KSK Mahanadi Power Co Ltd

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KSK Mahanadi Power Co Ltd was an SPV created to develop and operate a 3600 MW power plant at Nariyara, Chhattisgarh. The project consisted of six units of 600 MW each, and to be located in Nariyara village, Akaltara Tehsil, Janjgir-Champa district, Chhattisgarh. This power project of 3600 MW was setup in a single location and was scheduled to be commissioned on a unit-wise basis through 2012 and 2013. The KSK Mahanadi Power Project was designed to utilize coal as its primary fuel, and consist of steam turbine generator units, along with its boilers and plant. The coal based power project was approximately 125 kilometers from the Morga II coal block in Chhattisgarh. The original project was a 1,800 MW power project based on coal supplies from the Morga-II coal block by Gujarat Mineral Development Corporation (GMDC). With the availability of additional fuel from the Gare Pelma Sector III coal block in Chhattisgarh, the KSK Mahanadi Power Project expanded through the fast track development of an additional 1,800 MW of power generation capacity in the same location. KSK Mahanadi entered into a coal supply contract with the GIDC, for supplies from Gare Pelma Sector III coal, which would be valid for 30 years from the date of commencement of coal supply by GIDC. KSK Power Ventur Plc owned 100% of KSK Mahanadi Power Co Ltd, which was the largest power project pursued by the KSK Group until 2010. The project sponsor signed a Power Purchase Agreement (“PPA”) for the long term supply of 1010 MW of power from this power plant with Gujarat Urja Vikas Nigam Limited (“GUVNL”), the state-owned holding company for electricity companies in Gujarat, in June 2010. In February 2009, the KSK Mahanadi Power Project selected Shangdong Electric Power Construction Corporation (SEPCO), a leading EPC contractor from China engaged in power plant design and construction, as the contractor to undertake design, supply and provide engineering and construction services for the KSK Mahanadi power project. Under these agreements, SEPCO was to supply the KSK Mahanadi with necessary equipment and materials and render such services as are required for the plant to generate aggregate power of 3,600 MW. The project cost was estimated to be US$ 3535.3mn. Financial closure took place on 20th November 2010. Financing comprised INR 161.9bn senior-debt and INR 32.38bn sponsor equity. Senior-debt comprised an INR 121.42bn 16-year 5-months term loan arranged by SBI Capital Markets and IDBI. The term financing paid interest of 4.75 percentage points more than State Bank of India’s base rate. The other lenders in the syndicate were Andhra Bank, Axis Bank Ltd., Bank of India, Bank of Baroda, Canara Bank, Federal Bank and Housing & Urban Development Corp. of India. Further, in July 2011, KSK Energy financed 16-year 6-months sub-debt component of USD 172.3mn (INR 8100mn @47 INR/USD). The project was scheduled to be commissioned on a unit-wise basis through 2012 and 2013.