Aided by the Indo-US nuclear deal, public sector giants are eyeing new fortunes in nuclear power. Indian Oil Corp has joined the fray with a plan to enter nuclear power generation.
IOC, a Fortune 500 company and the country’s largest refiner-marketer with $58 billion (Rs 2,85,337 crore) in sales, has informed the government that it would form a joint venture with Nuclear Power Corporation of India (NPCIL). IOC will hold a stake of between 26 and 49 per cent.
The projects listed by IOC for joint participation with NPCIL includes the proposed Rs 14,000-crore nuclear power project at Kakrapar in Gujarat and Rawatbhata in Rajasthan with a capacity of 1,400 mw, the Rs 18,000 crore project at Kundakulam in Tamil Nadu for 2,000 mw and the Rs 28,500 crore project at Jaitpur in Maharashtra for 3,300 mw.
Confirming the move, IOC’s chairman and managing director Sarthak Behuria said, “This is a step towards becoming a integrated energy major.”
“We have held preliminary discussions with NPCIL and are currently working out the modalities,” he said.
A senior Petroleum Ministry official said an investment of Rs 220-825 crore per annum would be required depending on the equity option chosen by IOC. Also the investments would be required for a span of five years beginning 2010, he added.
The official said the company has discussed the proposal with the ministry and IOC’s board on Monday approved plans to have a memorandum of understanding with NPCIL.
“We have asked IOC to concentrate more on its core area of business which includes refinery, petrochemicals and marketing. It has assured us that the fund requirement for equity participation with NPCIL is comparatively small as compared to the investment in core areas,” the official said.
IOC plans capital expenditure of Rs 12,000 crore per year. The nuclear power investment would be less than 7 per cent of this.