Message Sam 8 Mar 2014 10:46

Nava Bharat Ventures to Invest $1 bn to Expand Power Busines

Nava Bharat Ventures to Invest $1 bn to Expand Power Business
By Sunitha Natti - HYDERABAD Published: 07th March 2014

Diversified power, coal mining and ferro alloys major Nava Bharat Ventures Ltd will invest over $1 billion to develop natural resources and power generation in next 2-3 years.

Of the proposed $1 billion, $700 million has been earmarked for a 300-mw coal-fired power project in Zambia, $100 million to revive coal mining at Maamba coal mine, Africa and $235 million to develop a 150 mw hydro-electric power project -- Kobe Green Power Ltd, Japan.

According to company sources, financial closure for the Zambia power project is expected by June. Of the $700 million, $560 million comprises loan component and the project is scheduled to takeoff in Q4, FY2015.

“About 65 per cent work on Maamba Collieries Ltd, has been completed and we have entered into power purchase and transmission agreements with Zambian State power company Zesco for the 300 mw,” an official told Express.

The company was in the process of reviving coal mining at Maamba Collieries Ltd. Nava Bharat, which acquired 80 per cent stake in Kobe Green Power Ltd, Japan to develop 150 mw hydro-electric power project, said it will divest about 20 per cent equity stake to the government of Laos. “Critical project agreements like concession agreement, PPA, IA are under negotiation,” he said adding the project will be ready in four years.

The company is also exploring commercial agro projects in Tanzania and based on the feasibility tests, investments are likely to be committed in FY 2016.

Meanwhile, Nava Bharat Ventures may induct strategic investors in some of its power and mining units in India. “The Board of Directors has approved a proposal, in-principle to restructure the Odisha works into 2 verticals - Ferro Alloy smelters (75,000 TPA for Fe Cr) and power generation unit (94 mw + new 64 mw), with the objective to induct strategic investors so as to make the restructured SPVs as captive units under mining and power regulations,” it said .

It may be noted that the proportion of power sales to the company’s total revenue decreased from 67 per cent in 2009-10 to 49 per cent in 2012-13, while revenue from power sales declined from `827 crore in 2009-10 to `690 crore in 2012-13.

The company is planning to increase its power capacity in India from 228 mw in 2013 to 442 mw in 2014.
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