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RIL to set up 4,000 Mw capacity for Rs 10,000 cr

Rakteem Katakey  |  New Delhi 

To leverage its gas from the Krishna-Godavari (K-G) basin, Reliance Industries Ltd (RIL) is planning to set up 4,000 Mw of gas-based power generation capacity at multiple locations at an investment of Rs 10,000 crore, in addition to a mega fertiliser plant at Kakinada in Andhra Pradesh.
Around 1,000 Mw capacity will come up at Jamnagar in Gujarat, where RIL is building a 27 million tonne per annum (mtpa) refinery alongside its existing 33 mtpa refinery.
"Besides Jamnagar, around 3,000 Mw capacity will come up at the two special economic zones in Maharashtra and Haryana. The Haryana project is in advanced stages," a company official said, without giving a time frame for the projects.
Incidentally, the country's largest private sector power utility "" Tata Power "" has an installed capacity of about 2,300 Mw today.
Typically, gas based plants cost about Rs 3.5 crore per Mw, though RIL is working on a cost estimate of Rs 2.5 crore by using new turbines.
The capacities may vary slightly as the company still has to study the kind and number of industries that will come up at the SEZs, the official added.
For firing the power plants the company is assured of 25 million cubic metres per day (mcmd) of gas for captive consumption from the K-G basin block.
"We will use the portion of gas marked for our captive use for the power plants and petrochemical complex and refineries," the company source said.
Power from the plants is also likely to be sold to group company Reliance Retail to light up its stores.
As for the fertiliser plant at Kakinada, which is the landfall point for its gas from the D6 block in the Krishna-Godavari basin, it would "help reduce costs for the plant as transportation tariff and taxes on the gas will not be charged," a company official said.
RIL has come under attack from both the fertiliser and power industry after it set a well-head price of $4.33 per million British thermal unit for its K-G gas which leads to a landed price of about $6 in north India.
The fertiliser and power say that the cost of gas would be too high, making operating on gas economically unviable.
Moreover, the company's gas is locked up with power utility NTPC and Anil Ambani promoted Reliance Natural Resources with the Bombay High Court saying RIL cannot sell the gas to any other company. The court, however, has allocated RIL 25 mcmd of gas for its captive use.

Also Read:

Govt gets HC nod for fixing RIL gas price

No dearth of customers for RIL's KG basin gas

RIL strikes gas in Gujarat, K-G basin

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First Published: Wed, July 25 2007. 00:00 IST