Lanco plans 1000 Mw plant

The Lanco Group plans to set up a 1,000-Mw gas-based power project on the west coast in Gujarat.

According to sources, Lanco will join hands with Gujarat State Petroleum Corporation (GSPC) for the proposed project. The location and the time frame of the project would depend largely on the availability of gas in the Krishan-Godavari Basin on the west coast.

Lanco also plans to acquire coal mines in Indonesia to support fuel requirements of its ambitious Nagarjuna Power Project, which is scheduled to go on stream by 2009. The infrastructure company also plans to acquire some of the coal blocks in the country available for long lease to support the company's existing and future plans for coal-based power projects.

Industry sources close to the group confirmed that the company was in talks to acquire coal mines in Indonesia.

The company also plans to subscribe to 74 per cent of the equity of Nagarjuna project provided it achieves financial closure by March 31, 2007. The Rs 4,3242-crore Nagarjuna power project, which has a capacity of 1,015 Mw, has already been granted the mega power project status.

Besides, the group plans to increase its total power generation capacity from around 500 Mw to 3,500 Mw within the next three years where it will have a mix basket of gas, hydel and coal-based power projects.

For its Kondapalli power project located in Andhra Pradesh, the group has been looking for additional gas supply to overcome the shortfall. It has estimated its requirement at 1.46 million standard cubic metre per day (MCMD) of gas as fuel against which it receives around 1.3 mcmd from GAIL.

For the additional gas supply, the company plans to enter into a supply agreement with GSPC and also with Reliance Industries for their gas, which is expected to reach onshore from the K-G Basin by 2009.

Despite fuel-related hurdles, Lanco has achieved over 80 per cent plant load factor (PLF) and is bullish on the Kondapalli project. Lanco plans to increase its stake in the project from the present 33 per cent to around 60 per cent.