GMR's Andhra power unit seen onstream by July

The GMR group-promoted Rs 1,130 crore Vemagiri power plant in Andhra Pradesh would commence commercial operations in two months.

The natural gas-fired combined cycle power plant with a gross capacity of 388.5 MW and a contracted capacity of 370MW is located near Rajahmundry in the east Godavari district.

"Commercial operations of this plant has been delayed owing to non availability of gas. As GAIL India has agreed to arrange required gas for the plant, the plant will begin by July," a senior company executive said.

The plant has 15-year fuel supply contract with GAIL. He said the trial operations were successful but there was no alternative arrangement for a guaranteed supply of fuel. "However, gas availability would not be a problem after 2008," industry sources said.

The plant was developed by GMR Energy wholly owned subsidiary Vemagiri Power Generation (VPGL). The project achieved financial closure in December 2003.

Recently, VPGL entered into a long term assured parts supply agreement with GE Energy Parts Inc and a long term maintenance contract with GE International Inc for maintenance of gas and steam turbines.

The GMR group is also operating in a 220 mw naphtha-fired power plant in Mangalore and 200MW liquid fuel oil-fired power plant in Chennai.

In addition, GMR has won right to develop a 140MW hydroelectric power plant on the river Alakananda in the Chamoli district in Uttaranchal. The estimated cost of this plant is Rs 700 crore and the project is expected to completed in next eight to nine months.

Sources said in order to diversify its portfolio, the company is also targetting coal-based and hydroelectric power plants project.