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REC, PFC to Lend Rs. 8,520 Cr. to SJVN Thermal for Buxar Power Plant

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REC Ltd. and Power Finance Corporation (PFC) Ltd. have signed an Memorandum of Loan Agreement (MoA) with SJVN’s wholly-owned subsidiary, SJVN Thermal Pvt. Ltd. (STPL). As per this MoA, PFC and REC will lend Rs. 8,520.92 crore as debt for financing SJVN Thermal’s Buxar Thermal Power Project.

This information was given by REC in its press release dated 18th October 2022.

REC and PFC to Fund 100% Debt Requirement of Buxar Thermal Power Plant

Total estimated cost for setting up STPL’s greenfield Buxar Thermal Power Plant has been pegged at Rs. 12,172.74 crore. As per SJVN, this project will be financed by debt and equity in a 70:30 ratio respectively.

The amount to be lent under the aforementioned MoA will cover the entire debt element of the project’s estimated cost.

As per SJVN, financial closure for the Buxar Thermal Power Project was achieved in March 2021.

STPL’s Greenfield Buxar Thermal Power Project

STPL’s Buxar Thermal Power Plant will be a 1,320 MW supercritical thermal power project which is being developed in village Chausa of Buxar District in Bihar. It will have two thermal power generation units of 660 MW capacity each. This project, once commissioned, will generate about 9,828 Million Units (MU) of power annually.

Buxar thermal power project targets to enhance the reliability of power supply in Eastern India.

Progress of the Buxar Thermal Power Project thus Far

Construction work on the Buxar power plant started formally in March 2019 with the laying of its foundation stone by the Indian Prime Minister. Subsequently, L&T was awarded the contract for the development of this project.

In November 2021, SJVN inaugurated the construction work on the second unit of the Buxar Power Plant.

Out of the two 660 MW thermal power units of the plant, the first unit is expected to be operational by June 2023, while the second unit is expected to be ready by January 2024.

According to SJVN, as of 30th September 2022, the cumulative expenditure thus far on the project amounts to Rs. 5,590.32 crore, out of which Rs. 1,070.40 crore has been spent during 2022-23.

About SJVN: Satluj Jal Vidyut Nigam was established in 1988. The company has a portfolio of about 40,998 MW, out of which 2,016.5 MW is under operation, 4,526 MW is under construction, and 16,749 MW is in the pre-construction stage. The remaining 17,707 MW capacity projects have been identified or are under allotment.