The Hindu Business Line : Essar Power to hike Hazira plant capacity

ESSAR Power Ltd (EPL) is setting up a 1,500-MW plant at Hazira that already has a 515-MW plant. This will take EPL's aggregate capacity at Hazira to 2,015 MW. The plant, which qualifies as a megapower project, is expected to cost some Rs 4,000 crore, at Rs 2.67 crore per MW.

Essar officials confirmed the investment plan, following an announcement to this effect by Mr Sashi Ruia, Chairman of Essar group, in Ahmedabad on Wednesday.

"A 1,500 MW power project is being planned in Hazira," Mr Ruia said at the `Vibrant Gujarat' function as part of a Rs 16,000-crore investment plan in the State.

A company spokesperson said the power project was at its initial stages of development.

Work has started at the site and it is likely to be completed by 2006-end, he said.

Essar Power is understood to have approached Power Finance Corporation (PFC) for financing the project.

The project will have gas as fuel and the company is eyeing gas from either Dahej (Petronet LNG) or Hazira (Shell).

The project funding is structured in such a way that tariffs could be below Rs 2.50 per unit for the new facility.

The current tariff of power produced by EPL's combined cycle power plant is around Rs 2.80 per unit.

Of the 515 MW, 300 MW is supplied to Gujarat Electricity Board while 215 MW is consumed by Essar Steel.

The other projects announced by Mr Ruia include a Rs 6,000-crore investment by Essar Steel Ltd in two phases. The 2.4 million tpa Essar Steel will first take up its capacity to 4.6 million tpa by 2006 and then to seven million tpa by 2008. Essar also announced a Rs 6,000-crore investment plan for the completion of its Vadinar refinery.

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