Essar Power is planning to invest around Rs.13,000 crore in power and mining projects during the XI Plan Period (2007-12).

The company proposes to set up 1,000 MW each coal based power projects in Maharashtra and Jharkhand while it has commenced development of 1,200 MW pit head coal based power project in Madhya Pradesh. Essar Power has projected that it will be able to commission 600 MW of the 1,200 MW project in 3 years in Madhya Pradesh. The second phase will be commissioned in 42 months.

The company has been allotted a captive coal mine at Chakla, Jharkhand with the potential coal reserves of 110 million tonne while Essar Power in joint venture with Hindalco has launched development of captive coal mine alloted in Mahan, Madhya Pradesh last year with the coal reserves of 180 million tonne.

In case of Madhya Pradesh mining venture, Essar Power and Hindalco will contribute 50 per cent equity each in the total 30 per cent equity while raise 70 per cent debt. The entire project entails an investment of Rs.400 crore and the JV company will be able to start coal production from 2010.

Essar Power will use 60 per cent coal while the balance 40 per cent by Hindalco. It will develop Chakla coal mine on its own and it will need an investment of Rs.400 crore. The coal to be produced from this mine will be use for its proposed 1,000 MW pit head coal based project in Jharkhand.

Also See:

Essar to set up 1,000 MW power plant in Gujarat (05-Jan-07)