NTPC explores JV for distribution

The state-run National Thermal Power Corporation NTPC has launched a massive exploratory exercise to pursue its plans in the now-opened ...

The state-run National Thermal Power Corporation NTPC has launched a massive exploratory exercise to pursue its plans in the now-opened power distribution sector after the notification of Electricity Act EA 2003.

NTPC, which has set a target of distribution of 2,000 mw by 2017 through its wholly owned subsidiary, NTPC Electric Supply Company NESC, has already held talks with Maharashtra State Electricity Board MSEB and new power entities in Punjab, Karnataka, Madhya Pradesh, Karnataka and Kanpur electric supply company.

Cairn Energy to produce gas from Gauri field by 8217;04

New Delhi: British energy firm Cairn Energy Plc is likely to begin production of about 40 million standard cubic feet of gas per day from its Gauri field discovered in offshore Gujarat by the second quarter of 2004. 8220;The company is investing 66 million in development of Gauri and production is expected to begin in April 2004,8221; Cairn energy CEO Bill Gammell said. The Gauri field in CB/SO-2 block in Cambay Basin is estimated to contain between 60 billion cubic feet and 200 bcf of recoverable gas reserves. PTI

NTPC8217;s distribution venture is part of its corporate plan which envisages a generation capacity of 56,000 mw and a turnover of Rs 1,40,000 crore by 2017. NTPC wants to gain 25 per cent share in traded energy and restrict its transmission forays to bulk customers. The Corporation also plans to become a Fortune 500 company and also among the top five in terms of market capitalisation in the Indian market.

Sources said that the company was looking at the formation of a joint venture JV with these entities with a 51 per cent stakes for gaining a management control. 8220;We propose to take over the assets of these entities which is totally different from the open access in distribution envisaged in the EA 2003. We have held preliminary talks with various State governments, state electricity boards SEBs and new companies though there has not been any final commitment,8221; sources said.

NESC was to sign a JV agreement with Kanpur Electric Supply Company. However, it had to be postponed in the wake of change in the government in Uttar Pradesh.

Sources admitted that most of the SEBs or new companies formed after the restructuring of SEBs have been studying the impact of EA 2003 and thus not prepared to give any assurances. 8220;The investment requirement for taking over distribution assets will be known only after these proposals are accepted. Its too premature to even hazard a guess,8221; sources said.

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Sources said that NTPC chairman C.P. Jain met the MSEB chairman Asoke Basak on October 10 with a proposal to form a JV for the distribution in revenue mobilising Pune and Navi Mumbai areas. MSEB, however, has declined to give any assurance on the grounds that MSEB has already launched its restructuring as envisaged under EA 2003 and it would be trifurcated.