High gas prices send Essar Energy shares south

Shares in Essar Energy are trading down, despite the company having reported a 'solid' performance in the three months to 30 September.

Financial market analysis and opinion for the UK investment industry

Financial market analysis and opinion for the UK investment industry


Shares in Essar Energy are trading down, despite the company having reported a ‘solid’ performance in the three months to 30 September.

Shares in Essar Energy are trading down, despite the company having reported a ‘solid’ performance in the three months to 30 September.

The India-focused energy company saw its price drop 9.30p to 302.80p at 9.48am, a fall of 2.98 per cent.

During the nine months to 30 September, the group’s total generation of power was down 4 per cent at 4,848 megawatt hours (MWh), compared with 4,956 MWh for the same period last year.

In a statement, Essar said, ‘The reduction in generation was primarily due to lower output at our Hazira and Bhander power stations in Gujarat as a result of high gas prices, resulting in a higher generation cost, impacting demand.’

The total generation of power for the quarter was up compared with the corresponding period in 2010, to 1,553 MWh from 1,498 MWh.

Essar’s flagship plant, the Vadinar refinery in Gujarat, achieved a throughput of 3.03 million metric tonnes (MMT) compared with 3.69 MMT for the same period last year, an 18 per cent reduction.

The firm said this was due to 13 days of a planned 35-day closure of the plant falling in the period.

The Vadinar refinery is India’s second largest private sector oil refinery with throughput capacity of 14.7 MMT per annum.

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