The Hindu Business Line : NTPC, Gujarat Govt pact for power project at Pipavav

NATIONAL Thermal Power Corporation (NTPC) has recently entered into a Memorandum of Understanding (MoU) with Gujarat Government to set up a 2,000 MW power generation project at Pipavav, Gujarat.

The project will operate on liquefied natural gas or imported coal. The project is being developed as a 50:50 joint venture between Gujarat Power Corporation Ltd (GPCL) and NTPC. Power from the project will be bought by GPCL, while the project will be operated by NTPC, sources said.

The project will enjoy `mega' status, which will entitle it to duty free import of equipment, which will reduce the power generation cost.

According to the MoU, GPCL will off-take power from the project at 80 per cent of the project capacity. The project will be set in two phases. In the first phase, 1,000 MW will be commissioned with another 1,000MW to be set up in the second phase.

The MoU merely mentions that the project will be done on a 70:30 debt-equity ratio. NTPC officials pointed out that revenues from a distribution zone in Gujarat would act as a payment security mechanism for the power purchase sold by the joint venture company to GPCL.

As early as 1999, the Centre identified Pipavav as a site to set up a `mega' power project aided by the fact that Pipavav is an all-weather port.

More Stories on : Alliances & Joint Ventures | Power

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