Coal news and updates

Odisha Power Generation to select MDO soon for coal mines

After winning back the Manoharpur and dip side of Manoharpur blocks, state owned Odisha Power Generation Corporation (OPGC) aims to select the mine developer cum operator (MDO) soon for extracting coal from these mines.

"Work order for a Merry Go Round System (MGR) for the coal mines has already been issued. We hope to select the MDO soon from the open market for developing and operating the mines," said OPGC chairman and principal secretary (energy), Suresh C Mahapatra.

OPGC had originally won the Manoharpur and dip side of Manoharpur blocks but lost them after a Supreme Court scrapped licenses of 204 coal blocks in May last year. In March, the state regained these coal blocks under the PSU dispensation route. The coal blocks were awarded to Odisha Coal & Power Ltd (OPCL), a 51:49 joint venture (JV) between OPGC and another state entity Odisha Hydro Power Generation Corporation (OHPC).

OCPL was floated by the state government since OPGC having 49 per cent equity by a private player (US-based AES Ltd), was not eligible for securing a coal block under the PSU dispensation route. The Coal Ordinance (now Coal Mines Special Provisions Act) demanded that a government company need to have at least 74 per cent stake in a JV for being eligible to get a coal block.

"OCPL hasn't started formally functioning yet. The bank guarantee has been submitted in respect of the allocated coal blocks. OCPL will operate like a mining company on the lines of Odisha Mining Corporation (OMC). We will soon take a call on the modalities of the functioning of OCPL," Mahapatra said.

OPGC runs a 420 Mw (2x210) plant presently at its Ib valley complex. The expansion plan would add 1,320 Mw capacity to the power station. The expansion is being taken up at a cost of Rs 11,547 crore which also includes cost of other components like coal block development and dedicated rail corridor.

The state owned generator has already started construction work on the expansion project. To fund it, OPGC has tied up funding of Rs 8,660 crore from Power Finance Corporation (PFC) and Rural Electrification (REC) by executing a loan agreement with them. The balance fund is to be borne proportionately by the Odisha government and AES which hold 51 per cent and 49 per cent stake respectively in OPGC.

Power equipment major Bharat Heavy Electricals Ltd (BHEL) has bagged Rs 4,051 crore contract from OPGC for supply and erection of the main plant for 1,320 Mw additional capacity.

source: http://www.business-standard.com