Tuesday, April 26, 2011

Cals Refineries: Latest Status & Photos of Bayernoil Refinery, Ingolstadt

StockExplain brings you an exclusive, latest status update and photo-shoot of Bayernoil Refinery of Ingolstadt, Bavaria, Germany, that Cals Refineries (BSE: 526652 / CALSREF) of India bought through Lohrmann International. The photo-shoot was done around three weeks back, on April 4th, 2011.

The future of this refinery will be decided as per the outcome of a court case and arbitration going on in New Delhi, India, between Cals Refineries and Lohrmann International.

Also Read: Cals Refineries Latest News on – SEBI, CCEA, FIPB, Hardt, EPCC, Bayernoil, West Bengal, SHP

This refinery has been partly dismantled and these 14 photos show whatever is not dismantled at the original site at Ingolstadt. As the photos reveal, this nitrogen-preserved refinery is in reasonably good shape. (Story continues below, after slideshow)

(Photos copyright: thomas-mies.com) (Click on the slideshow images to view original, large-sized photographs).

If the outcome of the litigation is in favour of Cals Refineries, this refinery will be fully dismantled, packed in over 3000 containers, and shipped to Haldia, West Bengal, India, where it will be re-erected by Cals Refineries, to create the first phase of one of India's largest refinery projects.

This status update with photos come from inputs provided by an architect and professional photographer based in Germany, who recently had a guided tour of the Bayernoil Refinery.

The dismantling work is still going on. Confirming what StockExplain reported earlier, in areas that have been dismantled, new developments like Audi SportPark & Business Park have already come up. Now, the city of Ingolstadt is bullish on re-developing the remaining areas of the refinery, due to acute land shortage, and as such, the dismantling is set to gather pace.

Cals Refineries had recently tied up with Vienna based Hardt Group, an alternative investment firm, to get additional refining units. Under a plant-and-machinery-against-equity deal, Cals is acquiring from Hardt, the Atas Refinery of Turkey and Cenco Refinery of USA. The deal is valued at nearly Rs. 1500 crore.

For this, the BSE and Luxemberg listed Cals Refineries is planning a further GDR Issue, for which it is seeking shareholder approval via a postal ballot. But the deal need to be cleared also by India's Foreign Investment Promotion Board (FIPB). Cals' FIPB application was taken up in the FIPB meeting held on April 20th.

Noted corporate law firm, Shearman & Sterling, which has a track-record in large petroleum sector acquisitions, is representing Cals Refineries Ltd in the acquisition of oil refinery assets from Hardt Group.

Earlier Cals Refineries had tied up with Kuwait based conglomerate Kharafi Group's investment arm for an equity participation of around Rs. 675 crore. But the deal has not materialized even after six months of announcement, and it is not clear whether the recent demise of Kharafi Group's President Nasser Al-Kharafi would have any kind of impact on the deal.

Most of Cals Refineries' original equity of around Rs. 800 crore came from a GDR Issue. More than 65% of these GDRs were later converted to underlying Indian shares. The promoter group, Spice Energy, holds 16.09% of the total equity, including their holdings in GDR.

Italy's Saipem, a subsidiary of Eni SpA, has been entrusted by Cals recently to prepare the feasibility report, and Saipem stands to gain the EPCC contract for the refinery if the feasibility report satisfies concerned parties like Cals, Hardt, Kharafi, lending institutions etc. 

After anticipated milestones like the FIPB approval, GDR subscription by Hardt, the Lohrmann settlement, and the Kharafi infusion by way of another GDR, Cals Refineries need to tie-up the debt part of the project so as to complete financial closure (FC), which will be a tipping point for the long awaited project in the country's petroleum sector.

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