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* Indian company expects to commence power project in Sri Lanka soon
Mon, Feb 8, 2010, 12:45 pm SL Time, ColomboPage News Desk, Sri Lanka.

Feb 08, Colombo: India's largest power generator NTPC Limited expects to commence the 500-MW coal-based power project in Sri Lanka's Eastern Province by the end of February.

Having completed all the formalities by the NTPC and the Indian government, the company is awaiting the opinion of the Sri Lankan attorney general (AG), NTPC sources told Business Standard.

With the re-election of President Mahinda Rajapaksa the NTPC expects the process to be sped up and to start the project by the end of the month in collaboration with the Ceylon Electricity Board (CEB).

Once the AG's approval is received, NTPC and Ceylon Electricity Board (CEB) are likely to sign a joint venture agreement. An implementation agreement and a coal supply agreement would also be signed.

The USD 500-million project is to be funded with a debt to equity ratio of 70:30. NTPC plans to import coal from Indonesia or South Africa for the proposed project.

NTPC and CEB made the deal in 2006 but the controversy regarding proposed site, Sampur in Trincomalee District and the financial arrangements prevented the implementation of the project.

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