NLC-Tamilnadu Power signs loan pact with BoI consortium

NLC-Tamilnadu Power Limited, a joint venture promoted by Neyveli Lignite Corporation Limited and Tamilnadu Generation and Distribution Corporation Limited (Tangedco), has signed a rupee term loan agreement for Rs 937 crore with a consortium led by Bank of India.

The JV is executing a 1,000-Mw (2 units 500 Mw) coal-based thermal power station at Tuticorin in south Tamil Nadu adjacent to the existing thermal power station of Tangedco. The equity participation of NLC-Tangedco is in the ratio of 89:11. The Centre had sanctioned the project in May 2008 with a debt-equity ratio of 70:30 and with an estimated cost of Rs 4,909.54 crore. A consortium of bankers led by Bank of Baroda had lent Rs 2,500 crore to the project in 2010.

Towards the balance debt requirement, the JV signed the loan agreement with the Bank of India consortium, which has two other member banks — Indian Bank and Central Bank of India.