Tata And Essar Plants In Gujarat Fit For Takeover: NTPC

Tata And Essar Plants In Gujarat Fit For Takeover: NTPC

The stressed imported-coal based power plants of Tata Power and Essar Power in Gujarat are fit to be taken over and can be operated without technical glitches, state-run NTPC has found in its technical assessment.

The technical assessment of Adani Power’s Mundra power project is likely to be completed this week and a formal report on the three projects may be submitted by NTPC within a fortnight, sources said. The report assumes importance in the backdrop of offers made by the three companies to Gujarat state electricity generation utility for acquiring their plants for Rs 1 each. Sources said an important meeting is likely to be held on Monday in Gandhinagar.

Likely participants are Gujarat energy minister Chiman Shapariya, state additional chief secretary Sujit Gulati, Gujarat Urja Vikas Nigam Ltd (GUVNL) managing director Pankaj Joshi and lenders including State Bank of India chairperson Arundhati Bhattacharya. A meeting between Gulati and top SBI officials was held on the matter last Friday too.

Sources in GUVNL said the company was considering the offer and it was early to decide on the amount of equity to be acquired and the operations and maintenance of the plants.

Calls and text messages sent on Sunday by ET to Gulati and Joshi remained unanswered.

NTPC carried out the due diligence of the three projects based on a request from distribution companies and lenders to the beleaguered plants. The assessment has been done on technical parameters, including past operational performance of the projects, quality of coal used in the projects, estimated residual life and various other factors.

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Tata Power and Adani Power have offered majority stakes in their imported coal-based power plants in Gujarat to the state government at Rs 1 each.

In separate letters to GUVNL, the companies have offered to sell 51% equity at Re1each, while retaining the balance with them. Tata Power operates the 4,000-mw Mundra ultra mega power project that has power supply pacts with five states. Adani Power’s board has already approved hiving off its 4,620 mw-Mundra power plant into a separate subsidiary and is exploring offering stake to GUVNL that buys 2,000-mw from the project.

Essar Power too has offered its 1,320-mw Salaya plant to Gujarat after an adverse ruling on April 11 by the Supreme Court.

The apex court said that increase in coal prices due to change in overseas laws cannot be considered as change in law under the PPA. Gujarat chief minister Vijay Rupani had written to the power ministry seeking its intervention based on representations by the companies that operating the power plant was becoming unviable.

Union minister for power, coal, renewable energy and mines Piyush Goyal has said the central government is willing to play the role of a facilitator to bring all the stakeholders on the table so that an informed, considered view can be taken.

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