Shimla: As Satluj Jal Vidyut Nigam (SJVN), the Shimla based public sector power generating company, prepares to go enter the equity markets through an IPO, status of 775 MW Luhri project on Satluj River remains uncertain even as field reports indicate that commissioning of the 412 MW Rampur project could be delayed by a year.
HK Sharma, CMD SJNVL told My Himachal News that SJVNL had entered into an memorandum of understanding for executing the 775 Luhri project wherein the centre and Himachal state would share a 51:49 equity in the specific project.
Since currently the central and state government hold a 75:25 equity ratio in SJVN that operates the countryâ€™ largest 1500 MW hydro plant and as the central government intends to sell 10 percent of its equity through the IPO, fears of the equity balance changing in Luhri project have arisen.
Sharma says that as execution of the project is still to start, issues of equity participation that were agreed upon in the MOU are being negotiated with the state government.
The government company could float a SPV for executing the project or could go for an alternate model so as not to upset the delicate equity balance in the project, he said.
He said that the share sale in the IPO would only be for the 1500 MW Jhakri project and the 412 MW Rampur project.
Even in Rampur project, where the equity ratio is 70:30 between the centre and state, the Himachal government has been asked to foot in additional Rs 40 crore as its increased share in equity.
Sharma disclosed that while the state has paid Rs 16 crore another Rs 24 crore was still due. SJVN has a capital base of Rs 4108 crore and additional Rs 40 crore raises it to Rs 4148 crore.
Speaking about the work on the Rampur project, the CMD said that the excavation of the head race tunnel had encountered some bad geology and was causing some delays.
He said that Rampur project which was earlier scheduled to be commissioned in 2012 could be delayed by a year and become fully operational in 2013.
Besides the Luhri project, others in the pipeline include 66 MW Dhaulasidh project, the 252 MW & 245 MW Devsiri I & II projects in Uttrakhand, the 402 MW Arun III project in Nepal and others. However, the Himachal government has withdrawn the 1020 MW Khab project from SJVN and decided to hand it over to HP Power Generation Corporation, instead.