JSW Infrastructure Eyes Ammonia, Green Hydrogen Facilities for Ports

22 Jul 2024 , 12:41 PM

In an effort to expand into this prospective growth industry, JSW Infrastructure Ltd., the second-largest port operator in India, is thinking of constructing green hydrogen and ammonia facilities at its ports.

This is a new business that is starting to emerge. According to ET, Arun Maheshwari, joint managing director, told a source, “We have been thinking about and looking into opportunities in this sector.”

“Entries in the green hydrogen and ammonia segment have approached us, and we are considering the possibility of joining this market as well,” he continued.

When asked when such facilities might be established, Maheshwari responded that they would be long-term, capital-intensive projects requiring appropriate acreage, a strong backend, and a prominent port location. Thankfully, prospective gamers find our new and current port sites to be attractive. Nevertheless, we do not yet have a project timeline in place.

In an effort to establish India as a significant exporter of green hydrogen, the Ministry of Ports, Shipping, and Waterways (MoPSW) earlier this year named three important ports—Kandla, Paradip, and Tuticorin—as potential export centers for methanol, ammonia, and green hydrogen over the course of the next seven years.

Adani Ports & SEZ recently declared that its Vizhinjam Port will serve as a global hub for bunkering, offering environmentally friendly fuels like ammonia and hydrogen.

The sister company of JSW Infra, JSW Energy, is likewise looking at acquisitions in the green energy space.

Maheshwari stated, “The industry guidance is around 4% to 4.5%, but our guidance is 10% to 12%,” in reference to the total development of the company.

He emphasized that improving last-mile connectivity and offering reliable solutions to guarantee client loyalty are JSW Infra’s main priorities.

Maheshwari talked about the strategic significance of different terminals while addressing development drivers. Paradip is a major center for iron ore and a port of choice for both coal and iron ore. Ennore Terminal’s closeness to the hinterland has growth opportunities. The cargo handling capabilities of the New Mangalore terminal set it apart, and the Jaigarh port has enormous growth potential as well. In addition, Jaigarh lacked rail connectivity until the acquisition of PNP Port.

Speaking further about the client mix for cargo, he mentioned that the percentage of third-party business, which was 6% in 2019, rose to 50% in the quarter that concluded in June. One of our anchor customers temporarily shut down, which is what caused this increase. We anticipate that 55% of the year’s third-party share will come from anchor clients, or about 45%. The distribution is anticipated to be sustainable, with a 50:50 ratio as the ultimate objective.

Maheshwari responded that the business anticipates the Tuticorin terminal to be finished in 18 to 24 months and the JNPA terminal to be operating by February or March 2025 when questioned about capacity enhancement from its recent acquisitions.

The company also hopes to finish construction on its 2 million tonnes per year LPG terminal in Jaigarh, which was a major goal of its first public offering. These stand in for the three anticipated increases in capacity.

According to him, the present utilization rate is 63-64%, and it is anticipated to rise to 66%. In two years, the estimated utilisation rate for 181.5 million tons is approximately 66%, assuming no new assets or capabilities are added.

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