Essar Energy to buy power project from Navbharat

MUMBAI: London listed, Essar Energy, is close at buying Navbharat’s power project in Orissa for close to Rs 200 crores, sources close to the development said. The thermal power project has plans of a 1050 MW capacity near Meramundali & Kharagprasad villages in Dhenkanal District, Orissa. (Watch)

The power project has been accorded a coal linkage by Coal India. It has got a joint allocation of coal block at Rampia & Dip side of Rampia in the state of Orissa. Navbharat Power has also acquired environment, forest clearances for the project. Other requirements of a coal-based power project like water, railway connectivity have all been arranged.

In the first phase the project includes a 1050 MW thermal power plant which can be expanded with an additional 1200 MW power generation capacity. Sources say, Essar plans to scale up the project later, currently, Essar is also said to have approached the banks for a debt of Rs 4000 crores for the project.

Essar Energy is yet to respond to an e-mail query sent by ET Now. Nav Bharat Group has declined to comment on the deal, though, sources say that Malaxmi has already sold their 50% stake in Navbharat Power to Essar Energy.

Navabharat Power Private Limited is the Special Purpose Vehicle formed by Malaxmi & Nava Bharat Ventures Limited to establish a 2250 MW, Malaxmi Mega Thermal Power Project in Dhenkanal district, Orissa, India.

Power experts say, “Such projects with coal linkage and clearances make a good buy as these clearances are time consuming and cumbersome processes.” Like Navbharat, Bhadrawati power project owned by Vinod Mittal is also up for sale and has attracted interest from various power companies.