Tata Power acquires SPV for Mundra ultra mega power project
24 April 2007
The
signing of the share purchase agreement, escrow agreement,
hypothecation agreement, and port service agreements,
by PFC, bankers, procurers and Tata Power, now allows
the company to go ahead with the various project development
activities.
Tata Power had provided a performance bank guarantee of
Rs300 crore to PFC.
Coastal Gujarat Power Ltd has also signed power purchase agreements (PPAs) with seven procurers (distribution licensees) for the sale of contracted capacity and supply of 4000 MW electricity to these licensees but it delineates responsibility of procurers and Company for the next important milestone. It also nominates Gujarat Distribution Company as the lead procurer on behalf of all procurers.
Speaking on the occasion Prasad Menon, managing director, Tata Power, said, "This acquisition is a significant milestone towards progress on Mundra ultra mega power project. We continue to look forward to the support of ministry of power and government of Gujarat for all necessary clearances required for the project".
This development follows the recent announcement made by Tata Power for acquisition of 30-per cent equity stakes in two major Indonesian thermal coal producers, PT Kaltim Prima Coal and PT Arutmin Indonesia as well as related trading companies owned by PT Bumi Resources Tbk. (See: Tata Power to acquire 30-per cent stake in $1.3-billion Indonesian coal mines)
The acquisitions specifically addresses fuel requirements for Mundra UMPP, Trombay and coastal power project in Maharashtra and is complimentary and supports the assumptions made in the bid for Mundra UMPP.
The government of India had announced the implementation of several Ultra Mega Power Projects through an International Competitive Bidding process and is the largest ever bid based project initiative to be executed in India as well as abroad. The Company had submitted its Expression of Interest for four UMPPS (out of four, bidding process for the two UMPPs is still pending).
