Neyveli Lignite Corporation (NLC), the central public sector undertaking (PSU), has initiated dialogue with Chennai Petroleum Corporation Ltd (CPCL) to set up a joint venture 49 3mw power plant using petroleum residue at an approximate Rs 2,500 crore in Chennai, A K Sahay, chairman and managing director of NLC said.
He said the agreement with CPCL would be finalised in the next six to eight months, adding that proposed plant would be able to produce power at Rs 3 per unit.
Other than the CPCL venture, Sahay said that negotiations with the Rajasthan government to set up a lignite-cum-power plant (250 MW) had reached the final stage and the memorandum of understanding (MoU) with the government would be signed in the next two months. NLC is also holding negotiations with Gujarat to set up a 240 mw power plant with the state supplying lignite.
On the funding, P R Balasubramanian, director (power), NLC said the enterprise during last fiscal posted a profit of Rs 500 crore excluding receivables, adding that with expected commencement of thermal power station (TPS-I) expansion with a capacity of 420 mw by March 2002, the cash flows would further improve. "We are not looking at budgetary support and have planned to maintain a debt-equity ratio of 3:1 for our expansion projects," he said.
In Neyveli itself, the company is planning to set up a new mine (Mine- III) with a capacity of 8 million tonne and a power plant (TPS-III) of 1000 mw, at a combined investment of Rs 9,000 crore.
NLC, during April- August 2001, has posted a profit before tax (PBT) of Rs 317.96 crore, thus registering a 54.19 per cent growth over the corresponding period last year. Lignite production and gross power generation during the same period increased by 0.36 per cent and 105.6 per cent.
