• PAGE ONE
• INDEX
• HOME

KPCL opts for bridge loan again

Our Bureau

BANGALORE, Nov. 3

KARNATAKA Power Corporation Ltd (KPCL) has taken the bridge loan route for the second time for meeting the funding requirements of the 210 MW Unit 7 of the Raichur Thermal Power Station (RTPS).

Briefing reporters here, the KPCL Managing Director, Mr K. Jyothiramalingam, said that the bridge financing was being resorted to since the project has not yet attained financial closure. He attributed the failure to achieve financial closure to the dela y in finalising an integrated power purchase agreement as required by the electricity regulatory commission.

However, he also said there were some time overruns in the conditions specified in the multipartite agreement signed last year. These conditions were put forward by the lead arranger for the debt funds, Infrastructure Development Finance Company Ltd, for Rs 512 crore.

The second round bridge financiers include Canara Bank (Rs 70 crore), Allahabad Bank (Rs 100 crore), Central Bank of India (Rs 50 crore), Development Credit Bank (Rs 37 crore), Indian Overseas Bank (Rs 25 crore) and Syndicate Bank (Rs 50 crore). The firs t round of financiers included Andhra Bank, Syndicate Bank and Canara Bank.

He said that the power tariff from Unit 7, when it goes into commercial operation, was likely to be below Rs 2.50 a unit. However, if all the units are taken into account for the common PPA as sought by the ERC, the tariff is likely to be lower at Rs 2 a unit.

Referring to the progress of Vijaynagar Thermal Power Station (VTPS), Mr Jyothiramalingam admitted that they were not in a position to enter into the joint venture agreement with Larsen and Toubro. He, however, added, ``we will go ahead with the project with or without a joint venture partner''. But, he said the State Government had sought the participation of other entities in the joint venture, though he declined to specify the names.

But in the case of the 290 MW Almatti power project, he said that tenders for the Engineering, Procurement and Construction contracts would be floated in the next two months. As for the Bidadi project, the KPC was still examining the possibility of sourc ing the gas.

He said initial efforts to obtain gas through Ennore have not been very encouraging. This was because gas supply to Bidadi would depend on the power offtake arrangement entered with the Tamil Nadu Government. He, however, added that KPCL was examining an offer made by Petronet LNG for supply through the Cochin Terminal.

For the current financial year, KPCL added was likely to face a shortfall in generation to the extent of about 2,900 million units from the hydel stations in view of the weak monsoons. This deficit would hit its revenue generation and consequently its pr ofitability as well. Referring to the proposed restructuring of KPCL, he said IDFC had submitted a report to this effect and it was being examined.