20 in fray for Orissa UMPP

Tata Power, Larsen & Toubro, Adani and Vedanta are among the 20 companies that have bid for the government's fifth ultra mega power project (UMPP) at Bedabahal in Orissa’s Sundargarh district. So have government-owned Nalco and NTPC, besides companies from groups such as Essar, Aditya Birla, RPG, GMR, GVK, CESC, Welspun, Jaypee, Torrent and Videocon.

Lanco is in the fray; it had not bid for any UMPP after it lost the race for the first one in Sasan, Madhya Pradesh, to Reliance Power. JSW and Jindal Power are also participating.

The Orissa project —Rs 17,000 crore, 4,000 Mw — was put up for bidding after the fourth UMPP at Tilaiya (Jharkhand) was awarded to Reliance Power in January 2009. The RFQ (request for qualification) bids opened on Monday also have applications from foreign companies AES Corporation of the US and China Light and Power.

Reliance Power, which had bid for all previous UMPPs and won the race to develop three, has not bid for this one. The ministry of power had decided that a company developing three UMPPs may not bid for more.

The Orissa UMPP is of special interest to power companies, as it comes with captive coal mines. "This is a domestic coal-based project, one coming after a huge gap and it will get a lot of interest from the bidders. Projects with a captive coal mine always get a lot of interest from the market, " said Debashish Mishra, senior director, Deloitte Touche Tomatsu.

The project was delayed because of blocked clearance from the ministry of environment. The bids were originally called last year. Three coal blocks were allotted for the project in June.

Analysts say the financial bids might be rational for a change, due to the high interest rate situation, unlike the ones in the past.