Anil to expand power plant

To counter Mr Mukesh Ambani’s claim that Mr Anil Ambani’s Reliance Natural Resources Limited (RNRL) did not have the required infrastructure to use gas from the K-G basin, the latter has embarked on a massive expansion of his Samalkot power project.

From 220 MW, the capacity of the plant is set to be increased to 1,420 MW, a six-fold increase that will make it ready for gas allocation from the K-G basin.

The Samalkot expansion plan enables RNRL to state their case before the Supreme Court for K-G basin gas. Also by increasing capacity, RNRL will be bale to counter allegations that it would trade the gas received from the K-G Basin.

“We are going ahead with the expansion plan to add 1,200 MW at a cost of Rs 5,000 crore. We are awaiting clearance for the expansion,” said a company source. RNRL had been trying to get gas from the D6 block in the K-G basin eastern offshore fields of Reliance Industries Limited at a cost of $2.34 (around Rs 112) per MMBTU (million metric British thermal units). RIL, however, had rejected the price on the ground that the government approved rate was $4.2 (around Rs 201) per MMBTU.

Mr Anil Ambani’s Reliance Infrastructure was buying a total of 0.54 million standard cubic metre per day (mscmd) from the D6 well since May 10, 2009 but the Empowered Group of Ministers (EgoM) had brought the allotment down to 0.19 mscmd for the plan.

Reliance Infrastructure is operating the power plant at Samalkot which was originally set up by BSES which was merged with Reliance Energy five years back. With issues of gas supply from ONGC and Gail, the plant could not operate at full capacity till 2009.

Reliance Infrastructure has already submitted a request to the state government detailing the expansion plans. The company has also requested for allotment of water from the upper stream of the Sir Arthur Cotton barrage, Dowaliswaram near Rajahmundry. “The government has granted permission for drawing an additional 3,936 million gallons per day from Godavari,” said Mr Shailendra Kumar Joshi, principal secretary of the irrigation department.