Singareni to set up 600 Mw power plant

State-owned Singareni Collieries Company Limited (SCCL), a Rs 4,500-crore turnover coal mines player in Andhra, is foraying into power generation.

The company is setting up a merchant power plant of 600-Mw capacity at an investment of Rs 2,400 crore. The project is scheduled to be completed by the year 2011.

S Narsing Rao, chairman and managing director, SCCL, said the detailed project report (DPR) for the proposed plant would be ready by March 2008.

"Since we are a profitable company, achieving finance closure will be not be a problem," he told the media. It is expected to raise funds in the debt/equity ratio of 20:80.

The company is hoping to post a higher net profit in the range of Rs 125 crore this year as compared with Rs 94.96 crore as the coal production had registered a 14.3 per cent growth in the nine-month period ending December 2007.

The company achieved a production of 29.83 million tonne coal in the first nine months of the current financial year.

With regard to coal mining, Singareni would develop 27 new mines at a total capital expenditure of Rs 3,600 crore during the Eleventh Plan period, according to Rao. Meanwhile, the company is planning to acquire SMS Explosives of IBP at about Rs 5 crore to ensure continuous supply of explosives for its mining operations.

On the revision of coal prices in the wake of Coal India Limited's recent move, Rao said the company was evaluating the pricing issue.