Twitter
Advertisement

Nagarjuna junks Sompeta plan, buys Nelcast stake

Nagarjuna Construction Co (NCC), the infrastructure major that faced hurdles in setting up its flagship power plant in Sompeta, Andhra Pradesh, has acquired 55% equity in Nelcast Energy Corporation that is also setting up a plant in the state.

Latest News
article-main
FacebookTwitterWhatsappLinkedin

Nagarjuna Construction Co (NCC), the infrastructure major that faced hurdles in setting up its flagship power plant in Sompeta, Andhra Pradesh, has acquired 55% equity in Nelcast Energy Corporation that is also setting up a plant in the state.

With this, it has given up plans for the Sompeta plant and has sought to transfer approvals for it to the plant being built by Nelcast Energy.

NCC Power Projects Ltd, Nagarjuna’s subsidiary, acquired the stake from the Chennai-based Nelcast group for Rs 150 crore. The rest 45% in Nelcast Energy is held by Gayatri Projects.

Nelcast has already secured the approvals for setting up a 1,320 mw thermal power project near Krishnapatnam in Nellore district of AP. 

However, the company is yet to commence any works on the project.

NCC’s proposed 1,320 mw project at Sompeta in Srikakulam ran into troubles after locals opposed it fearing pollution. The tiff between the locals and the company took an ugly turn after police firing on the protestors killed two locals. Following this incident, the environment clearance granted to the project was put on hold, forcing NCC to look for an alternate location.

“Nelcast has all the approvals in place and also the land required for the project. We will take it forward from here,” YD Murthy, NCC’s senior vice-president (finance), told DNA.

Murthy said the project cost remains at Rs 7,000 crore with a debt-equity of 75:25. “We will achieve financial closure for the project by March 31, 2011. The commissioning of 660 mw plant would be done in 42 months and the second one would be commissioned in 46 months,” he said.

NCC is currently engaged in getting certain approvals received for its earlier Sompeta project to the new site. The coal linkages and the funding by agencies including REC and PFC will now be transferred to Krishnapatnam.

About 865 acres are already in possession of Nelcast including 291.21 acres government land and the balance procured from private parties.

“Krishnapatnam is a better location compared to Sompeta since there is an immediate water source in the form of Bay of Bengal and a facility for importing coal at the Krishnapatnam port,” a source said.

Find your daily dose of news & explainers in your WhatsApp. Stay updated, Stay informed-  Follow DNA on WhatsApp.
Advertisement

Live tv

Advertisement
Advertisement