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State run miner Odisha Mining Corporation (OMC) has got the government’s nod to lend Rs 500 crore to bulk power purchaser Gridco.
The loan from OMC, that is sitting on a cash reserve of over Rs 5,000 crore, is expected to come as a huge relief to cash strapped Gridco.
“The government is pleased to allow OMC to consider lending Rs 500 crore to Gridco in the first phase. OMC is assured that the re-payment of the amount will be made by Gridco as per the time frame mutually agreed upon”, C K Sadangi, additional secretary (energy) wrote to Girish S N, managing director, OMC.
Gridco is borrowing from OMC in phases to partly clear its mounting dues and also to swap some high cost loans. The rate of interest on the loan will be 1.5 per cent premium over the fixed deposit interest rate of State Bank of India (SBI) which comes to approximately 10 per cent.
“The loan from OMC will be used to pay off the pending power dues of Odisha Hydro Power Corporation Ltd (OHPC), National Hydro Power Corporation (NHPC), NTPC and Odisha Power Generation Corporation (OPGC). Their dues have totaled to nearly Rs 1,500 crore. In the next phase of borrowing, Gridco will swap some high cost loans along with clearing the dues,” a senior Gridco executive said.
In December 2012, Gridco had borrowed Rs 500 crore from OMC mainly to pay off the dues of Vedanta Group. The group had raised a demand of Rs 744 crore on the bulk power purchaser for supply of electricity to the state grid from its coal-fired plant and captive power plant at Jharsuguda.
