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BHEL, NTPC set up JV

by laxman
September 11th, 2007

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The tussle between generation utility NTPC LTD and equipment supplier BHEL over setting up another manufacturing company appears to have ended with the two public sector firms forming a joint venture to synerise their operations to set up power projects.

NTPC, the country’s largest power utility, and BHEL the biggest engineering and manufacturing firm, have signed an MoU to carry out engineering, procurement and construction, activities in the power sector on mutually beneficial terms.

“Through the JV company, to be owned by BHEL, and NTPC on 50:50 equity participation, the two companies will work jointly to completement their respective core strengths in the power sector,” a statement from BHEL said here on Monday. NTPC and power ministry had earlier partially blamed BHEL for delay in supplying equipments, resulting in slippage of 10th plan capacity addition target of 41,000 mw by nearly 50 percent. BHEL, however, had denied such allegations and instead accused NTPC of not placing contracts on time.Irked by delays in supplying equipment by BHEL, the power ministry had even asked NTPC to get into manufacturing. The company has since then acquired a 44 per cent stake in Transformers and Electricals Kerala and also looked at acquiring Tungbhadra steel Product LTD to enhance itw own manufacturing capacities.

BHEL CMD A K Puri and his NTPC counterpart T Sankarlingam signed the MoU. BHEL has designed and manufactured equipment that accounts for about 70 per cent NTPC’s installed capacity.

“The company has so far supplied state of the art power generating equipments of various ratings corresponding to nearly 19,000 MW for NTPC projects, through international competitive bidding route,” the statement said.

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