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| UPDATE: GE-Ratnagiri Gas pact may reduce Maharashtra's power woes |
| Press Trust of India / Mumbai Jul 08, 2009, 14:23 IST |
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GE Energy has signed an eight-year agreement with Ratnagiri Gas and Power Pvt Ltd ((RGPPL) for equipment supply and rehabilitation of machines for the Dabhol power plant, the complete revival of which will ensure reliable electricity supply to energy-starved Maharashtra.
The agreement guarantees energy availability for GE's power generation equipment, improving the plant's production, and supply and repairs of spare parts.
RGPPL, which owns the gas-based plant, was incorporated in 2005 to revive generation at the facility which had been beset by problems like equipment failure and a financial crunch.
The plant in Ratnagiri, Maharashtra, was shut in 2001 following legal battles between Maharashtra Government and US-based Enron Corp over cost of power production and tariffs. Operations were resumed in 2006.
"The plant currently generates about 950 MW of power. I expect it to achieve full load generation of 1,940 MW by March 2010," RGPPL Managing Director A K Ahuja told reporters here last night.
Of the six turbines at Dabhol, only three are working, each having a capacity of 310 MW.
GE and RGPPL have inked a Comprehensive Service Agreement and Rehabilitation Agreement, whose total deal value is understood to be around $130 million.
The long-term agreement can be renewed for another eight years.
"We still have to sign the Mandatory Spares Agreement, for which we require $60 million," Ahuja said, adding the "average budget for operational maintenance of the plant comes to about Rs 400 crore a year."
RGPPL has signed a Gas Sales and Purchase Agreement with Reliance Industries for sourcing 2.7 mmscmd of gas from the latter's KG D6 fields till September.
The company is scheduled to receive a total of 8.4 mmscmd of gas from the D6 fields from October 2009 at $4.20 per mmBTU, Ahuja said.
This domestic allocation to RGPPL by the Government will ensure cheaper power for the Maharashtra grid compared to the imported liquefied natural gas (LNG) that the company buys from Petronet LNG.
RGPPL, promoted by NTPC, GAIL, Maharashtra Government and lending institutions, currently uses up to 4.2 mmscmd of regassifid LNG from Petronet.
It had filed a petition with the Central Electricity Regulatory Commission (CERC) in April, proposing a tariff hike of up to Rs 4.44 per unit (capacity charge Rs 2.65 + Rs 1.79 fuel charge) for 2009-10.
CERC still has to give directions on the matter.
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