HARRYCAT - 25 Jul 2012 08:09 - 83 of 101

Essar Energy agrees new oil and product inventory arrangements for Stanlow refinery
July 25, 2012: Essar Energy plc [LSE: ESSR], the India-focused integrated energy company, today announced that its subsidiary Essar Oil UK has entered into new arrangements with Barclays Bank plc covering the supply of crude oil to its Stanlow refinery in the UK.

Under the new arrangements, Barclays will hold the inventories of crude oil and petroleum products at Stanlow and will supply crude to the refinery in line with its requirements.

The new arrangements allow Essar Oil UK to repay its existing working capital revolving credit facility, provided by 13 banks. In addition, they allow Essar Oil UK to reduce its costs by reducing its crude oil inventory holdings and also permit greater operational flexibility. The customer relationships and product sale processes will remain with Essar Oil UK. These arrangements with Barclays are for three years and take effect immediately.

HARRYCAT - 31 Jul 2012 11:19 - 84 of 101
Essar Energy subsidiary Essar Oil has made an initial payment of Rs.10bn to the Gujarat government in respect of the deferred sales tax liability from the Vadinar oil refinery of Rs.61.69bn.

Essar Oil continues to pursue the matter of a schedule for repayment of the overall sales tax liability both by legal means and with the Government of Gujarat.

Essar Oil announced on 23 July that it has secured a new credit facility with its Indian banks of up to Rs.50bn to meet the deferred sales tax liability as required.

HARRYCAT - 13 Sep 2012 16:12 - 85 of 101

Supreme Court decides on sales tax repayment schedule and interest due

September 13, 2012:

Essar Energy plc [LSE: ESSR], the India-focused integrated energy company, today announced that in respect of its subsidiary Essar Oil, the Honourable Supreme Court of India has today passed a judgement in the Gujarat sales tax case.

The judgement directs Essar Oil to repay the sales tax balance owed in instalments spread over two years. This balance of Rs.51.65 billion (c.US$939 million) is now payable in eight quarterly instalments beginning on 2 January 2013.

A demand by the Gujarat Government for approximately Rs.18 billion (c.US$327 million) in respect of interest for the period up to 17 January 2012, has been dismissed by the Hon Supreme Court.

In respect of interest for the period subsequent to 17 January 2012, the Supreme Court directed Essar Oil to pay at a rate of only 10% per year, as against 18% per year demanded by the Government of Gujarat.

The Supreme Court judgement brings to an end the deferred sales tax repayment issue in respect of Essar Oil.

Activmoto - 04 Apr 2013 15:57 - 86 of 101

Todays news about refinacing the Rupee dept in to Dollar is good for investors.
At least it means the books have been fully checked over and approved.

Some news about the Raniganj gas field should move the SP up.

Put on your watch list

Activmoto - 11 Apr 2013 16:47 - 87 of 101

More news

HARRYCAT - 11 Apr 2013 16:53 - 88 of 101

Looks like some of the Indian interests are not so keen on being so far in chinese pockets. Market forces v politics.

Activmoto - 03 May 2013 08:41 - 89 of 101

Essar Seeks Permission to Explore For Shale Gas In Cambay Pre-NELP Block Under Existing PSC.
The Production Sharing Contract for the pre-NELP block CB-ON/3 which Essar signed with the government of India permits exploration in ‘Crude Oil & Natural Gas existing in their natural conditions’. Thus, this definition per se includes the Shale Gas/Oil which is ‘Crude Oil & Natural gas’

Activmoto - 10 May 2013 14:53 - 90 of 101

Positive news and outlook from Essar Oil

Activmoto - 16 May 2013 12:01 - 91 of 101

Every penny counts

Activmoto - 21 May 2013 08:58 - 92 of 101

This news on Essar from the India times. Moving their debt to dollars is a step change to making better margins.

MUMBAI: The Essar group, owned by billionaire brothers Shashi and Ravi Ruia, will sign agreements with a leading Chinese bank and its largest oil and gas producer and distributor, deepening the BPO to steel conglomerate's engagement with the world second largest economy.
During Chinese Premier Li Keqiang's state visit to India -- his first overseas since taking office in March - Essar Group flagships Essar Oil and its London listed parent Essar Energy Plc will enter into a multi-level financial agreement with China Development Bank (CDB), the world's biggest policy bank and PetroChina Company, the oil and gas producer and distributor, said multiple sources aware of the plans. This, according to some of the sources, could even be a precursor to a deeper relationship between the two sides, possibly culminating in an equity deal involving Essar's mega 20 million tonnes per year (MTPA) coastal refinery at Vadinar, Gujarat.
On Tuesday, Essar Energy and its locally listed refining subsidiary Essar Oil will sign an agreement with CDB to raise $1 billion by way of external commercial borrowings (ECBs) from the Chinese banking system. In return, PetroChina will sign a long-term 'off take' agreement with Essar for 7 to 10 years for a fixed quantum of products linked to the loan amount.

"Typically these off take arrangements or coverage ratios in industry parlance are two to three times the loan amount. Such trades are quite common for global commodity traders like Glencore or even a premier political and policy bank like the CDB," said a London- based corporate finance banker, specializing in energy trades who is aware of the upcoming transaction. "The price discovery mechanism is benchmarked to prevailing international prices or a pre-agreed pricing formula," he added.

Responding to a detailed questionnaire, an Essar Oil spokesperson said: "As part of our initiative to dollarize our debt, we have been in discussion with several international banks, including Chinese banks. CDB is part of that conversation. After our expansion, we have been sourcing a significant portion of our crude from Latin America with a view to meet our increased requirement of ultra heavy crudes. PetroChina is a strong player in this region and will thus continue to be an important trade counter party for us."

Mails sent to CDB and PetroChina did not get any response. However, CDB's new Chairman Hu Huaibang is expected to attend Tuesday's deal signing in Mumbai along with the CEO of PetroChina International - the group's arm for global business and energy trading.

Activmoto - 17 Jul 2013 10:50 - 93 of 101

Positive news continues for Essar

Essar Energy announces US$125 million bond issue in power business.

Essar Power was assigned a credit rating of A+ by ratings agency Credit Analysis and Research Ltd (CARE), of Mumbai, in October 2012 in respect of the proposed Rs.50 billion bond issue.

Activmoto - 23 Jul 2013 08:31 - 94 of 101

Essar Energy on lookout for partners for oil & gas assets By Vikas Srivastav Jul 16 2013

Essar Energy, the holding company of Essar Oil in India, plans to get equity partners in some of their oil and gas assets in India and abroad on the lines of a Mumbai offshore block where Noble Energy of US holds 50 per cent interest.

Iftikhar Nasir, CEO, E&P of London-listed Essar Energy, told Financial Chronicle, “At the moment, we have a partnership with Noble Energy for our Mumbai offshore block and we are looking for partnership in other blocks as well as we develop other opportunities. On case-by-case basis we would decide on the amount of equity to be shared with the partners. However, the hike in gas price would give us the opportunity to look at it positively.” Nasir declined to specify which block he would be looking to farm out in near future.

In an oil and gas block there always remains an option to share the risk after a certain level of development by bringing in new partners. “It is a very fluid arrangement within the exploration and production arena to farm in or to farm out. We are looking at this option even for our foreign blocks,” he said.

Essar Group together have global portfolio of onshore and offshore oil and gas blocks with about 35,000 sq km to explore.

Essar Oil, which looks after the India focused operations, has reserve potential of around 1.7 billion barrels of oil equivalent across eight oil and gas blocks in India. This includes around 10 tcf of gas from the 5 coal bed methane blocks (CBMs). Besides the company has two offshore assets: one is offshore Mumbai block and the other is Ratna & R Series block. Apart from offshore the company has two onshore blocks in Mehsana, Guajarat and an onshore gas block in Assam. Of all these blocks the company has only one partner in the offshore Mumbai block. It would look at partnership in the remaining blocks.

Essar Energy that takes care of the international blocks has exploration and production resources of 2.1 billion barrels of oil equivalent. This includes Vietnam, Madagascar, Nigeria and Indonesia. Of these Essar has got partners only for Vietnam that is Eni. It will look at partners at the remainder of the blocks in Indonesia, Nigeria and Madagascar.

Essar is also planning to enter into the shale gas exploration business and is awaiting the shale gas policy that it expects to come in next six months time.

Activmoto - 12 Aug 2013 08:47 - 95 of 101

Essar - high growth potential 180 target

Activmoto - 22 Aug 2013 14:39 - 96 of 101

Essar Energy: Nomura lowers target price from 180p to 170p, while leaving its buy recommendation unaltered.

Activmoto - 11 Sep 2013 20:37 - 97 of 101

I have a change of view on Essar and I think it due a drop from here. Today's close below 136.7 confirms yesterdays start of a correction.

jimmy b - 16 Feb 2014 19:34 - 98 of 101

Interesting article on the front page of Sunday Times Business today ,sorry can't get the online version.

jimmy b - 16 Feb 2014 19:41 - 99 of 101

EDIT here it is .........

The Sunday Times

Essar takeover a blow to City credibility
Danny Fortson
Last updated February 16 2014

Indian billionaires line up Kremlin bank to back cheap offer for power giant, leaving London investors out of pocket

INVESTORS will this week receive another mauling from a disastrous foreign float when a billionaire Indian family offers to buy back its company on the cheap.

The Ruias, one of India’s most prominent business dynasties, are this weekend putting the final touches to a takeover bid for Essar Energy, the power company they floated in 2010. It is thought the deal will be pitched at no more than 75p a share, a fraction of the 420p paid by investors who bought in four years ago.

The Essar collapse is another blow to the reputation of the London market, which welcomed the listing of foreign oil, gas and mining companies but has seen some investors badly burnt.
Last year the founders of ENRC, a Kazakh miner beset by corruption allegations and boardroom bust-ups, took the company private at less than half the float price.
It is understood the offer from the Ruia family could come in the next few days. VTB, the Russian state-controlled bank, has been lined up to finance the bid. The company is expected to create an independent committee led by Philip Aiken, the senior independent director, to assess any offer.
Essar, which operates coalmines and power plants in India, employs 1,500 people at the Stanlow oil refinery in Cheshire.
Investors could have an even worse experience than with ENRC. The business admitted on Friday that Essar Global Fund, the family’s holding company, which has a 78% stake, was considering making an offer at a “modest premium” to Thursday’s closing price of 60p for the rest of the shares.

The family will need to raise about £500m to pay for the remaining stock and to buy out a convertible bond.
It is unclear whether the offer would be made in the form of a scheme of arrangement, which would require 75% approval from non-family shareholders, or a straightforward takeover bid requiring approval from only half of the shareholders. The Ruia family will be barred from voting its 78% stake, but investors are still likely to sell out.

When it floated, Essar was the latest in a series of foreign groups that enticed investors with the opportunity to tap into the soaring economic growth of the develop- ing world. It quickly joined the FTSE 100 roster of the biggest public companies.
Essar’s share price hit a high of 589p in 2010 but since then has slumped nearly 90%. The company dropped out of the FTSE 100 in 2012 as it battled with delays to plant openings and Indian regulators’ demands on mines. It was then hit with demands for hundreds of millions in back taxes.

Slower-than-expected growth in the Indian economy further hindered the company, and trading in the stock fell to a trickle as institutions shunned it.
The brothers Shashi and Ravi Ruia started the mother company as a shipping and construction operator in 1969 and transformed it over four decades into a conglomerate spanning telecoms, oil, ports and steel.
They employ 75,000 people. Shashi’s son Prashant is the chairman of Essar Energy.

Bankers at VTB and Barclays were this weekend working to hammer out the details of a bid. It is thought that JP Morgan is advising the company.

Essar declined to comment.

HARRYCAT - 07 Mar 2014 08:57 - 100 of 101

From FT "India’s billionaire Ruia family are putting the final touches to an improved offer for Essar Energy as they push ahead with plans to take the company back into private ownership.

The Ruias, whose initial buyout bid of 70p per share was rejected by minority shareholders last week for undervaluing the company, are working with advisers including Barclays, Russia’s VTB Bank and Clifford Chance, the law firm, on a higher offer, according to sources familiar with the plans."
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