Reliance Power aims financial closure for $1 billion Bangladesh unit

Reliance Power aims to achieve financial closure for its $1 billion LNG-fired power plant in Bangladesh by the end of 2017-18, Chairman Anil Ambani told shareholders.

Reliance Power has signed agreements with Bangladesh Power Development Board (BPDP) to develop 3,000 mw of LNG power units at Meghnaghat near Dhaka and 500 mscfd LNG terminal at Qutubdia Island in Bangladesh. The first phase of 750 mw and the LNG terminal entails investment of $ 1 billion.

“Reliance Power’s 750 mw LNG based power project in Bangladesh being implemented with an investment outlay of $ 1 Billion is expected to achieve financial closure in the current financial year itself. The phase 1 of the project is expected to achieve commercial operation by March 2020,” Ambani told shareholders at the 23rd Annual General Meeting of the company.

The Anil Ambani-led company is setting up this plant by relocating equipment procured for its planned power plant at Samalkot in Andhra Pradesh that was stranded due to lack of gas.

“The Bangladesh project will generate earning in US Dollar for the company as it will get dollar denominated Tariff in this project. Implementation of the project will significantly enhance top line and bottom line of the company,”Ambani said.

Reliance Power has an operating capacity of 5,945 mw of coal, gas, hydro and renewable energy projects.

“The sector is undergoing a consolidation phase and is offering a number of inorganic growth opportunities. Company will continue to explore these to accelerate value accretive growth and exploit synergies with the existing portfolio,” Ambani said.

He said that the company will also look at the opportunities in the commercial coal mining.

“The company has been continuously bringing down its leverage by timely repayment of debts at holding company level and its subsidiaries. Leverage will reduce further with the company’s continued focus on delivering excellence in operating performance in all its special purpose vehicles and efforts to put its gas based capacity on track having achieved a significant milestone with the issuance of Letter of Intent for Phase I of Bangladesh Project,”Ambani said.