The project envisages setting up a 2.5-million LNG terminal and a 1,886mw power plant at Ennore, Tamil Nadu, which will ensure the offtake of LNG. The project is being set up on a build-own-operate (BOO) basis.

The consortium has also finalised the equity structure with Unocal Corp of US holding a 17 per cent stake, while the balance will be equally split among the remaining partners: AV Birla flagship Grasim, CMS Energy of US, Woodside Petroleum of Australia and German major Siemens, which will hold 20.75 per cent each.

The entire process of LNG unloading, regassification, and storage operations will be conducted at the terminal. The natural gas from the plant will fuel the 1,886mw power plant which will sell the electricity to the Tamil Nadu Electricity Board.

The Aditya Birla group-ledconsortium has outbid a host of multinational giants in bagging a project which includes Enron-Mistubishi, Shell-PowerGen and Petronas-Petronet-Tenaga.

The project is expected to be commissioend in 2003 and in the first year the tariff is expected to be around Rs 2.75 to Rs 2.80 per unit. The cost of the power plant works to Rs 2.3 crore per mw.

It also marks the Aditya Birla group's branching out in a related area of operation. Though the group has not yet begun operating any independent power project, it has huge investments lined up in its Bina and Rosa power projects, where it is being partnered by PowerGen of UK.

The group has decided to branch out into power and energy after setting up captive power capacities at its integrated power project in Renukoot. The efficient running of these plants have allowed it to keep its power costs at sufficiently low levels, which makes group company Hindalco one of the lowest-cost aluminium producers in the world.

The group has also announced interest in powerdistribution once private players are allowed in. It has already put in a bid for Orissa Power Grid Corp, which is about to privatise its distribution arm, along with Singapore Power.

The Ennore project will also be the second for the US-based CMS Energy which is setting up one of the fast-track power projects with non-resident Indian Siddharth Tak.

The Tamil Nadu Industrial Development Corp (Tidco) is currently finalising arrangements for the power purchase agreement and escrow modalities with the Aditya Birla group-led consortium.