Green panel defers decision on NMDC's power plant proposal

HYDERABAD: A committee under the Ministry of Environment and Forests has deferred its decision on state-run NMDC's plan for setting up a 500 MW power plant in Uttar Pradesh on the grounds that the place where the project is proposed to come up is a fertile agriculture land.

The committee also suggested that the Ministry to delist the proposal from the pending list as "exploration of alternatives sites may take a long time".

NMDC Power Ltd, a subsidiary of the miner, approached the Ministry for clearances to set up 2x250 MW coal-based thermal power plant at Yankapur village in UP's Gonda district with an investment outlay of Rs 3,000 crore.

Gonda district is known for fertile agricultural land and NMDC Power is advised to explore alternative acceptable sites beyond Gonda, according to the minutes of the meeting of EAC held last month.

"In view of the above, the proposal was deferred for re-consideration at a later stage and it was recommended that that the Ministry may de-list it from the pending list as exploration of alternatives sites may take a long time," the EAC said in its observations.

NMDC officials were not available for comments. NMDC Power will initially hold 48 per cent stake in the venture for setting up the 500 MW plant, while the remainder will be with IEDCL, a subsidiary of IL&FS.

Subsequently, NMDC would dilute its stake in the venture to 26 per cent, while IEDCL would have the rest 74 per cent stake, NMDC acting Chairman C S Verma had said at the MoU signing ceremony in August.

He had also said that the project would be funded in a 2:1 debt-equity ratio and though NMDC would gradually pare down its stake to 26 per cent, it would never exit from the project.

Gonda is the Parliamentary constituency of Union Steel Minister Beni Prasad Verma.