NMDC to set up 500-MW plant at Gonda

Company will invest about Rs 3,016 cr on the project and has roped in IEDCL as a partner for the project

Making its maiden venture into thermal power generation, state-owned iron ore miner NMDC will set up a 500-MW power plant at UP's Gonda.

The company would invest about Rs 3,016 crore on the project and has roped in IL&FS Energy Development Company (IEDCL) as a partner for the project, giving it a 74% stake, sources said.

Both the companies would sign a memorandum of understanding (MoU) for the project here tomorrow.

Gonda is the Parliamentary constituency of Steel Minister Beni Prasad Verma and NMDC comes under his ministry.

The power plant will consist of two units of 250 MW and about 300-350 MW electricity will be used at NMDC's upcoming 3 million tonnes steel mill in Chhattisgarh's Nagarnar, which is more than 1,100 km away from Gonda, Uttar Pradesh.

The plant will be spread over a total area of 600 acres in Turkadih in the Gonda District, sources further said, adding that balance 150-200 MW power from the plant would be used for plugging the demand-supply gap of the state.

NMDC Power, a wholly-owned subsidiary of NMDC, will hold remaining 26% stake on behalf of the iron ore miner in the project.

NMDC is hoping to secure the statutory clearances well in time for the project as all construction activities will be confined within the plant premises and there will not be any physical change outside the project boundary in terms of existing land, vegetation and buildings.

The power plant would require either 1.988 million tonnes per annum (MTPA) at 85% PLF (plant load factor) or 2.10 MTPA at 90% PLF, depending on the efficiency of the plant.

For the project, NMDC is planning to source E/F grade coal from Northern Coalfields Ltd, a subsidiary of Coal India. It may also supply C grade coal, which contains higher calorific value, from its Shahpur East and West coal blocks in Madhya Pradesh.

The coal blocks were allocated to NMDC in 2007 under government dispensation route for commercial mining.

NMDC's Rs 15,525 crore steel plant in Chhattisgarh, its maiden venture in the sector, is scheduled to be commissioned in 2015.The plant would require about 420 MW power to run its different units.

Of this, 70 MW would be generated in the plant itself, while rest would be sourced from the Gonda power plant or from other sources like the Western grid or Chhattisgarh State Power Distribution Company Ltd.