Damodar Valley Corpn exploring overseas loans

Kolkata: Damodar Valley Corporation (DVC) is exploring overseas borrowing opportunities to loan-finance its mega Rs 24,000-crore 5,800-MW capacity expansion plan in next three years. DVC currently has a capacity of 2,210 MW, including 80 MW of hydel power.

Predominantly borrowing from domestic sources, DVC became interested in foreign currency borrowing to take advantage of the lower cost of finance. 'We have recently tested our hands with $150 million sanction from SBI's overseas operations. We are now looking forward to the next quarterly review of the monetary policy due in July to devise our future strategy,' the Director Finance, Mr T.K. Gupta, told newspersons here today.

Stating that foreign currency borrowings have become more lucrative in a strong rupee scenario, he said that foreign currency loans were available at 7-7.5 per cent on an average compared to the most competitive domestic borrowing cost of 9-9.5 per cent.

According to Mr Gupta, out of a total loan-finance requirement of Rs 16,000 crore, the corporation has already lined up Rs 5,000 crore finance from PFC.

This apart, the company has signed agreements with PFC for raising a Rs 3,200-crore loan finance for the 1,000 MW capacity augmentation of Kodarma thermal power station. 'We are now awaiting the Centre's approval for firming up the finance,' he added.

This apart, applications for loan-finance have been submitted to PFC and Rural Electrification Corporation (REC) for the proposed 2X600 MW Raghunathpur thermal power plant and the 2X500 MW Durgapur thermal project. Both the projects would require loan finance in the range of Rs 3,200 crore.

Maithon Power order


Meanwhile, Maithon Power Ltd - a 74:26 joint venture between Tata Power and DVC - may revise the capacity of its proposed Maithon Right Bank thermal power plant from 2X500 MW to 3X 350 MW.

According to the DVC Chairman, Mr A.K. Burman, the power equipment major may shortly be awarded the project contract.

According to him, Bokaro Power Supply - a joint venture between DVC and SAIL - is also expected firm up the plan for setting up 2X250 MW thermal capacity later this year. The project is expected to be completed in 2010.