Portfolio

Diversified across core economic sectors

United Kingdom

2011

Active

Essar Oil UK is a leading UK-focused downstream energy company whose main asset is the Stanlow Manufacturing Complex, one of the most advanced refineries in Europe and situated close to the major cities of Liverpool and Manchester.

Essar has invested over $1 billion since acquiring Stanlow in 2011, when it became the first Indian company to buy and operate a UK-based refinery.   The major improvement initiatives delivered under Essar ownership has turned the company around and built a highly profitable and sustainable business, which has posted  EBITDA of over $300 million for each of the past four years.

Stanlow is a key strategic national asset, annually producing over 16% of the UK’s road transport fuels, while playing an important part in Britain’s petrochemical industry by providing key feedstocks.  Stanlow produces 3.5 billion litres of petrol, 4.9 billion litres of diesel and 2.3 billion litres of jet fuel per year.

Essar has an entrepreneurial approach, driven by the innovation and dedication of its workforce across all its business streams and supported by significant capital investment to further grow the business.  This ongoing commitment to the UK’s energy sector was underlined in 2018 with the delivery of the largest ever maintenance and re-lifing turnaround at Stanlow to further improve reliability and safety, together with the completion of a major optimisation project to increase throughput (from 68 to 75 million barrels per year) and the production of high value products.

Essar is a major supplier in the North West and beyond, with customers including most of the major retail brands operated by international oil companies and supermarkets, Manchester and Liverpool airports, leading commercial airlines and the region’s trains and buses.  Essar is the lowest cost supplier into the UK’s North West region and is highly competitive in supplying adjacent markets.

In 2019, the company acquired a number of assets from the multi-national BP, ensuring greater control over product evacuation and logistics infrastructure, helping to further expand our supply envelope in a very competitive UK Midlands region and underpin growth ambitions in the UK.  These included an equity stake of 11.5 percent in the UKOP pipeline, a 45% stake in a contractual joint venture with Shell, which runs the Kingsbury Terminal and a 100% interest in the Northampton Terminal

Essar is a major regional employer, with over 900 highly trained and loyal staff, a similar number of contractors on site and a further 5,000 people employed through the extended supply chain.  We contribute an estimated £60 million each year to the local economy.

Over recent years, Essar has strategically broadened its downstream integration, with a highly successful and award-winning entry into the UK fuel retail market. With 70 Essar-branded UK retail sites already operational across England and Wales, we plan to grow this network to 400 retail sites over the next five years.

We have always been a significant player in the wholesale supply of Jet A-1 to major UK airports. We have also successfully entered the market for direct supply of aviation fuel, signing agreements with a number of leading international airlines. We continue to grow this sector of our business.

Over the coming decade, the Board is determined to transform the business to ensure its long term sustainability.  Looking further ahead, this will involve detailed planning to increase the production of bio-products, jet and petrochemicals, while using transformative technologies to make innovative use of excess gasoline molecules.  We will continue to invest in our people, processes and infrastructure to further improve our safety and environmental performance.

A key initiative – and central to our vision of becoming carbon neutral – is Essar’s anchor involvement in the HyNet low carbon hydrogen production unit, sited at Stanlow, and the associated carbon capture project utilising depleted gas fields in the Irish Sea.

India, Vietnam, Nigeria

1999

Active

Essar Exploration & Production Ltd Mauritius (EEPLM) is an early stage developer, focussed primarily on oil & gas exploration. Its global portfolio includes conventional acreages with a resource base of 3.4 billion barrels of oil equivalent, as well as unconventional hydrocarbon acreages that have a resource base of 15 TCF (2.5 bboe) of gas. It has invested $1.1 billion in various acreages across the world.

These investments include:

  • Our exploratory well in Vietnam offshore has encountered several intervals of hydrocarbon-bearing Upper Miocene clastic reservoirs with estimated net thickness of over 150 metres. Following approval from PVN, the well was announced as a Gas and Condensate discovery with a significant potential of additional hydrocarbon accumulation.
  • The Offshore OPL-226 block in Nigeria was awarded to Essar in March 2010. Essar holds 100% participating interest in the block through its subsidiary, Essar Exploration & Production Ltd., Nigeria (EEPLN) and is the Operator in this block. Essar completed 568 sq. km of 3D API seismic and has plans to complete one exploratory well as committed in the Minimum Work Programme.
  • Unconventional hydrocarbon acreages in India through its entity Essar Oil & Gas Expolartion and Production Limited (EOGEPL). EOGEPL is one of the largest exploration & production (E&P) companies in India primarily focussed on Unconventional Hydrocarbons (UHC), with a resource base of 15 TCF of UHC that is strategically located in key sedimentary basins across India. The company is a pioneer of UHC in the country, with about 25 years of experience in E&P of Coal Bed Methane (CBM). EOGEPL’s flagship Raniganj East CBM asset is not only India’s largest producing CBM asset but also has a prolific shale gas potential.

EEPLM is breaking new ground in the unconventional hydrocarbon space in India and has emerged as a pioneer in CBM development and production. It seeks to utilise this experience and expertise to explore, develop and commercialise its other unconventional acreages towards enhancing the country’s energy security. With an independently assessed shale gas resource base in India, it is also poised to become a pioneer in this emerging energy frontier.

India, Canada

1997

Essar Power is one of India’s largest private sector power producers with a capacity of  3,330 MW across five multi-fuel plants in three Indian states and one thermal power plant in Canada. Of this, the Company operates 2,400 MW as an Independent Power Producer (IPP) with plants in Madhya Pradesh and Gujarat. The remaining are Captive Power Plants (CPP) in Gujarat & Odisha. Essar Power has also invested in the transmission business and constructed a 465-km interstate transmission system which spans three Indian states.

Essar has invested about INR 32,000 crore in the power portfolio, which includes INR 12,000 crore of equity. The company aims to bring down leverage in its balance sheet from INR 20,000 crore currently to aboutINR 7,500 crore. The deleveraging efforts include the debt restructuring in the IPPs, which were affected by the cancellation of coal mines and unviable pricing of imported thermal coal. Essar Power is in discussions, which are now at an advanced stage, with its lenders to restructure all existing debts. This Company has put together a clear programme to address the challenges faced by the IPPs and is confident of overcoming them in the current year.

Power demand in India is increasing at a rate of 7% year-on-year and there are no new power generation capacities that are expected to be created in the near future. Essar Power, therefore, has an excellent opportunity to enter into new PPAs and utilise its entire generation capacity. The business is led by a strategy of stabilising existing operations, growing them and venturing into the renewables space.