Reliance Power Offloads Assets To Clear Off Debts
Confirmed reports have come in that Reliance Power is now starting to export of power equipment from its Samalkot project in Andhra Pradesh to its Bangladesh project. This move, it is being confirmed, will help the company pare debt of nearly Rs 1,500 crore.
This is going to be Module 1 of the gas-based power equipment. The capacity of the equipment is 750 MW. According to a senior official, “This equipment is being exported from its Samalkot project. The process of exporting the equipment for the 750 MW LNG-based power project in Bangladesh is expected to be completed by the end of July 2021.”
The Bangladesh project is being developed jointly with a Japanese energy major JERA and Reliance Power. The sale of this equipment is a significant move for Reliance to manage its finances. The project has also achieved financial closure for its first phase of 750 MW generation capacity. Samsung C&T Corporation is the EPC (engineering, procurement, and construction) contractor for the Bangladesh project.
The total US-EXIM debt for the Samalkot project is around Rs 2,500 crore. With the sale of this equipment, Reliance has offloaded some Rs. 1500 crore with the sale of Module 1.
Additionally, there are chances of the remaining two modules to generate sufficient funds for wiping out the remaining debt of Rs 2000 crore and also providing the company with additional funds. RPower had entered into a debt-restructuring agreement with US-EXIM in June 2019, for its debt of Rs 2,430 crore.
All the power plants of Reliance Power remained fully operational despite facing COVID-19-induced challenges. RPower continues to be one of India’s top three private power generation companies with an operating portfolio of around 6000 MW, the official added.