Essar Ports has sought the approval of its shareholders to participate in the development of a coal terminal at the Beira port in Mozambique. The terminal, which proposes to have a capacity of 10 million tonnes per annum (mtpa), is to be developed through a joint venture at an initial estimated cost of about $25 million (about Rs 150 crore), it is learnt.

The investment would also provide a corporate guarantee of up to $10 million on behalf of the joint venture, the company said in a notice to its shareholders whose approval has been sought through postal ballot.

New Coal Terminal Beira (NCTB) is a joint venture between Essar Ports (70 per cent stake) and the Port and Rail Authority of Mozambique (known as Caminhos de Ferro de Mocambique), specially created to develop a multi-user coal terminal at the Beira Port with capacity of 10 mtpa. There is scope to increase the capacity by a further 10 mt in case of cargo availability.

NCTB has already secured a letter of intent from Mozambique's Ministry of Transport and Communications wherein it has been granted a long-term concession for the development of the terminal on DBOOT (design, build, own, operate and transfer) basis.