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Thursday, October 21, 2010

NTPC to set up two coal-based power plants in Bangladesh - Proposes to set up equal JV with Bangladesh Power Development Board


As part of India’s efforts to improve ties with Bangladesh, NTPC Ltd plans to set up two imported coal-based power projects totalling 3,960MW in the country.India’s largest power generation company proposes to set up an equal joint venture with the Bangladesh Power Development Board to develop the two projects at an estimated cost of Rs. 23,760 crore.

“We have been assigned to do the feasibility report of two projects in Chittagong and Khulna,” said NTPC chairman and managing director Arup Roy Choudhury.
Khulna is the parliamentary constituency of Bangladesh’s Prime Minister Sheikh Hasina. The project here will start before the one in Chittagong.

Mint reported India’s initial proposal for the two projects on 17 February. The proposal was discussed at a meeting of a joint steering committee of the two countries. The plan follows Hasina’s visit to India in January, during which the two countries moved to enhance their bilateral relationship.
India wants to cultivate closer ties with Bangladesh so that the government in Dhaka will act against militant anti-India groups that have set up bases there, such as Harkat-ul-Jihad-al-Islami, Jamaat-ul-Mujahideen, Purbo Banglar Communist Party, Bipplobi Communist Party and the Sarbahara Party.
Bangladesh wanted both power projects to be developed near ports. The Khulna plant will have a capacity of 2,640MW, making it one of the largest power generation projects in the country. It will be executed in two phases. Depending on Bangladesh’s demand for power, there may be a third phase as well.
The Chittagong project will start with an initial capacity of 1,320MW that may later be expanded. The neighbours signed a memorandum of understanding on this last month.
“Improvement of the power situation is one of the most important priorities of Bangladesh,” said Enamul Hoque Chowdhury, minister (press) at the Bangladesh high commission in New Delhi. “If the NTPC projects are implemented in the next two or three years, it will help in reducing the power deficit.”
Bangladesh has an installed capacity of 10,000MW, compared with India’s 164,835MW.
Power production is related to broader development and socio-economic growth, Chowdhury said, as every investment in the industrial sector requires power.
He said Hasina had made power generation her government’s top priority too. “This was her No. 1 election promise—to improve the power situation in the country and reduce our growing demands.”
India has also proposed to set up of a liquefied natural gas (LNG) terminal as a joint venture in Bangladesh to create a power generation capacity of around 1,000MW, as reported by Mint on 2 April.
NTPC is scouting for renovation and modernization, and operation and maintenance opportunities in Bangladesh too, and has bid for the 300MW Siddhirganj gas-based power project.
Power Grid Corp. of India Ltd is setting up a transmission link between the two countries. The 250MW grid interconnection requires an investment ofRs.869.21 crore, of which Rs.160.33 crore is needed for infrastructure on the Indian side.
“India has a two-pronged strategy in Bangladesh. One is to help them in running their existing projects and the second is to partner with them for setting up generation capacities,” said a senior power ministry official, who did not want to be identified.
NTPC, which has a power generation capacity of 32,194MW, plans to increase its installed capacity to 75,000MW by 2012. The utility posted a net profit of Rs.8,656.53 crore in the 2010 fiscal on revenue of Rs.45,255 crore.
India has also been trying to secure gas supplies in its immediate neighbourhood and has been trying to engage countries such as Bangladesh and Myanmar. Bangladesh, which has substantial reserves of 135.8 billion cu. m, has resisted calls until now for exporting the fuel to India.

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