Tata Power - DVC break new Ground on 1,000 MW Maithon Right Bank, Mega Power project

Tata Power Company Ltd has announced that Maithon Power Ltd, a Joint Venture between the Company and Damodar Valley Corporation on September 27, 2006 has announced its ground breaking for the 1000 MW Mega Power Plant at Maithon site. The ground breaking ceremony for this project was conducted on September 27, 2006 at the hands of Shri. Sushilkumar Shinde, Hon’ble Minister of Power, Government of India in presence of Shri. Madhu Koda, Hon'ble Chief Minister of Jharkhand. The 1000 MW Right Bank Thermal Power Project is the first initiative in public partnership in the area of generation. This follows similar successful, pioneering partnership initiatives of the Company with the public sector in transmission and distribution through Powerlinks (Tata Transmission project) and NDPL (distribution in Delhi), marking it out as the only private sector entity to Lead the way in public-private JVs in all core areas of the power sector.

Power from the Maithon Project is to be exported to power deficit western and northern states and for meeting the requirements of Damodar Valley Corporation (DVC). Financial closure for the Maithon Project is targeted around mid 2007. As per current plans, the project will comprise of two generating units of which the commissioning of the first unit is scheduled for Late 2009 and that of the second unit by mid 2010. The total Land required for the project is about 1200 acres and currently a significant portion of the land has been acquired by DVC. The project has all the major permits and clearances, including from the Pollution Control Board and MoEF. Long-term coat linkage has been allotted from BCCL mines and water allocation is from the adjacent Maithon reservoir.

Speaking on the occasion, Shri. Sushilkumar Shinde, Hon'ble Minister of Power, Government of India, said "I am happy that the much awaited 1000 MW Maithon Right Bank Power Project is being commenced through a pioneering Joint-Venture initiative of Tata Power and DVC I am delighted to be present for the auspicious occasion of Ground breaking ceremony of this historic project"

Mr. Adi Engineer, Director, of the Company said, "This Joint Venture is a public-private partnership towards meeting the power supply needs of the country. For Tata Power, the venture also marks an initiative towards acquiring a truly national footprint and providing power at economic rates for the end consumer. The Agreement marks a successful trend and offers hope for more such joint initiatives for the power sector in the future.

The Company had earlier signed the Shareholders Agreement with DVC for the 1000 MW Project being developed by Maithon Power Ltd. The Company has 74 % equity in the venture, with the Government of India established Damodar Valley Corporation holding 26 % equity. The estimated capital cost of the project is around Rs 3800 crores and will be funded through a 70:30 debt to equity ratio. The Company will contribute approx. Rs 840 crores to the equity corpus, with DVC contributing about Rs 300 crores.

Source : Equity Bulls

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