Bina Power Supply Company

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In May 2008, Jaypee group company, Jaiprakash Power Venture (JPVL), had acquired Bina Power Supply (BPSCL) from the Aditya Birla Group for about USD 3 million (INR 150-175 crore). Aditya Birla Group had formed BPSCL in the early 1990s to develop a 1,000 mw power plant (in two phases of 500 mw each) at Bina in Sagar district of the state of Madhya Pradesh, but didn’t pursue it after the initial progress. BPSCL had received government approvals for the power project, which was later cancelled. The Bina project was spread over 1,600 acres and had earlier obtained coal linkage for 500 mw, which was cancelled after the project failed to take off. JPVL approached the Government and later revived all the clearance applications and obtained it over the years 2007-2008. Land covering about 694 hectares is already in possession. Letter of assurance by Coal India Limited for capacity of 500 MW has been obtained. 100 cusecs of water from river Betwa in Madhya Pradesh has been assured by the government. Evacuation of power from the Power Plant shall be done by PGCIL. BPSCL was granted the project through MOU route on a negotiated basis. Post revival of the project, JPVL had signed a 25-year PPA with Government of Madhya Pradesh for the offtake of 70% (175MW, 5% of this contracted power will be sold to GoMP at variable cost.) of the installed capacity for Phase-I (250MW) and balance power (75MW) would be sold on merchant basis. The tariff would be as determined by MPERC (State Electricity Regulator) on annual basis. Fuel costs were to be recovered on a pass-through basis. BHEL has been given the Boiler Turbine Generator (BTG) contract while Jaiprakash Asssociates would carry out the civil works for the project. The project cost was initially estimated to be approximately USD 568.9 million (INR 27540 million @ 48.41 INR/USD). BPSCL financed this project through an equity contribution of USD 170.6 million (INR 8260 million @48.41 INR/USD) and a loan of USD 398.3 million (INR 19280 million @ 48.41 INR/USD). The project has been funded in a debt: equity ratio of 70:30. In November 2009, the funds were arranged by IDBI Bank in consortium with Punjab National Bank, Central Bank of India, Union Bank of India, Canara Bank, State Bank of Hyderabad, J&K Bank, Bank of Rajasthan, State Bank of Patiala, and Allahabad Bank. Because of cost-overrun owing to delays, additional financing of USD 90.9mn (INR 4860mn @ 53.44 INR/USD) was executed in June 2012. This comprised of a 11-year 6-months term loan of USD 61.7mn (INR 3300mn) and sponsor equity of USD 29.2mn (INR 1560mn). IDBI was the lead arranger and other particpating banks were Central Bank of India (1000mn), Punjab National Bank (650mn), State Bank of Patiala (300mn), Jammu & Kashmir Bank (300mn), and Union Bank of India (300mn). Main plant civil works started on 27.11.09 by M/s Jaiprakash Associates Ltd. Commissioning of Phase-I was done in August 2012 and Phase-II was expected to be commissioned in March 2013. Additional financing in June 2012. 250MW operational in August 2012. Project description changed to take care of additional information.