Abu Dhabi National Energy buys 5 per cent stake in 100-mw power project

Abu Dhabi National Energy Company PJSC (TAQA) has acquired 5 per cent stake in a 100 mw-power project being developed by NCC Limited in Himachal Pradesh and is looking to acquire 100 per cent in future, sources said.

Himachal Sorang Power Limited (HSPL), the developer of the 100 MW hydroelectric plant with an estimated cost of nearly Rs 600 crore, is a special purpose vehicle (SPV) formed for implementation of the project by a consortium of NCC and IL&FS.

While NCC held 67 per cent equity in HSPL, IL&FS Engineering held the balance of 33 per cent.

HSPL cannot sell stake more than 40 per cent before the commercial operation date (COD) and the company has taken permission from the Himachal Government for the minority stake sale, according to sources.

"It will take at least nine months to one year (for the total acquisition). According to the agreement HSPL had with Himachal Government, the promoters cannot sell their entire stake until six months after the COD. The COD will take another three to four months," sources told PTI.

Construction of the Sorang hydroelectric project is 90 per cent complete and the plant is expected to begin operations in 2013.

The acquisition of 5 per cent stake was made by TAQA Jyoti Energy Ventures Pvt. Ltd, a joint venture with Mumbai-based power infrastructure company Jyoti Structures Ltd (JSL).

JSL signed a Memorandum of Understanding with TAQA in July 2011 to explore investment opportunities in the sector.

TAQA already operates a 250 MW lignite power station in the Neyveli region of southern India.

"Subject to the satisfaction of certain conditions precedent and compliance with applicable regulatory requirements, TAQA and JSL will progressively acquire 100 per cent of the share capital of HSPL and jointly operate the plant. TAQA will hold a majority stake in the joint venture," sources said.

State-controlled TAQA is a diversified international energy company active in oil & gas, power & water and alternative energy.

NCC is also in the process of divesting stakes in favour of strategic investors in its1, 320-MW, coal-fired power project being jointly developed by city-based infrastructure firm Gayatri Projects near Krishnapatnam in Andhra Pradesh.

In the Rs 7,170-crore project, NCC holds 55 per cent and Gayatri has 45 per cent.

Both are looking at divesting 49 per cent in favour of by retaining majority holding of 51 per cent.