NLC-Gujarat government to build 1,500 MW lignite based power plant

Chennai: The Neyveli Lignite Corporation Limited (NLC) and the government of Gujarat has signed an memorandum of understanding (MOU) to set up a 1,500 MW lignite based power project near Surat. The two-phased Rs7,500 crore integrated project will have a lignite mine cum power plant.

In the first phase of the project, the mine and power generation capacity will be of 8 million tonne and 1,000 MW respectively. In the second phase, the mining capacity will go up by 4 million tones, while power generation will increase by 500 MW.

The MOU was signed in the city on 28th July 2006 by S Jayaraman, chairman and managing director, NLC, and Balwant Singh, principal secretary, Energy, Gujarat government, in the presence of the Gujarat chief minister Narendra Modi.

A joint venture company will be floated for implementing the project, which is expected to go on stream in five years time. While NLC is expected to hold 74 to 89 per cent stake in the proposed company, the Gujarat government will hold the balance.

According to Jayaraman, NLC has expansion projects in Orissa, Rajasthan and Tamil Nadu. The corporation has started preliminary work on another integrated project - mine cum power plant- at Jayamkondan, Tamil Nadu. The project will generate 1,000 MW initially and later increase the generation to 2,000 MW. Presently NLC mines 24 million tonne of lignite and generates 2,490 MW at Neyveli.

Speaking about Gujarat's power scenario, Modi said, the state generates 9,300 MW and does not have any power cuts. All the 18,000 villages in the state have three phased power connection.