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Future Plans

Future Plans

Transformation at ESL

The transformation process has been directed to serve customers better. The company's services are expected to cover a larger footprint. This will enable the company to offer a wider and deeper range of services. The global shipping industry is being restructured. In keeping with the changing environment, ESL has embarked on a number of initiatives to reinvent the organisation. Global oil refiners, who earlier also ran ships to transport their crude oil and products, are focusing more on refining and marketing than before.

To raise refining margins, a number of these oil refiners have begun to outsource a number of ancillary functions. Shipping and storage are two of them. This change has created attractive opportunities for shipping companies. Over the foreseeable future, most are expected to evolve from their traditional fleet operations role to that of sea logistics management.

ESL is at the forefront of this transformation. Over the foreseeable future, the company expects to evolve into a service provider customised to the specific requirements of its users and their respective industries. The transformation process will also enhance the franchise and brand value of ESL. The company's services are expected to cover a larger footprint enabling the company to offer wider and deeper range of services. This initiative will also build and enhance the branding of ESLs services - one of an integrated logistics player in the international market.

Rig to refinery - and beyond

ESLs value chain of 'rig to refinery and beyond' is expected to grow the business and add to margins. When more petroleum refineries are commissioned in India over the foreseeable future, companies like ESL will be required to import crude and export end products in increased quantities. The company also expects to provide profitable integrated coastal services to address non-pipeline transport requirements. ESLs proposed service is expected to cover the entire value chain from oil terminals to international logistics, making it unique in the global market.

Crude oil Terminalling facility

ESL expects to add value to its earnings through the development of the Vadinar Terminalling facility. This facility will possess a crude oil tankage capacity of 5.79 million barrels and product intermediate tankage capacity of 6.81 million barrels. ESL, through its subsidiary, is building a crude oil reception, storage and refined product evacuation facility with an annual throughput capacity of 200 million barrels. This investment is expected to be synergic: the size of the Terminalling facility will cater to large tonnage crude vessels that can be turned around in the shortest possible time. A strong service orientation is expected to attract traffic to the Terminalling facility, resulting in attractive earnings for ESL.

Crude oil storage

Over the foreseeable future, the Indian oil and petroleum industry is expected to be significantly deregulated. This scenario is likely to create a number of opportunities for the company. ESL expects to be well positioned in this business since refiners and traders may be required to store oil and provide inventory-holding services to its customers. This service is expected to extend the company's value chain.

Integrated Coastal Transport

ESL has identified Integrated Coastal Transport as a profitable and growing area. The company's presence in this segment is dictated by a greater awareness among Indian and Asian manufacturers to cut inventories and costs. ESLs integrated coastal transport service is expected to assist steel, cement and fertiliser companies, among others, to achieve this. The company expects to provide complete logistics solutions to help them emerge competitive and respond faster to changes in the market place. The result of these strategies is expected to help ESL emerge as a ship owner, operator and a multi-modal (land or sea) transport operator with an emphasis on coastal trade.