Iron ore miner NMDC, in partnership with power producer IL&FS Energy Development Company (IEDCL), will develop a 500MW coal-fired power plant with an investment of about INR30-bn ($460.9m) at Gonda in the Indian state of Uttar Pradesh.
The two companies are expected to sign a joint venture agreement for the 2x250MW project, which will come up on an area of 600 acres in Turkadih.
The power plant will supply a capacity of about 300MW-350MW to NMDC’s proposed 3 million ton steel mill at Nagarnar in Chhattisgarh.
The remaining 150MW-200MW would be supplied to the state. The steel plant is set to commission in 2015 and would require 420MW of capacity.
NMDC is planning to get E/F grade coal from Northern Coalfields, while C grade coal from its Shahpur East and West coal blocks in the state of Madhya Pradesh.
Speaking on the occasion, Indian Steel Minister Beni Prasad Verma said establishment of the new plant will encourage potential agro-based industries and help in ensuring better living and industrial growth in the region.
Power Minister Jyotiraditya Scindia said the capacity addition would provide electricity to the Gonda area that has seen limited grid connectivity till now.
Initially, NMDC Power and IEDCL would hold 48% and 52% respective interests in the venture.