Haldia Energy Limited

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On 22nd April 2010, the West Bengal Government, signed a MoU with Calcutta Electric Supply Corporation Limited (CESC of RPG Group) for development of a 600 MW (2 units of 300MW each) coal-fired supercritical thermal power plant at Jhikurkhali Village of Baneswar at Haldia, East Medinipur District, in West Bengal. CESC through its 100% subsidiary Haldia Energy Limited would execute this project. The land required of 297 acres for the project has been acquired.HEL had received all major clearances including environment clearance. HEL was also responsible for any transmission infrastructure to connect the power project to the designated substation. The primary fuel for the project was domestic coal. Mahanadi Coalfields Limited had committed to supply the domestic coal. Given the production shortfall currently affecting the coalfields of Coal India Limited (MCL is subsidiary of CIL), this means that on an average 60-70% of the coal requirement may be satisfied by MCL. Haldia Energy Limited was expected to import coal, and was scouting for coal sources globally. The company had awarded contracts for Boiler-Turbine-Generator (BTG) to Shanghai Electric (September 2011), BOP (Balance of Plants) to Punj Lloyd.The order for supply and construction of 400 kV Double Circuit river crossing transmission line between Haldia Thermal Power Plant – Subhash Gram, crossing the Ganges River at Kolkata (West Bengal) was given to KEC International (another RPG group company). The contractual completion time for the transmission infrastructure was approximately 18 months. The power generated from the project of 600MW was primarily expected to be sold to the state owned utility company - West Bengal State Electricity Distribution Company Ltd (WBSEDCL).While the details of the PPA couldnot be ascertained, analyst reports indicate that 75% of the power output (450MW) would be sold to WBSEDCL at a tariff determined by West Bengal Electricty Regulatory Commission. The rest 25% (150MW) was expected to be sold on merchant basis. The cost of the Project (600MW) was estimated to be approximately USD 725.1 million (INR 34080mn @47 INR/USD). Financial close took place on 10th August 2011 at a Debt/Equity ratio of 75/25. CESC financed this project through an equity contribution of USD 181.5mn (INR 8530mn) and a debt of USD 543.6 mn (INR 25550mn). The debt had a door-to-door tenor of 14years 9months.The repayment had a grace period of 1year and would be paid in 43 quarterly instalments. IDBI Bank (INR 11050mn) and ICICI Bank (INR 11050mn) equally provided for the term loan. The construction for the project was expected to start in September 2011 and was expected to be progressively commissioned by March 2015.