Hinduja Power, owned by the $15-billion Hinduja Group, is in talks with three West Asian companies, including a Qatar-based gas firm, to purchase gas for its power plants in Maharashtra and Gujarat. The gas-based power plants will have an approximate capacity of 1,000 MWs each. The company, which is targeting a 10,000 MW power production in the next 7-8 years, will start construction of its 1,040 MW coal-based plant in Vizag next month.
Speaking to FE, Ashok Puri, managing director, Hinduja National Power Corporation, said, ?Contrary to the situation 2-3 years back, where the availability of gas was less, nowadays, availability has improved worldwide, which has also resulted in prices coming down.?
Once the construction for Vizag plant starts, the company will commence work in Gujarat and Maharashtra. The company has already requested the Gujarat and Maharashtra governments for land. The projects for the 10,000-MW production will be based in 4-5 locations and apart from the Vizag project, Hinduja Power plans to set up two more coal-based power plants. Hinduja Power is in talks with a few private equity players to dilute a minority stake in order to raise funds.
Puri added, ?The gas-based projects can be commissioned in 30 months against 39-40 months needed for coal-based projects. Land requirement is also less as plants can be set up in one fifth of the land normally required for coal-based projects, causing the capital investments be reduced 20-25% less per MW.? He has mentioned that the gas can be sourced at rate of $6-8 per million British thermal unit (mmBtu).
The Vizag project is expected to be commissioned in 39 months. About 25% of the power will be supplied to the Andhra government, 60% to Power Trading Corporation of India Ltd and 15% will be to the market. It has tied up with Mahanandi Coalfields Ltd in Orissa for coal procurement for the 1,040 MW project. Hinduja Power may expand capacity if additional land is allotted. Now, Hinduja Power holds 1,100 acre of land in Vizag. Qatar Investment Authority, promoted by the Emirate?s ruling family, is in the final stages of negotiations. to purchase 10% in Hinduja Power.