Essar Energy Plc is an Indian-focused energy company with assets in the existing power and oil and gas businesses. Headquartered in Port Louis, Mauritius and subsidiary of Essar Group, the firm has interests in both the power generation and petroleum industries. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
Established in 1998 as a wholly owned business unit of the Essar Group conglomerate,2 the firm was partly floated on the London Stock Exchange in April 2010, marking the exchange's largest initial public offering since December 2007.3 The company was added to the FTSE 100 Index at the subsequent quarterly review. Essar Group retains an approximate 76% stake in Essar Energy.4 The lead underwriters to the Initial Public Offering were JPMorgan Chase and Deutsche Bank. The primary offering raised £1.3bn. Ravi Ruia, the Chairman, and Sanjay Mehta, a senior board member of Essar Global Limited, were identified in an Economic Times of India article as instrumental in the listing.5
Essar Energy has an installed power generation capacity of 1,220MW across four plants.6 75% of the firm's electricity output is supplied to other Essar companies which have facilities adjacent to the plants. The company intends to increase its generation capacity to 11,470MW using funds raised from its initial public offering.7
The firm's oil and gas operations are carried out through its 86%-owned subsidiary8 Essar Oil Limited, which is listed on the National Stock Exchange of India and the Bombay Stock Exchange. Essar Oil owns and operates a petroleum refinery in Vadinar, India's second largest, which has a capacity of 18 million metric tons per annum.9 It also owns 50% of Kenya Petroleum Refineries Limited (the remainder being held by the Kenyan government), which operates the Mombasa Refinery.
The firm markets refined petroleum products under the Essar brand, both wholesale and through its network of around 1,381 franchised fuel stations.
Essar Oil holds both onshore and offshore petroleum exploration and production rights within India, as well as rights to a coalbed methane block. The firm also holds exploration and production interests in Nigeria, Vietnam, Australia, Indonesia, and Madagascar. Its total reserves amount to 2 Mbbl (320,000 m3) equivalent of 2P (proved plus probable) resources, 148 Mbbl (23,500,000 m3) equivalent in contingent resources and 1,012 Mbbl (160,900,000 m3) equivalent in prospective resources. In June 2012 Essar energy received the final forest approval for developing a coal mine in Indonesia.10