OPGC expansion to start in 2011

The American utility major AES, which holds 49 per cent stake in Orissa Power Generation Corporation (OPGC), today announced that the long pending 1320 Mw expansion work of OPGC will start in the first quarter of 2011.

The Engineering Procurement and Construction (EPC) tender for the expansion would be floated within next three months.

“We are in the process of getting bids for procurement of low cost equipments for the project and the Engineering Procurement and Construction (EPC) tender is likely to be floated within next three months”, Paul Hanrahan, president and the chief executive officer (CEO) of AES Corporation said here.

Talking to media after meeting chief minister Naveen Patnaik in the state secretariat, Hanrahan said, the company is focusing on the second phase expansion of OPGC located at Ib valley in Jharsuguda district. The expansion comprises installation of two super critical units (unit 3 and 4) of 660 Mw each at an investment of about Rs 10,000 crore.

The AEC chief said, the state government is providing required support for the project and hoped that the contentious issues between the company and the state government would be resolved amicably.

Sources said, the government is keen to ensure transparency in bidding and evaluation process for the project. Prior to the meeting with the chief minister, the government and AES officials had several rounds of detailed discussions on how to take the project forward.

OPGC also made a presentation before the chief secretary on possible models which can be adopted for tendering. During the discussion with AES, the energy department officials are reported to have asked the former to make a comparison of similar biddings done in other states and follow the advisory by the Central Electricity Authority (CEA) in this matter.

After the details are submitted by AES, the OPGC board would take a view on packaging and procurement of Chainese equipments for the project. However, sources maintained that there wouldn’t be any funding problem for the expansion as Power Finance Corporation (PFC) and Rural Electrification Corporation (REC) have agreed to finance it.

Given the BTG (boiler turbine generation) and the main plant package at about Rs 2.8 crore to Rs 3 crore per Mw and the Balance of Plant (BoP) at about Rs 1.2 crore to Rs 1.6 crore per Mw, the cost of the main plant is estimated to be about Rs 4000 crore.

It may be noted, the project has been allotted two coal blocks at Manoharpur and Dipside Manoharpur in Ib Valley sector of Mahanadi Coalfields Ltd (MCL).