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Gujarat allocates Tapti gas to Kribhco's power project

Vinod Mathew,

GANDHINAGAR, Dec 14

THE Gujarat Government, which has been granted an in- principle allocation of 2.25 mmscmd of gas from the Tapti fields by the Ministry of Petroleum and Natural Gas, has reallocated the same to Kribhco. According to sources in the Ministry of Energy, the gas has been earmarked for the 615-MW dual fuel power project being put up by the newly registered Kribhco Energy Ltd (KEL).

The Rs 2,141-crore fertiliser major has a 89 per cent stake and the Gujarat Power Corporation Ltd (GPCL) has the remaining 11 per cent. The 2.25 mmscmd gas allocation was sufficient for the plant to function at a PLF of 68.5 per cent but would have to pr ocure alternate fuel for a higher PLF, sources in the Ministry said.

Mr P P Singh, Managing Director of Kribhco, who was here last week, expressed his dissatisfaction with the tardy progress of the project. He had said that Kribhco, with a cash balance of Rs 1,420 crores as on April last, had identified Gujarat for future investments, the 2,300 tpd expansion of the Hazira fertiliser expansion being the other focus area. The financial closure of the Pipavav project was scheduled to take place in the next six months, he said.

Though the draft shareholders agreement has already been approved and is likely to be signed in the coming few weeks by both the parties, there are quite a few areas that still need to be addressed by KEL. One of the few power projects that went through the MoU route last year, the Pipavav power project with a 70:30 debt-equity ratio, is slated to sign the PPA with the Gujarat Electricity Board (GEB) some time early next year.

However, the KEL is yet to get the requisite clearances from the Ministry of Environment and Forest (MoEF) just as it has not made any arrangement for alternate fuel with an oil company. Though the new company has been registered, a joint venture agreeme nt is yet to be inked as the shareholders agreement is still pending. The other area that the generation company will have to address is signing of a gas suppliers agreement with the Gas Authority of India Ltd (GAIL) for the Tapti gas.

Meanwhile, the 615 MW project which is coming up in Rajula in Amreli district some 12 kms from the Pipavav port, will achieve a milestone with the opening of global tender for the EPC contract on December 14. There are five MNCs in the race including two Japanese firms, Toshiba Corporation and Mitsubishi Corporation. The three other offshore companies are Alstom Power, Switzerland, Siemens A G, Germany and Korea Heavy Industries & Construction Company Ltd (Hanjung). The Indian contenders who have purcha sed the tender document include BHEL and L&T.