500MW unit to be set up in Bhilai

The Bhilai Electric Supply Company, a joint venture between public sector National Thermal Power Corporation (NTPC) and Steel Authority of India Ltd (SAIL), plans to invest Rs 2,000 crore to set up a 500 Mw power station in Bhilai and will scout for partners to pick up equity in the project.

"We plan to invest around Rs 2,000 crore to set up a 500 Mw power station at Bhilai," NTPC chairman CP Jain said.

The company has appointed Black and Weich as consultants to draw up designs and update reports before starting construction work.

Jain said the project, to be funded on 70:30 debt-equity basis, would entail an equity component of Rs 600 crore besides a loan of Rs 1,400 crore.

The two public sector undertakings would restrict their equity exposure to around Rs 350 crore (Rs 175 crore each) and try to rope in institutional investors for the remainder, he added.

Construction work on the project was slated to begin by August 2004 with the project expected to be complete by early 2007, the National Thermal Power Corporation chairman said.

SAIL had earlier hived off its power plants into two joint ventures ""NTPC-SAIL Power Company, which runs two captive plants at Durgapur and Rourkela with a combined capacity of 240 Mw, while the Bhilai venture houses a 74 Mw plant. Both public sector undertakings are equal stake partners in the project.

The joint venture would start looking for partners only at a later stage, Jain said.

NTPC has set up several joint ventures including one with BSES, utility powertech, to provide technical services and is also a minority partner in the Power Trading Corporation, a joint venture of public sector undertakings.

The corporation has floated a number of subsidiaries including one for mini-hydroelectricity project, electricity distribution and power trading.