Essar Energy,19 others ink $1.5-bn deals with Chinese cos

PetroChina would buy fuel from Essar for seven to 10 years.

Written by PTI | Mumbai | Published:May 21, 2013 10:40 pm

Domestic and Chinese firms signed as many as 20 trade and trade finance pacts here today totalling USD 1.5 billion with Essar Energy topping the deal sheet with a USD 1-billion loan agreement with China Development Bank and PetroChina International.

Of the 20 MoUs,as many as 18 are purchasing raw/finished materials between the partners,while one is for a USD 72.5 million financing agreement signed between Anil Aggarwal promoted SDP Services and the China Development Bank Corporation,visiting Chinese commerce minister Gao Hucheng said here this evening at the event presided over his premier Li Keqiang.

The biggest deal is between Essar Energy and China Development Bank and PetroChina International Co for a USD 1 billion loan for the oil major,according to the MoU sheet provided out by the event organiser,CII.

The loan pact with Chinese banks will be backed by the supply of refined products from Essar Oil’s Vadinar refinery in Gujarat. This will be a kind of export advance which the company will use to cut its debt.

Yesterday Essar Oil had told stock exchanges that it would be inking a deal with the Chinese for loans as “part of our initiative to dollarize our debt,we have been in

discussion with several international banks,including Chinese banks. The CDB loan is part of that conversation.”

Accordingly,PetroChina would buy fuel from Essar for seven to 10 years.

The other deals include a USD 100 million agreement to purchase frozen seafood from Sanchita Marine Products and Chinalight Resources Import & Export Corporation.

Reliance Industries signed two agreement with two Chinese companies to sell salt and other materials worth USD 77 million to China Slat Import & Export Co and to Sumstar Group.

Lupin Pharma signed an agreement to sell active pharmaceutical ingredients worth USD 17 million to China Meheco Corporation.

The Cotton Textiles Export Promotion Council a deal of USD 15 million to sell cotton yarn and fabric to CHTG China Texmatech Co.

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