Essar ties up funds for power project

MUMBAI: Essar Power, the utility arm of the Essar group, on Thursday said it has tied up the debt required for the Rs 4,860 crore, 1200 megawatt thermal power plant that Essar is building in Mahan, Madhya Pradesh.

The thermal power project has a debt-equity ratio of 3:1 with the debt funded by a consortium of lenders including ICICI, Power Finance Corp, REC and PNB.

ET had earlier reported that Essar Power would be building four power plants at a total cost of Rs 20,000 crore. The Mahan thermal plant is part of the four proposed power plants that Essar Power is building, that will raise its total electricity generating capacity to 6,000 mw by 2012. Essar Power currently has a total capacity of 1,200 mw.

The move is in line with the current trend among banks to lend to core and infrastructure sectors. The Essar group already has a joint venture with Hindalco Industries for coal mining at Mahan.