Bangladesh Power Development Board (BPDB) has formally approached the Registrar of Joint Stock Companies & Firms (RJSCF) for establishing the country’s first-ever joint venture (JV) of a state-owned power entity with a foreign firm.
“We have submitted the application to RJSCF for establishment of the JV firm between BPDB and Indian National Thermal Power Company (NTPC),” BPDB Chairman ASM Alamgir Kabir told the FE.
He expressed hope that the JV firm will be registered soon.
The BPDB and NTPC in January this year signed a JV deal to implement a 1,320 megawatt (mw) capacity coal-fired thermal power plant worth US$ 1.5 billion.
The JV agreement was BPDB’s first such deal with any foreign firm to jointly implement any power plant inBangladesh.
If implemented, it would be the largest power plant in the country.
Under the terms of the deal, BPDB and NTPC will establish a JV firm to be registered in Dhaka having 50:50 equity participation to implement the project to be located at Rampal, some 23 kilometres north of Khulna.
The JV firm will float international tender to implement the coal-fired power plant project by an engineering, procurement and construction (EPC) contractor.
Around 70 per cent of the total project cost will be arranged through borrowing from lenders, while the remaining 30 per cent will be shouldered equally by BPDB and NTPC.
Kabir said the power plant will run initially by imported coal, which could be sourced from Australia, Indonesia or South Africa.
Local coal can also be utilised to generate electricity from the plant if the country extracts a significant quantity of coal from its mines, he said.
Electricity generation cost from the power plant might be around Tk 5.0-7.0 per unit, considering the coal prices in international market, he said.
Officials said the most modern ultra super critical pressure technology will be used to generate electricity from the plant.
The power plant will be located on 1,834 acres of land, some 14 km north of the Sundarbans.
The JV power plant will be implemented as part of Bangladesh’s target to generate around 20,000 mw of electricity from coal-fired power plants by 2030, they said.
The idea to build a coal-fired power plant under a JV was first floated following signing of a government to government memorandum of understanding (MoU) between Bangladesh and India in New Delhi on January 10, 2010.
The state-owned BPDB and the NTPC later inked a MoU in August 2010 in Dhaka.
Currently Bangladesh has only one coal-fired power plant having the generation capacity of only 250 mw, which is being run by local coal extracted from the adjacent Barapukuria coalmine.
Bangladesh has five discovered coalmines having the reserve of around 3.0 billion tonnes.
But coal production is limited to only one coalmine at only around 1.0 million mt per year, as the development of local coal is being protested by the people of the country.
The country’s overall electricity generation is now hovering around 5,000 mw against the demand for over 6,500 mw.