Reliance Power Inks $10 Billion Equipment Deal with Chinese Company

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Researched by Industrial Info Resources (Sugar Land, Texas)--Indian power giant Reliance Power Limited (BSE:532939) (Mumbai) recently announced that the company awarded a $10 billion contract to a Chinese company to supply power plant equipment representing 32,000 megawatts (MW) of capacity.

China's Shanghai Electric Corporation, a part of Shanghai Electric Group Company Limited (HKG:2727) (Shanghai, China) bagged the order to provide boilers, turbines and generators to Reliance Power's coal-fired power plants, including the supply of 42 units of 660 MW each.

The deal was signed in the presence of Reliance Group Chairman Anil Ambani. Reliance Power CEO J.P. Chalasani said, "The strategic cooperation between Reliance Power and a leading global supplier like the Shanghai Electric Corporation will enable faster execution of our projects and will be part of super critical technology. Shanghai Electric Corporation's after-sales support will ensure higher availability and also assure maintenance support through the operating life of our projects."

As part of the deal, Shanghai Electric, a world-class equipment-manufacturing conglomerate, will also provide long-term supply of spare parts; training; support for operations and maintenance; erection; testing and commissioning of the boiler, turbine and generator; and after-sales service.

Reliance Power said that the supply of the boiler, turbine and generator packages had already started and would be completed in the next three years.

The Indian power giant and its subsidiaries have operational and under-development generation capacity of 37,000 MW.

Reliance Power had earlier announced the conclusion of one of the largest fundraisers in India on a project-finance basis that had helped the financial closure for two 4,000-MW ultra-mega power projects at Sasan in Madhya Pradesh and Krishnapatnam in Andhra Pradesh.

Explaining the financial details, Chalasani said the deal will be backed by finance from commercial banks, export credit agencies and other financial institutions in China.

Among institutions that will provide financing are Bank of China, the China Development Bank, The Export-Import Bank of China, and the Industrial and Commercial Bank of China (ICBC).

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