Neyveli to go solo: Rs 11000 cr TN plant

Neyveli Lignite Corporation Ltd (NLC) is to single handedly go ahead with the Jayamkondam integrated mining-cum-power project that envisages a total investment outlay of Rs 11,000 crore to set up a 2,000 MW power plant and an accompanying lignite mine.

The feasibility study is to be carried out shortly, said S Jayaraman, chairman and managing director, NLC. The project will have two phases.

In Phase I there will be a 1,000 MW power plant with a 8 to 9 million tonne lignite mine at an investment of Rs 6,000 crore. The capacity will be enhanced to 2,000 MW in the Phase-II with an investment outlay of Rs 5,000 crore.

Jayamkondam is located about 240 kilometers south-west of Chennai. The Tamil Nadu government has given its consent for NLC to take up the Jayamkondam project, said Jayaraman, but did not specify a time frame for project's completion.

C Ponnaiyan, the finance minister of Tamil Nadu in the Budget 2005-06 presentation had mentioned that the Jayakondam project will be jointly taken up by NLC and the Tamil Nadu Electricity Board(TNEB).

When asked as to why the Jayamkondam project was given to NLC, while the proposed Tuticorin power project was a joint venture between NLC and TNEB, Jayaraman said the former entailed a larger investment and was meant for faster completion. The Jayamkondam project has been hanging fire for a decade now.

Almost 70 per cent of power generated by the Jayamkondam project will be supplied to Tamil Nadu while the remaining will be distributed to other three southern states.

Jayaraman said that the Memorandum of Understanding to set up the new joint venture company to execute the Tuticorin project is expected to be signed tomorrow.

The Tuticorin project will have only a power plant of 1,000 MW capacity with a outlay of Rs 4,000 crore. There is an option to import coal for this project, he added.

Jayaraman said that both these projects are expected to get the central government's sanction in a year's time.

"NLC's lignite mining capacity at Barsingnar mine and power projects in Rajasthan will be increased from 24 million tonne at present to 30.6 million tonne and power generating capacity from 2,490 MW to 3,140 MW by 2009- 2010," he added.

Jayaraman said that NLC was able to realise the current bills for supply of electricity almost 100 per cent during the year. The power dues was Rs 320.12 crore which is equivalent to 48 days of sales as compared to the outstanding dues of Rs 570.59 crore equivalent to 79 days of sales as on March 31, 2005.