VA Tech Wabag is set to commission the Rs 500-crore operation of the 100-million-litre-a-day desalination plant it is setting up for Metrowater, the city’s water utility.
Wabag, which is handling the Rs 580-crore EPC, has the licence to handle the operation and maintenance of the plant for seven years.
The O&M contract represents a Rs 500-crore revenue during this period.
The Rs 1,033-crore desalination plant, which will convert seawater to drinking water for Chennai, is at an advanced stage of commissioning, with ongoing trials, and is targeted for completion by December.
The project achieved an important milestone on Friday when it was ‘energised’ with a dedicated 110 kVA substation. This will feed it the 24MW of power the plant needs.
S. Varadarajan, Chief Financial Officer, VA Tech Wabag, said trial runs of the various modules are on. Once completed, the plant will achieve full capacity in December and this will mark the end of the EPC contract for the company.
The O&M portion of the contract will start in January, after the formalities, and this will mean a revenue of about Rs 70 crore a year for seven years. Wabag hopes to see a portion of the revenue flow start in the fourth quarter of the current year, he said.
VA Tech Wabag, a Chennai-based multinational in water treatment, bagged the contract for the plant along with IDE Technologies of Israel in 2010.
The project, located on the East Coast Road about 35 km south of Chennai, is funded by the Central Government. It will convert seawater to drinking water for supply to southern parts of the city.
A sixth of city’s needs
At the plant, workers are busy giving the final touches to the system. The plant will use a process known as reverse osmosis to remove the salts in the sea-water and make it fit for consumption. Over 250 million litres of sea-water will be drawn daily to produce about 100 million litres of potable water.
This is nearly one-sixth of the city’s daily requirement and will meet the fast-growing need in Chennai’s southern suburbs.
This is the largest contract in Wabag’s order-book and will qualify it to bid for similar utility-scale projects globally. “This is a reference for the company in membrane-based sea-water reverse osmosis,” Varadarajan said.