Essar Oil makes maiden overseas acquisition
Friday, 18 January 2008, 01:40 IST
Printer Print Email Email
New Delhi: Indian petroleum company Essar Oil has made its first overseas acquisition in the refining sector in Kenya. "Essar Energy Overseas Ltd, a subsidiary of the company, has entered into an agreement to acquire 50 percent stake in Kenya Petroleum Refineries Ltd (KPRL), a four million metric tonnes per annum (MMTPA) refinery in Mombasa, Kenya," Essar Oil informed the Bombay Stock Exchange Tuesday. "The government of Kenya holds the remaining 50 percent of KPRL," the company said. "This, the first international acquisition by Essar in the refining sector, fits Essar's strategy of achieving refining capacity of one million barrels per day," the company said. "Essar will acquire the stake from the existing shareholders - Shell, Chevron and BR. Subject to certain conditions, the acquisition is expected to be completed in early 2008," the company said. According to Essar Oil, the Mombasa refinery is the only refinery in Eastern Africa. "It currently produces LPG, gasoline, diesel, kerosene and fuel oil and the refinery is planned to be upgraded by adding secondary units at a project cost of $400-450 million," it said. Essar Oil said KPRL's products are sold into the Kenyan market and exported to many neighbouring countries including Tanzania, Uganda, Burundi and Rwanda. "Demand for petroleum products in these markets is estimated at 5 million tonnes per annum," it said.
Source: IANS
siliconindia