Gujarat Alkalies to Set Up 100-Megawatt Gas-Based Power Plant

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Researched by Industrial Info Resources (Sugar Land, Texas)--State-run Gujarat Alkalies & Chemicals Limited (BSE:530001) (Vadodara, Gujarat), in collaboration with Gujarat State Petroleum Corporation Limited (Gandhinagar, Gujarat), intends to set up a 100-megawatt (MW) gas-based power plant in Dahej, Gujarat. According to Gujurat Alkalies Managing Director Guruprasad Mohapatra, the project's cost has been estimated at about $81 million. The gas for the project would be supplied by Gujurat State Petroleum, which has discovered large quantities of gas in southern India's Godavari Basin.

The project, expected to be complete in three years, will make Gujurat Alkalies one of the first state-run organizations to tap natural resources to generate power to the extent of about 63 MW. The project will help the company reduce its grid dependence and save on power costs.

The company recently set up a 23.75-MW windfarm in Moti Sindhodi in Kutch, Gujarat, in an effort to meet its increasing power requirements. Additional windmills with the capacity to generate 40 MW are being set up at the same site at an estimated cost of about $29 million. The windmills are scheduled to be commissioned by the end of 2008.

Gujurat Alkalies has outlined several other plans to set up new plants and expand the capacities of existing plants. The company intends to invest about $527 million to implement the plans. It has invested close to $122 million to debottleneck and ramp up the capacity of its caustic soda production plant from 1,200 tons per day to 2,000 tons per day. The expansion and debottlenecking projects are scheduled to be complete by the end of 2008.

In another project, GACL has formed a joint venture with Gujarat State Fertilizers & Chemicals (BSE:500690) (Vadodara) to promote a phenol project at a cost of about $405 million. Other joint ventures to produce acetone and propylene, and to expand the company's hydroperoxide plant are on the anvil. The agreements are likely to be finalized soon.

A $122 million project is already under way to produce 20 million tons per year of chlormethanes. The project is being undertaken as a 50:50 joint venture with Dow Europe GmbH (Horgen, Switzerland), a wholly owned subsidiary of the Dow Chemical Company (NYSE:DOW) (Midland, Michigan). Registered as Dow-GACL Solvdenture Limited, the joint venture is setting up the Dahej plant, which is expected to be commissioned in 2011. The new plant will provide a 250% increase in India's chlormethanes production.

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