Date:09/06/2005 URL: http://www.thehindu.com/2005/06/09/stories/2005060913550700.htm

Tamil Nadu

NLC to execute power project on its own

Special Correspondent

"Project will be executed fast"

`` TO GO IT ALONE": S. Jayaraman, Chairman and Managing Director, Neyveli Lignite Corporation, at a press conference in Chennai on Wednesday. — Photo : Bijoy Ghosh

CHENNAI: : The Jayamkondan lignite power project, envisaging production of eight-nine million tonnes of lignite and power generation of 1,000 megawatts in the first phase, will be executed by the Neyveli Lignite Corporation on its own, the NLC chairman-cum-managing director, S. Jayaraman, said on Wednesday.

"Originally, it was to be implemented as a joint venture project. Subsequently, we felt that we would be able to execute the project faster if we took it up alone. Our suggestion was accepted by the State Government," Mr. Jayaraman told mediapersons here.

Feasibility reports and other reports were under preparation and they would be ready in a year. The total cost of the project was now estimated at Rs. 6,000 crores, of which the power generation component would require Rs.4,000 crores-Rs.5,000 crores and the mining component — Rs. 1,000 crores. "As adequate lignite is available there, we can go in for another 1,000 MW," Mr Jayaraman said.

(In the last 15 years, two attempts were made to implement the project with the participation of the private sector).

On Thrusday, the NLC would sign an agreement with the Tamil Nadu Electricity Board to take up the coal-based thermal power project at Tuticorin. The agreement would lay down the terms and conditions governing the project that would generate 1,000 MW in the initial phase. A special purpose vehicle would be floated, comprising representatives of the NLC and the TNEB. It would be headed by a nominee of the Corporation as the NLC's share of equity would be 89 per cent (while the remaining 11 per cent would be contributed by the TNEB).

"One year may be needed for obtaining all the clearances," Mr Jayaraman said, adding that once the approvals were obtained, the project would be commissioned in 36-38 months.

The NLC said that power from the Tuticorin and Jayamkondan projects would be supplied to the southern States, though Tamil Nadu would "naturally" receive the major share.

Asked whether the corporation proposed to implement the Jayamkondan project on its own in view of the delay in the execution of the Tuticorin project, Mr Jayaraman said: "That is one of the reasons. But, a joint venture project requires clearances from both the Governments, Central and State." (In June 2003, the NLC and the TNEB signed a memorandum of understanding to implement the project).

"Our vision is to triple our power production capacity in seven years. Now, our capacity is 2,500 MW. We want to take it to 7,000 MW or 7,500 MW," the NLC chief said.

Financial performance

Mr. Jayaraman said the sales turnover for 2004-05 stood at Rs.3,001 crores compared to Rs.2,806 crores in 2003-04. The NLC recorded a post-tax profit of 1,215 crores last year against Rs. 1,143 crores in the previous year.