ONGC to set up wind farm in Saurashtra

Petroleum major Oil and Natural Gas Corporation Ltd (ONGC) is set to foray into wind power generation. It has appointed a consultant to finalise the setting up of a 150 MW wind farm in Saurashtra.

ONGC, which signed a memorandum of understanding (MoU) with Gujarat Industrial Development Corporation (GIDC), a Government of Gujarat enterprise, to setup a Special Economic Zone (SEZ) at Dahej in Bharuch district last November, is now looking for a third equity partner for the project. A special purpose vehicle (SPV), Dahej SEZ Ltd, has already been formed to set up the zone.

Subir Raha, Chairman of ONGC, said most of ONGC's wells in Gujarat are on artificial lifts, whose movements get interrupted because of erratic power supply.

"If the artificial lift movement is interrupted, it takes a lot of time to reach optimum production, which results in losses to the company. Also, it is not possible to put manpower at each artificial well round the clock. The power generated from the proposed wind farm will be used to ensure uninterrupted power supply to its artificial lifts thus even in case of a power failure, the movements of the artificial lifts working at ONGC's wells will not be hampered," he said.

Noting that the plant which would be more for captive consumption, Raha said the wind farm is expected to be operationally commissioned by 2007.

"Once the survey is over by the consultancy, we would be able to talk on the size of investment though initially it seems to be around Rs 600 crore with sops for wind farm in the country. There are only two wind corridors in the country for wind farm, one of which is in Tamil Nadu and the other one is in Saurashtra and we are trying to finalise the area in Saurashtra where ONGC would be setting up the plant," Raha said.

Sharing development for the proposed SEZ in Dahej, which would be developed by ONGC along with GIDC, the Chairman said: "ONGC does not have any expertise in setting up SEZ and neither GIDC has any such specialisation. We are talking to various prospective partners which are known for specialisation in such development for the Zone and we hope to close the deal by end of this year following which EPC contract for the SEZ would be awarded."

ONGC will also setup a C-2 (methane) extraction plant in Dahej within the SEZ for which the Board has already approved an investment of Rs 900 crore in the first phase of the Project. "We will also setup a C-3 (propane) extraction plant in the SEZ and for both the C-2/C-3 projects, Corporation may have to invest over Rs 2000 crore," he said.

ONGC holds 26 percent stake in the Dahej SEZ Limited.

Interestingly, the Ahmedabad-based Adani Group had early this year responded to an invitation of Espression of Interest (EoI) called by GIDC for a third-party developer for the proposed Dahej SEZ project.

The Group is presently setting up a huge SEZ near its Mundra Port in Kutch district. However, Raha denied to share detail of any of the companies with which Dahej SEZ has been negotiating for being the third partner.