Chennai, Aug. 9 Elango Industries Ltd, a company listed with the Bombay Stock Exchange, plans to set up an 80 MW coal-based group captive power plant at Gummidipoondi, near Chennai. The plant is estimated to cost Rs 415 crore, of which the equity component works out to about Rs 125 crore and the balance will come through debt.
A group captive power plant is one where companies take up to 26 per cent equity stake and is assured of up to 51 per cent of the electricity generated from it.
Elango Industries was earlier into manufacturing steel ingots and wound this up in 2003 following the downturn in the steel processing sector. It set up a 7 MW gas-based group captive power plant at Mayiladuthurai in Tamil Nadu, with GAIL supplying gas for this plant.
Apart from Elango Industries, which set up the gas power plant through a special purpose vehicle Kaveri Gas Power Ltd, the other equity partners are some steel processing companies and textile mills in Tamil Nadu, which together hold 31 per cent of the project’s equity.
According to Mr S.A. Premkumar, a director of Elango Industries, some of the equity holders in Kaveri Gas Power Ltd are interested in picking up stake in the 80 MW coal-based project. Elango Industries is also in talks with other interested companies. It plans to add another 135 MW at Gummidipoondi
He said that Elango Industries had tied up with Coal and Oil Company of Dubai, which would supply Indonesian coal to the plant, and was trying to get domestic coal allocated for the plant. It hoped to achieve financial closure by December 2008.
Mr Premkumar said equipment suppliers such as BHEL, Thermax Ltd and Cethar Vessels, and four Chinese equipment suppliers, including Dongfang, were among those that had submitted bids for supplying boiler, turbine and generator for the plant.
Mr S. Elangovan, Managing Director of Elango Industries and Kaveri Gas Power Ltd, said that the company was in talks with some power traders, including PTC Ltd, to sell surplus power from the Gummidipoondi plant.