Crucial meeting tomorrow on Sampur Coal Power Plant

By Santhush Fernando
Sri Lanka Government officials will discuss with their Indian counterparts at a crucial meeting to be held tomorrow in a bid to finalise the much-protracted deal for the construction of the Sampur Coal Power Plant and the High Voltage Direct Current (HVDC) undersea cable link to Anuradhapura.
Treasury and Ceylon Electricity Board (CEB) officials will meet with India`s National Thermal Power Corporation Ltd (NTPC) tomorrow, in order to resolve few issues with regards to the terminology of the agreements. The three agreements will be hopefully signed within two weeks time, a high ranking CEB official told The Nation.
Although Memorandum of Understanding (MoU) on Sampur was entered into in end of 2006, severe opposition from both Indian and Sri Lankan Tamil communities and Indian General Election delayed India from proceeding with it.

The official said that, Power Purchasing Agreement (PPA), Implementation Agreement and Joint Venture Agreement, were ready but there were few unresolved terminology issues.
Terms and Conditions of all three agreements have been already finalised. Once terminology issues are resolved at tomorrow`s meeting, we will immediately move to signing of the agreements. Then a Joint Venture Company has to be incorporated, with both CEB and NTPC each having 50% of shareholding. CEB has to put in US $ 75mn as CEBs equity, while NTPC will contribute an identical sum, he added.

Construction of the coal loading jetty is to be executed by the government and it has already allocated funds under the budget to the Sri Lanka Ports Authority (SLPA) for the purpose. CEB will also call for tenders for the construction of transmission cable network.
Anuradhapura to India HVDC transmission line, which is linked to the Sampur agreements, will also be finalised during this meeting. India wants this to be implemented as soon as possible, since it is interested in purchasing power from Sri Lanka,

Raising US 350mn for the construction of the power plant, which has to be jointly raised by CEB and NTPC, is yet unresolved due to non-finalisation of joint venture agreement, CEB sources told The Nation. However, funds could be obtained from either Asian Development Bank (ADB) or Indian Line of Credit with the intervention of Indian and Sri Lankan Governments.

The 1,000 MW Sampur Power Plant was expected to commence work as early as 2008 June. Under its first stage, 500MW will be supplied to the national grid by 2012. A total of 700 acres of land in the Sampur High Security Zone (HSZ) has been earmarked for the project and the construction is to be carried out by the NPTC under the supervision of CEB.