Emco is likely to delay its two main projects - a power plant near Nagpur and a coal trading business- due to various bottlenecks.

The phase I of the upcoming 540 MW power plant near Nagpur will be delayed by a year as the EPC contractor wants to renegotiate the contract. The contract was given to a Chinese firm in the second half of 2008.

The plant which will be built in two phases of 270 MW each, will have four boilers of 135 MW each. The overall capital expenditure of the plant is estimated at Rs.2,480 crore, to be funded through a debt-equity mix of 80:20. Clearances for the first phase of the project was obtained in the first half of 2008.

The first phase was to be operational by December 2009 and the second unit by December 2010. However, in the current scenario, the company expects the plant to be operational by end-2010 or early-2011.

Meanwhile, Emco's plan to start a coal trading business on a large scale from its Indonesian mines from September 2008, has also been delayed due to certain logistical issues. One of these, was that the mine areas recently experienced a huge rainfall of a magnitude not seen in the last 65 years. The coal mine is in the Kalimantan region of Indonesia and has reserves of 105 million tonne.