orissa power consortium ltd Management discussions

ORISSA POWER CONSORTIUM LIMITED ANNUAL REPORT 2005-2006 MANAGEMENT DISCUSSION AND ANALYSIS Construction of Hydro Electric Power Projects: As the members are kindly aware Thai your company is establishing 3 Hydro Electric Power Projects, i.e., 20 MW Samal HEPP, 18 MW Jalaput HEPP and 60 MW Chitrakonda HEPP. Out of these, the execution of Samal HEPP consisting of 5 units of 4 MW each has commenced groundwork from 1st January 2005 in the financial year 2004-05. The current status of these IPPs is brought to the kind information of the members. I. SAMAL HYDRO ELECTRIC POWER PROJECT (5 x 4 MW) = 20 MW: The members are also kindly aware that the PPA has been signed with PTC Ltd. for sale of power for 30 years from the date of commercial operation. The EPC Contract has been awarded to M1s. VATECH EWF Ltd., New Delhi and Transmission Line Contract has been awarded to M/s Jagabandhu Enterprises (P) Limited, Bhubaneswar. M/s. Dr. Hutarew & Partners (I) ltd. are the Engineering Service Consultants for the project. The EPC Contractors have started working on the project since the date of Notice to Proceed and achieved substantial progress though there are certain parameters to be achieved and lagging behind some milestones. During the year under consideration, the Engineering Design of the Project has been nearly completed. During the year the excavation work of the Power house has been completed and the Power House construction started. The Cross Regulator in the Left Bank Canal is under construction. The approvals for the switchyard and the power evacuation have been obtained. The Operation Agreement has been signed with the Water Resource Department of Government of Orissa. As per the Agreement, the WRD will provide the necessary discharge of the water for a period of 30 years. The approval from the NHAI, Bhubaneswar was obtained for the construction of the bridge on the Tail Race on NH23, the contract was awarded and the work started. The work will be carried out as a deposit work by NHAI, Bhubaneswar. The civil construction of the main power house and other associated works including the fore bay and the Tail Race are in progress. Your company is putting all necessary efforts to commission the Generation Units as early as possible. Your company is receiving every kind of support from Govt. of Orissa and Govt. of India authorities in this regard. II. JALAPUT HYDRO ELECTRIC POWER PROJECT (3 X 6 MW) = 18 MW: The Tripartite draft Power Purchase Agreement was approved by the GRIDCO and however, the approval from Govt. of Andhra Pradesh is awaited. As soon as the tripartite PPA is signed, your company will be in a position to commence work on the project. III. CHITRAKONDA HYDRO ELECTRIC POWER PROJECT (2 X 30 MW) = 60 MW: Your company is pursuing with the Govt. of Orissa and Govt. of Andhra Pradesh for an early solution to enter into a tripartite PPA and after receipt of PPA and necessary clearances from the Central Electricity Authority (CEA) work on the project will be commenced.