Bharat Heavy Electricals
Ltd has
begun the process
of winding up its
joint venture with Tamil
Nadu Electricity Board
meant for setting up the
2x800-MW Udangudi
supercritical thermal
power project in the southern
state.
In October 2007, the two
partners had come together
incorporating the joint
venture Udangudi Power
Corporation Ltd to implement
the
8,500-crore
project taking shape at
Udangudi in Thoothukudi
district. Both partners held
26 per cent equity while
the remainder was to come
from financial institutions.
The Udangudi project
did see some progress, but
not significant, since the
signing of the JV agreement.
The Tamil Nadu
government had alienated
land, coal linkages were in
process and major preproject
consultancy mandates
were awarded. The
project had also secured
environmental clearances
and the PPA between
Tangedco and UPCL was
also signed, according to
information available from
reliable sources. However,
at the time of signing of
MoU, unit-I of 800-MW
was envisaged to commission
before March 2012.
In February, TNEB
decided to end the partnership
with BHEL and
expressed that it would
implement the project on
its own. The power utility,
according to reports, had
cited "lack of co-operation
from BHEL" as the reason
to part ways. BHEL subsequently
requested TNEB
to reverse its decision but
that did not happen.
For BHEL, this development
could be considered
as a setback since it was
amongst the company's
early attempts in establishing
itself as a developer
of power projects, rather
than just an equipment
supplier. With the JV now
on its way to dissolution,
BHEL has another chance
to see itself groom as a
power developer, through
the JV that is with Karnataka
Power Corporation
Ltd. In January 2009,
BHEL and the Karnataka
power utility entered into
an agreement to form a
joint venture that would
develop the 2x800-MW
Raichur supercritical thermal
power project at Bellary.
The project in which
BHEL is a minority partner
with 26 per cent is
under execution.
It may be recalled that
BHEL sustained a big
blow in its capacity as
equipment supplier when
Rajasthan Rajya Vidyut
Utpadan Nigam rescinded
a
12,200 crore order
that it had placed on
BHEL. The order for supplying
supercritical boilers
and TG sets for two of
RVUNL's projects—Suratgarh
(2x660-MW) and
Chhabra (2x660-MW)—
was placed in January
2011. BHEL had won the
order through the international
competitive bidding
(ICB) route.
According to information
compiled by Projectmonitor,
BHEL has a current
outstanding order of supplying
supercritical-grade
power equipment for
8,520 MW worth of projects,
now excluding the
Udangudi project.