Victim of land acquisition troubles, GIPCL shelves 600 MW project, looks for clean energy as an option

Surat, 27 October 2013

The worst thing that has happened in last decade in Gujarat is emergence of missionary/foreign supported/funded and left leaning trouble making groups/NGOs, and so called “RTI activists”. Proposed 600 MW lignite based power project at Dungri in south Gujarat is the latest victim of trouble making groups. According to details available, State-run Gujarat Industries Power Company Ltd (GIPCL) has in its October 2013 board meeting taken a decision to cancel the project mainly due to problems in land acquisition. The company board has decided to cancel Rs. 4,000 crore contract which was assigned to an agency to set up the plant in last April.

The company board in its meeting expressed deep sadness over local protest against company’s 600 MW new plant. There was a feeling that even after doing so much for local villagers through CSR via Development Efforts for Rural Economy and People (DEEP) Trust(established in 1994), the company failed to earn any support during the process of land acquisition. The company has now directed DEEP to get approval before doing any developmental work in set of villages.

The locals are opposition company’s new project citing environment related reasons, disturbance due to trucks that carry lignite from Mangrol-Valia lignite mines, and land acquisition process. Like in every other case, some farmrs have also approached the High Court to oppose the project.

The company board was also apprehensive about implications of the new land acquisition act which may come to effect in January 2014.

The company has now decided to invest the money reserved for proposed project in wind-mill based power project which would be set up possibly in coastal area of Khambhat.

GIPCL was co-promoted in 1985 as a public limited company by GUVNL (the erstwhile Gujarat Electricity Board), Gujarat State Fertilizers and Chemicals Ltd (GSFC), Gujarat Alkalies and Chemicals Ltd (GACL) and Petrofils Cooperatives Ltd.

On May 30, 2010, Chief Minister Narendra Modi had dedicated GIPCL’s 2×125 MW lignite expansion units 3 and 4 , executed by BHEL, at Nani Naroli village under Mangrol taluka of Surat district with an investment of Rs 1,210 crore. The capacity was increased to 500 Mw under the phase-2 of expansions.

The project of developing a 600-Mw lignite based thermal power plant based on CFBC technology was announced in 2012 by company chairman with an aim reach to total generation capacity of 1100 Mw by the third quarter of 2016-17.

In June this year the company issued letter of intent to Lanco Infratech Ltd for implementing a 600 Mw lignite-based power project on engineering, procurement construction (EPC) basis. The company had envisaged an investment of Rs 4200 crore for the project.

The company has its own captive lignite mines at Vastan near Surat. The first lignite-based power plant was commissioned in November 1999, with generation capacity of 250 Mw, which was increased to 500 Mw under the phase-2 of expansions.

The company also has a 145 Mw gas-based combined cycle power plant at Vadodara. The company expanded its capacity and commissioned 165 Mw naphtha and gas-based combined cycle power plant at Vadodara. GIPCL sources natural gas from GAIL and R-LNG from GAIL and GSPC.

For the fiscal 2012-13, GIPCL’s standalone net profits jumped by 85 per cent to Rs 219 crore from Rs 118 crore in the fiscal 2011-12. Company’s standalone total income from operations stood at Rs 1416 crore, up by close to 9 per cent from Rs 1300 crore for the financial year 2011-12.