Lanco Amarkantak, the Hyderabad-based Lanco Infratech’s power project, is finally ready for take off.
Lanco Amarkantak will have total capacity of 1,920 mwHYDERABAD: Lanco Amarkantak, the Hyderabad-based Lanco Infratech’s power project, is finally ready for take off. The project, being developed near Pathadi in Chhattisgarh, is expected to go on stream by the end of this month.
Being developed in four phases, Lanco Amarkantak will have a total capacity of 1,920 mw. Of this, the first 300-mw capacity will be ready for operations by month-end.
L Madhusudan Rao, chairman, Lanco group, said the company would synchronise the project with the grid in November.
“Commercial operations will begin from January 2009,” he said. The second phase of the project will create another 300-mw capacity and the other two phases will together build power generation capacity of 1,320 mw. Lanco Infratech has a coal linkage with South Eastern Coal Field Ltd for the project.
The project has been hanging fire for some time now due to a host of issues including the signing of power purchase agreements (PPAs) with the Power Trading Corporation (PTC) and the Madhya Pradesh State Electricity Board (MPSEB). The power ministry had to intervene to facilitate an agreement between PTC and Lanco Infratech. Once operational, this will be the first Chinese equipment-based operational power plant in India.
The project cost for the first phase is pegged at Rs 1,290 crore with 80:20 debt-equity ratio. Besides Lanco Infratech, the coal-based power project has three key partners - the Hyderabad-based KVK Energy Pvt Ltd; DEG, a financial institution fully-owned by the German government; and IFC, Washington. Lanco Infratech holds about 77% of the equity and the other three are minority partners.
Meanwhile, the issue of the project being converted into a merchant unit remains unresolved. The company was keen on opting out of the PPAs with MPSEB and others and switching to a merchant power producer model, which gives it greater freedom to sell power to states that offer better tariffs.
For the second 300-mw unit at Lanco Amarkantak, PTC has agreed to sell power to Haryana Power Generation Company Ltd. “The issue of PPA and conversion to merchant model is pending in courts and will take some more time to be resolved,” Rao said.
Lanco Infratech’s power division has been working aggressively on several power projects. It has 519-mw capacity in operation including gas-based units such as Lanco Kondapalli (368 mw) in Andhra Pradesh and ABAN Power (120 mw) in Tamil Nadu. In addition, projects of about 7,885 mw, with different fuel needs like coal, gas and hydro, are in various stages of execution.
k_ramana@dnaindia.net 
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