Adhunik Power to begin phase I of Jharkhand project in 2012

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Adhunik Power to begin phase I of Jharkhand project in 2012

Adhunik Power and Natural Resources has received the environmental clearances for its Jharkhand project. It is now building 540 MW (megawatt) coal-fired independent power producer (IPP), said Arun Kedia, CFO of Adhunik Power in an interview with CNBC-TV18.

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Adhunik Power and Natural Resources, a subsidiary of Adhunik Metaliks has received environmental clearances for its Jharkhand project and is now building 540 MW (megawatt) coal-fired independent power producer (IPP), said Arun Kedia, CFO of Adhunik Power in an interview with CNBC-TV18.

"Out of this 540 MW, the first 270MW is scheduled to come onstream in January 2012 and the next 270 MW, another three-four months later," he added.

Citing the company's future plans, he said, "If we start generating power in early 2012, maybe in 2013, we will look for listing this company."

Below is the verbatim transcript of Kedia's interview with CNBC-TV18's. Also watch the accompanying video.

Q: Can you tell us if all the environmental clearances are in place for this Jharkhand project?

A: We have all the clearances in place for the Jharkhand project and are currently building 540 MW (megawatt) coal-fired independent power producer (IPP).

Q: What is the timetable for that 540 MW and for the next phase?

A: Out of this 540 MW, the first 270MW is scheduled to come onstream in January 2012 and the next 270 MW, another three-four months later. We have now started working on next expansion, so the next one which we start today will take about three or three-and half years to come up.

Q: What about the coal linkages for the 270 MW into two plants at Jharkhand, are you completely tied up in-house for coal?

A: Yes, we have a captive coal block allocated for 540 megawatt capacity and this is a block named as Ganeshpur, which is in Palampur district of Jharkhand. This block is having 140 million tonne of coal, which we share 50-50 with Tata Steel . We are actively working on developing this coal block along with Tata Steel.

Tata Steel is the designated leader of this block so, on paper, it is their responsibility to develop this coal block. But, coal is an important resource for us and we are working hand-in-hand with them. As per the current plan, this coal block should start producing coal from September or October 2012.

Q: Can you tell us a bit about the structure of Adhunik Power, how much does Adhunik Metaliks own and how much the other equity partners hold in this particular company and do you plan to list this company at some point in time?

A: The present equity structure is the Adhunik Metaliks and its subsidiary Orissa Manganese and Minerals together hold about little higher than 60% i.e. 60.5%. The other 39.5% is split between IDFC Project Equity, which holds 27.5 and about 12.1% is held by SBI Macquarie Infrastructure Fund.

Together they have agreed to put in Rs 375 crore out of the total equity requirement of Rs 663 crore for this project. It is 60:40 between Metaliks and the outside investors.

Q: When do you plan to list it?

A: In terms of the agreement with investors, we have a five year time horizon to list the company. But, our plan is to list it about a year after we achieve commercial production. If we start generating power in early 2012, maybe in 2013, we will look for listing this company.