Neyveli Lignite plans to buy 1200 MW Raghunathpur Thermal Power Project

Company plans to float a JV in which it will have majority stake

Neyveli Lignite (NLC) is planning to acquire a 1200 MW Raghunathpur Thermal Power Project (RTPP) of Damodar Valley Corporation (DVC) through a joint venture company (JVC) proposed to be formed with DVC with an equity shareholding of 74:26 by NLC and DVC.

While NLC's management was not available for comment, in an announcement to BSE, the company said as part of its corporate plan, NLC has initiated actions to acquire power assets and one of the proposals under consideration is the acquisition of 1200 MW Raghunathpur Thermal Power Project (RTPP) of Damaodar Valley Corporation (DVC) through a joint venture company (JVC) proposed to be formed with the DVC with an equity shareholding of 74:26 by NLC and DVC, said the company.

RTPP consists of two units of 600 MW each and both the units have been commissioned during March 2016. As per the proposal, the project cost as determined by CERC/ APTEL for the purposes of arriving at the final tariff for power or such cost as mutually agreed between NLC and DVC would be the consideration value for the transfer of RTPS project assets to the JVC.

The proposal for investment in the JVC is required to be sanctioned by the government of India, said NLC.

The ministry of coal, the administrative ministry, in consultation with the other ministries, is in the process of submitting the proposal to the Cabinet Committee on Economic Affairs for sanction of investment decision.

On obtaining sanction from the government of India, further course of actions with regard to entering into joint venture agreement and formation of JVC with the DVC will be undertaken, subject to obtaining necessary statutory and other administrative approvals, said NLC.