Mercantile Ports & Logistics Ltd Progress Update (8531L)
24 April 2018 - 4:00PM
UK Regulatory
TIDMMPL
RNS Number : 8531L
Mercantile Ports & Logistics Ltd
24 April 2018
24 April 2018
Mercantile Ports & Logistics Limited
("MPL" or the "Company")
Progress Update
In its update in February, the Company stated that final
customs' approval was expected to be received shortly. Whilst
progress has been made in this regard and the Board considers
receipt of customs' clearance to be a formality, the Company
updates shareholders that this particular milestone has yet to be
achieved. The Company remains engaged with the relevant authorities
and, following the most recent contact, it has received guidance
that this matter is expected to be resolved in the coming weeks. A
further update will be provided on or before the Company's annual
results, expected to be released in mid-May 2018.
This delay has been frustrating but the Company can report that
significant progress has been made in other areas. In particular,
300 meters of jetty length has been completed in full and is ready
for use. In addition, civil construction works have been completed
on the dedicated 200 meter break bulk berth. The Directors are
confident that the break bulk berth will be ready to be used in
conjunction with the receipt of customs' approval. Work has also
continued on other infrastructure areas such as fencing, the weigh
bridge and office buildings.
On the commercial side, the Company is pleased to announce that
it has entered into an MOU with a US based, engineering logistics
company, which is bidding to decommission well head platforms in
India. The MOU is for this customer to use 100 meters of the jetty
(200 meters of quay length) and 15 acres of backup area, with this
land being dedicated to them for engineering purposes.
As at the 31st March, the Company had cash and undrawn banking
facilities of GBP22.4 million. The Company continues to manage its
resources in line with the timetable to operation. As a result of
the date of revenue receipts being later than anticipated, the
Company has, pending receipt of customs' clearance, reduced the
level of expansion activity on site, particularly in the expensive
workstream of land reclamation. That said, an additional 10 acres
of reclamation material is on site and being used for surcharging,
meaning that some 20 acres of reclamation material is on site, with
95 acres reclaimed. This is significantly more land than the circa
50 acres required to commence operations and generate revenue.
Reclamation work will, however, accelerate once again upon revenue
generation being achieved and this phasing does not impact upon the
Company's ability to commence operations at the Facility or on its
final configuration as a 200 acre, all weather, port and logistics
facility.
Much has been written about the growth in the Indian economy and
the directors believe that the prospects for the Facility have
continued to strengthen. In addition to the general economic
climate, there are specific initiatives that are expected to have a
beneficial impact on the Company. In particular, the pipeline that
runs across the mouth of Karanja creek and which currently limits
the draft capacity of vessels using the port, is proposed to be
moved by the Government. The Inland Waterway Authority has adopted
the Dharamtar and Karanja Creeks for development as part of the
Government of India's Sagarmala project to, amongst other things,
boost the use of coastal shipping in the country. Once the pipeline
has been re-routed, which the Company would hope would be within
the next three to four years, the Company's facility will, after
additional dredging, be capable of receiving vessels with a draft
of up to 11 meters. The infrastructure at the Facility, including
the strength of the jetty, has been designed with this possibility
in mind. However, the directors are delighted that this initiative
has commenced much sooner than they had anticipated.
Nikhil Gandhi said "We are now very close to receiving our first
paying vessel. We are proud to be associated with the Sagarmala
vision of the Government of India and look forward to both
supporting it as well as capitalising on the immense opportunities
it presents. I would like to thank the Maharashtra Maritme Board
for their continued support."
Enquiries:
MPL Pavan Bakhshi/Jay Mehta
C/O Redleaf Communications
+44 (0)20 3757 6880
Cenkos Securities plc Stephen Keys/Camilla Hume
+44 (0)20 7397 8900
Redleaf PR Charlie Geller/Fiona Norman
(Financial PR) +44 (0)20 3757 6880
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCFXLLLVZFLBBF
(END) Dow Jones Newswires
April 24, 2018 02:00 ET (06:00 GMT)
Mercantile Ports & Logis... (LSE:MPL)
Historical Stock Chart
From Apr 2024 to May 2024
Mercantile Ports & Logis... (LSE:MPL)
Historical Stock Chart
From May 2023 to May 2024