Archean Chemical Industries Pvt Ltd, part of the Chennai-based $550-million Archean Group, has secured financial closure for its proposed Rs 850-crore marine chemicals project in Gujarat. A consortium of banks led by Bank of India, with Allahabad Bank, Bank of Baroda, Canara Bank, Punjab National Bank and Union Bank of India being the other banks in the consortium, has agreed to extend a debt of Rs 565 crore. SBI Capital Markets is the sole financial advisor and debt arranger. Green potash mission The company, in the first phase, is putting up a facility to manufacture one lakh tonnes of sulphate of potash (SOP), which is used in specialised fertilisers. SOP is the favoured fertiliser for non-herbaceous crops that are sensitive to chloride. In India, this chemical is mainly used by tobacco farmers, said Mr S.M. Sundaram, Chief Operating Officer of the Archean group. As the manufacturing process does not involve any organic chemicals, it will be a part of the ‘Green Potash Mission' of the Government of India, and will be eligible for Government subsidy too. The facility will come up with technical know-how from K+S of Germany, he said. Besides SOP, the facility will also produce industrial salt bromine, magnesium oxide and gypsum in the process. The plant is expected to start commercial production by the first quarter of 2012-13. Mr Sundaram said there is a ready demand for the product in both domestic and foreign markets. According to him, the domestic demand for the product now stands at 50,000 tonnes a year, which is currently met through imports (mostly from Germany). And the market price is around $1,000 a tonne (excluding 5 per cent import duty). The current global demand stands at five to six million tonnes. India being the second largest producer of speciality crops such as fruits and vegetables, the Archean feels that the demand growth will be significant in the ensuing years. The plant will provide flexibility to expand capacity up to four million tonnes a year in stages, which will involve an additional capital outlay of Rs 600 crore. “On completion of this phase, the turnover will be approximately Rs 1,500 crore,” he said.

GML has added another Bulk carrier in its line up. The new addition to the fleet is a geared Handymax carrier of 52383 T DWT built by Okean Ukraine. The vessel, formerly Capt George II is expected to start commercial operations by the end of this month. This acquisition raises the total number of Bulk carriers in the GML fleet to 8. After the acquisition GML now has a total fleet capacity of 370961 DWT constituting 1 Panamax, 3 Handymax and 4 Handysize vessels.

Hindustan Shipyard Limited has floated its second 53,000 DWT Diamond series bulk carrier in the covered building dock in the presence of Secretary (Defence Production) R.K. Singh on Monday evening.

M.V. Good Pride, the first biggest 53,000 DWT Diamond series bulk carrier also went for final sea trials. It is getting ready for formal delivery to Good Earth Maritime Ltd. of Chennai.

"HSL is constructing largest size bulk carriers in the country for our Indian ship owners," a HSL release said on Tuesday.

HSL Chairman and Managing Director Cmde. Naresh Kumar, Director (Finance and Commercial) Rakesh Mahajan, Senior General Manager Cdr.R.B. Rao and representatives from Hindustan Shipyard Officers' Association, Hindustan Shipyard Staff and Workers' Union and others were present.

HSL will lay the keel for the third vessel of 53,000 Diamond series of vessels by General Manager (EKM production) M.M.H. Khadari in a day or two.

The Hindustan Shipyard Limited on Monday delivered the last in the series of four trader ships – merchant vessel Good Pilgrims, a double hull 30,000 DWT bulk carrier to Chennai-based Goodearth Maritime Limited (GML).

National Shipping Board Chairman and Member on the Board of HSL P.V.K. Mohan delivered the ship at a simple ceremony on board m.v. Good Pilgrims to GML Managing Director S. Madhan. HSL Chairman and Managing Director Naresh Kumar later exchanged the protocol with the owners.

This was the 150th vessel built and delivered by HSL since its inception. The ship was built as per the standards specified by the Indian Register of Shipping (IRS) and American Bureau of Shipping (ABS).The ship 178.7 metres long, 28 m wide and 14 m deep and designed to run at a speed of 14.30 knots.

In his speech, Cmde. Naresh Kumar described the occasion as a red letter day in the history of the yard and complimented the HSL employees for delivering the vessel on time.

Capt. Mohan, who was the chief guest, was happy to note the progress made by HSL in building large ships like 30,000 and 53,000 DWT bulk carriers.

The first phase of group’s sulfate of potash plant, producing around 100,000 tonne and spread over 60,000 acres, will be finished close to the end of 2010 at a cost of Rs.600 crore.

By Anupama Chandrasekaran

Chennai : Archean group, a Chennai-based conglomerate with interests in minerals, industrial chemicals and shipping, plans to complete its Rs1,200 crore Gujarat plant-the largest in the country to manufacture fertilizer input sulfate of potash-by 2012.

It is also likely to take its shipping business public.

"We may take the shipping company public when the market improves," S.M. Sundaram, Archean’s chief financial officer, said. The family-run group, which claims to be the second largest landowner in Gujarat, will complete the 300,000 tonne capacity fertilizer input unit by 2012. Every year, Indian fertilizer companies import an estimated 3.3 million tonnes (mt) of potassium-based inputs.

"India has no captive production of potassium and India has to import all of its requirements," said Satish Mishra, an analyst with PINC Research.

He added that the government had decreased prices of potassiumbased fertilizers last year by around 25% to encourage its use. While potassium chloride is a more commonly used plant nutrient, usage of sulfate of potash, touted to be good for crops such as tobacco and coffee, is gradually increasing, Mishra said. The first phase of Archean group’s sulfate of potash plant, producing around 100,000 tonne and spread over 60,000 acres, will be finished close to the end of 2010 at a cost of Rs.600 crore.

The second and final phase, with an investment of another Rs.600 crore, will be completed by mid 2012 and will cover an extra 40,000 acres.

Archean group, established in 1984, has seen revenue for its India business at least double to Rs.850 crore in 2008 from Rs.400 crore five years ago. Including revenues from a recent acquisition in West African country Senegal and other overseas businesses, its sales in 2008 stood at Rs.3,000 crore.

Profits for its India-based businesses during the same five-year period have quadrupled to Rs.125 crore from Rs.35 crore.

The group’s first venture in the 1980s was in granite sales via its unit Archean Granites Pvt. Ltd. It later got into iron ore with its core minerals unit and then entered industrial salt business by setting up Jakhau Salt Co. Pvt. Ltd.

The company’s newest venture, its shipping business, Goodearth Maritime Ltd, contributed almost half of its India profits in 2008. In 2004-05, it placed an order with Visakhapatnam-based shipbuilders Hindustan Shipyard Ltd for 10 ships worth at least Rs.1,200 crore.

Archean group has received four of the 10 ships ordered. But profits for the group’s logistics and dry-bulk carrier business, Goodearth Maritime, were cut to half last year amid the global economic downturn.

By Soman Baby

Manama : A top Bahrain business group has formed a joint venture with an Indian industrial house to set up a $100 million company for the manufacture of aluminium fluoride. The Pearl Industrial Chemicals Company (PIC) has been established by Bahrain's EBH Holding and India's Archean Group of Companies.

The new company will be chaired by Shaikh Ebrahim bin Hamad Al Khalifa.

PIC will be located at South Alba Industrial Estate and will start production in two years.

The company will create about 150 jobs, of which 100 will go to Bahrainis, said chief executive officer C George John.

The environment-friendly plant will be built with the most modern technology and will provide direct employment to about 150 technical and non-technical personnel, he told a Press conference at the Regency Inter-Continental Bahrain.

"Bahrainis will be trained on site and at suitable locations which will enable the local manpower to absorb the most modern technology," he noted.

"The project will also provide indirect employment to many others".

"We are grateful to the Bahrain government, especially the Industry and Commerce Ministry, which has allocated about 100,000 sqm of land for the project, with amenities like power, gas and water including all clearances."

The plant, when fully operational, is expected to produce 60,000 metric tonnes of aluminium fluoride, which is a critical chemical ingredient in the aluminium smelting process, said Chennai-based Archean Group executive director C G Sethuram.

"This chemical is currently being imported by Alba and other smelters in the region like Sohar Aluminium, Oman," he added.

"Out of 30,000 tonnes to be produced by the Bahrain plant in the first phase, 18,000 tonnes will be bought by Alba.

"The GCC countries' total requirement for aluminium fluoride is 140,000 tonnes annually."

Financial consultant Jassim Abdulaal, of Grant Thornton, said PIC had been on the lookout throughout the world for a right technology company suitable to the region.

"The efforts met with success by locating such an organisation from India with whom a joint venture has been finalised," he added.

"The Archean Group has multi-national operations in the field of salt, mining, shipping, construction materials and industrial chemicals covering three continents.

"The group decided to own a majority shareholding - 76pc - in the venture through one of their group companies and will manage the establishment of the project and business operations including training of personnel."

One of the key raw materials, sulphur, is locally available and the company has been assured of uninterrupted supply of this material from Bapco, said Mr Sethuram. Other raw materials will be imported.

Aluminium fluoride when produced in Bahrain will give much needed support to the aluminium smelting industry which is flourishing in the GCC countries, said Archean chief financial officer S M Sundaram.

"Most of world's aluminium smelting projects are either already based in GCC countries, like Bahrain, the UAE and Oman, or new smelters are underway in countries like Qatar and Saudi Arabia.

Apart from aluminium fluoride the plant will produce co-products like gypsum which will be supplied to the cement industry in GCC countries, said Mr Sethuram.

"Satellite manufacturing units like gypsum board for the construction industry can be set up in the neighbourhood using this material thereby generating ancillary employment opportunities in the future," he said.

"PIC will help smelters like Alba to replace imports totally in the coming years.
soman@gdn.com.bh

PIC will be located at the South Alba Industrial Estate and will start production in two years

PTI

Dubai : India's Archean group of companies has formed a joint venture with Bahrain's EBH Holdings to establish Pearl Industrial Chemicals company (PIC), a $100 million firm for manufacturing aluminium fluoride.

PIC will be located at the South Alba Industrial Estate and will start production in two years. The environment-friendly plant is set to hire about 150 technical and non-technical personnel, around 100 of whom will be Bahraini nationals, according to PIC chief executive officer C.George John.

Once fully operational, the plant is expected to produce 60,000 metric tonnes of aluminium fluoride annually, which is a critical chemical ingredient in the aluminium-smelting process, said Chennai-based Archean group executive director C.G. Sethuram.

"This chemical is currently being imported by Alba and other smelters in the region like Sohar Aluminium, Oman. Of the 30,000 tonnes to be produced by the Bahrain plant in the first phase, 18,000 tonnes will be bought by Alba," he said.

The Gulf Co-ordination Council countries' aluminium fluoride requirement is 140,000 tonnes annually. The Archean group has multinational operations in the field of salt, mining, shipping, construction materials and industrial chemicals, covering three continents.

One of the key raw materials, sulphur, is locally available and the company has been assured of its uninterrupted supply while other raw materials will be imported.

Apart from aluminium fluoride, the plant will produce co-products like gypsum, which will be supplied to cement units in GCC countries. PIC will help smelters like Alba to replace imports totally in the coming years.

Archean has taken a majority stake in ICS - Senegal, 4th largest producer of Phosphoric acid in the world.