GMR to set up 160 Mw hydel project in Arunachal

GMR Energy, the holding company for the GMR Group's energy business and a subsidiary of GMR Infrastructure Ltd, has signed a memorandum of agreement (MoA) with the Government of Arunachal Pradesh for implementation, operation and maintenance of the 160 Mw Talong hydro power project on BOOT (build, own, operate and transfer) basis, in the district of Seppa, on River Kemeng.

The Project was awarded on competitive bidding basis. The plant is scheduled to be commissioned by 2011-end.

The project, estimated to cost Rs 900 crore, will be funded through a 70 per cent debt component and the balance through equity.

According to a statement from GMR Group, the detailed project report (DPR) for this project has already been prepared and it has also received Stage-I environmental clearance from the Union Ministry of Environment and Forests. The construction work for the project is expected to commence in a year's time.

As per the terms of the MoA, the company will offer 14 per cent of free power to Arunachal and an additional two paise per kilowatt-hour as royalty to the state. The company has also offered 12 per cent of equity to the state in the hydro power company. Arunachal also has the right to purchase power from the project over and above free power availed by it.