Jindal Steel and Power Ltd (JSPL) has wholly acquired Kineta Power, a privately-owned coal-based 1,980-MW power plant in Nellore district of Andhra Pradesh, for an undisclosed sum.
Confirming the deal, JSPL's managing director and CEO, Ravi Uppal, told PTI that the deal was signed 3-4 months ago. It has all statutory clearances, he said.
"Kineta project we have acquired. We wanted to come to Andhra Pradesh, that's why we acquired that site. That is a good site, 8 kms from the sea coastline. It is a virgin site with environment clearance, land title clear," he said.
When asked about the details, he said, "It has clear titles, boundary walls, all statutory clearances are there. The capacity will be between 3 units of 660 MW or 2 units of 800 MW."
However, the company will not be moving ahead with project construction at the moment due to low power demand and "unless some reforms take place in the sector", he said.
Mr Uppal, however, did not disclose the deal value. Industry insiders said the deal would be executed in phases and the project cost would be around Rs 10,000 crore.
They also said that JSPL acquired Kineta Power through Jindal Power and the share purchase agreement was signed with Bangalore-based Kineta Mines and Minerals - the original promoters of the project - on September 4 last year.
JSPL has plans to run the plant on imported coal, they said, adding that the company is currently doing detailed engineering and planning of the project. The company will import coal from its mines in Indonesia and would blend it with the thermal coal produced at its mines in Mozambique.
Terming the deal a very good buy for JSPL, industry insiders said that the project has most of the statutory clearances, including environment and defence.
It also has the locational advantage of having railway station, national highway and Krishnapattnam port in the nearby areas and the deal would increase JSPL's presence in the power-starved Southern India, they said.
Kineta Power was originally promoted by Kineta Minerals and Metals Ltd. The company, headed by V BalaShowry, is primarily engaged in export of iron ore and suppliers of burnt lime, limestone and dolomite etc.
According to Kineta Power's website, the envisaged capacity of the project is 1980 MW and has been divided into 2 stages. Based on super critical technology, the first stage of the project will have 2 units of 660 MW and second stage would have one unit of 660 MW.
The project has about 1,200 acres of land, of which nearly 840 acres have been acquired through Andhra Pradesh Industrial Infrastructure Corporation Ltd.
The Naveen Jindal-led company, JSPL, has over 3,000 MW power production capacity at present, and is executing coal-based projects over 2,000 MW capacity. It also has plans to set up 6,100-MW hydro power generation capacity.