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Reliance’s SEZ power plant hits obstacle

Mon, Apr 6, 2009

SEZ

Writes to Haryana seeking intervention on gas availability

MUKESH AMBANI’S Reliance Industries Limited (RIL), which is setting up joint venture Special Economic Zones (SEZs) in Gurgaon and Jhajjar, has hit an obstacle.

Uncertainty has enveloped the proposed 2,100-MW gas-based captive generation power plant being planned for the Reliance SEZ following the Empowered Group of Ministers (EGoM) according priority to fertiliser units over power plants in the allocation of natural gas from RIL’s Krishna Godavari (KG) gas fields.

In a way, it’s ironical for RIL, which is not being allowed to use the natural gas from its own offshore gas fields.

Consequently, RIL has sought the intervention of Haryana government through its joint venture (JV) partner, the Haryana State Industrial and Infrastructure Development Corporation (HSIIDC), to take up the matter with the Government of India.

“The RIL wants the state government to step in and take up the issue with the Centre cogently , underscoring the fact that the captive power plant was central to the success of the SEZ project.

They want the Haryana government to push for altering the gas allocation,” said a top official, referring to a recent RIL communication in this regard.

State officials said they would take up the matter with GoI after the elections.

On being asked whether the power project had been put on hold, a representative of RIL’s Corporate Communication division said: “We cannot conceive the SEZ without the 2,100MW power plant. The broad picture is that the power plant cannot remain in a pause mode for too long. It has to come up as the state government cannot provide adequate power for the SEZ project.” Senior officials said the state government had already initiated the process of acquiring land for the captive power plant and RIL too had procured almost two-third of the land for the project. Besides, special purpose vehicles (SPVs) were created for implementing the SEZ projects — Reliance Haryana SEZ has already acquired about 7,000 acres in Jhajjar and has in possession 1133.52 acres in Gurgaon.

“After investing so much, the RIL would like to doubly ensure that they get gas supplies for the power plant,” said an official.

The 2,100-MW gas-based power plant was planned at Faizabad village (Pasaur) in Jhajjar district along with a sewerage treatment plant (STP) to ensure continuous water supply to the power plant. The land requirement for the power plant, STP and water pipe lines was estimated at 269 acres, 24 acres and 3.2 acres, respectively . Following a proposal by M/s Reliance Haryana SEZ Ltd for acquisition of 185 acres for the power plant, 24 acres for STP and 3.2 acre for water pipeline right of way , the state government has agreed to acquire this land.

In fact, last year the RIL had even proposed to POWERGRID for grant of longterm open access (LTOA) to transfer power from the proposed 2,100-MW power plant. The RIL had proposed that the quantum of power to be transferred from the 2,100-MW plant would be increased from 255 MW (peak) starting from 2010-11 to 1,300 MW by 2015-16.

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