India's BHEL Secures $834 Million Equipment Order from Hindalco

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Bharat Heavy Electricals Limited (BSE:500103) (BHEL) (New Delhi) has secured an order from Hindalco Industries Limited (BSE:500440) (Mumbai) to supply power equipment for the latter's upcoming captive power plant in Orissa. As part of the $834.7 million deal, BHEL will supply generators, turbines and boilers, in addition to setting up the core plant package of the captive power plant being developed for Hindalco's Aditya aluminum project in Sambalpur.

BHEL had recently received a similar order for the supply of captive power plant equipment from Hindalco for the 900-megawatt (MW) power facility in Singrauli, Madhya Pradesh, which is associated with the Mahan aluminum project. These orders are said to be the largest captive power plant orders ever awarded in the country. BHEL's manufacturing units in Trichy, Hyderabad, Bhopal, Bangalore and Ranipet will execute these orders. BHEL's Western Power Sector division located in Nagpur will be responsible for the installation of equipment in Singrauli, while the firm's Southern Power Sector division will handle the installation in Sambalpur.

Aditya Aluminum, an integrated aluminum production facility, includes an alumina refinery with a processing capacity of 1 million-1.5 million tons per year, an aluminum smelter unit with an annual output of 260,000-359,000 tons per year, and a 900-MW captive power plant comprising six units of 150 MW each. The smelter is scheduled to commence production by the third quarter of 2011, while the refinery infrastructure is expected to be in place by 2013.

Mahan Aluminum, located in Singrauli, comprises a 359,000-ton-per-year smelter unit and an associated 900-MW captive power plant. The facility is expected to start production by July 2011. Coal feed for the project will be obtained through joint development of an allotted coal block in partnership with the Essar Group (Mumbai). Coal production is set to begin in 2010.

Both the Aditya and Mahan aluminum projects are part of Hindalco's capacity expansion program, which also includes the company's production facilities in Muri, Jharkhand, and Hirakud, Orissa. Production capacity at the Muri alumina refinery is being increased from 110,000 tons per year to 450,000 tons per year. A new captive power plant is being set up to meet the power and steam requirements of the facility. Smelter capacity at Hirakud is being augmented in phases from 100,000 tons per year through 143,000 tons per year to 155,000 tons per year, with corresponding power generation capacity also being increased from 267.5 MW to 367.5 MW. Construction of the 1.5 million-ton-per-year Utkal refinery in Orissa is under way, with bauxite mining slated to commence in 2010 and first alumina output scheduled for July 2011.

In addition, the capacity expansion program at Hindalco's Belgaum refinery to increase production capacity from 350,000 tons per year to 650,000 tons per year is awaiting allotment of bauxite feed. The company also proposes to set up a 359,000-ton-per-year smelter and a captive power plant of 900 MW in Sonahatu, Jharkhand.

Aluminum is often referred to as "congealed electricity" because of the large quantities of power required for smelting alumina. Hindalco's approach to energy management relies on the selection of appropriate technologies for the captive power plants associated with its metal production facilities. The selection criteria include environmental friendliness, reliability of power, minimal dependence on grid power and low cost of operations. In addition, the company has also adopted various indigenous process-optimization techniques to reduce auxiliary power consumption and conserve energy.

View Project Report - 89000858

Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy related markets. For more than 26 years, Industrial Info has provided plant and project opportunity databases, market forecasts, high resolution maps, and daily industry news.