Setback for Suzlon as ONGC defers MoU

Setback for Suzlon as ONGC defers MoUONGC has decided to defer the MoU with Suzlon Energy Limited in view of the reports of its financial instability in the media. ONGC was pursuing the collaboration for development of Offshore wind energy projects. However, it has now decided to identify a partner through Expression of Interest (EOI) route.

At a recent Board meeting, it was noted that ONGC has high synergy with offshore wind energy as it is operating offshore exploration and production projects and has expertise in managing execution of such projects for the last 40 years. However for exploitation of offshore wind energy, it needs to partner with an established player who has significant presence in wind energy, including offshore. Accordingly with a view to achieve the above objective, it was gathered from the information available in public domain that Suzlon Energy Limited has a subsidiary REpower, which is a leading offshore wind turbine manufacturer with presence in China, Germany, Canada and USA.

Accordingly, a dialogue was initiated with Suzlon for possible collaboration to explore the possibility of partnering for offshore wind energy development in the country as both the companies are leaders in their respective domains. Accordingly based on the outcome of high level discussions and interactions between ONGC and Suzlon Energy, a draft MoU was also prepared.

However, at the meeting, it was brought out that even though Suzlon Energy Limited (SEL) is the market leader in Wind Power, considering the reports of financial instability of Suzlon Energy appearing in the media and the need to have further due diligence on the overall capability of SEL, it would be advisable to defer execution of the MoU with Suzlon Energy at present. It was further suggested that a suitable partner may be selected through EOI route. The Board agreed to the suggestion and directed that the proposal may be examined afresh and also to identify a prospective partner through EOI route.

ONGC intends to set up Wind and Solar farms up to 2 GW and 1.5 GW respectively by 2030. Currently it has a 51 MW wind farm operational in Gujarat since 2008 and another 102.9 MW wind project is under implementation in Rajasthan.

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