Nalco Inks Power Deal with Plant to Fuel New Aluminium Smelting Capacity

India’s National Aluminium Company (Nalco) announced an agreement last week to purchase eighty percent of the power produced by the plant proposed to be built at Gajamara. The US$2.1 billion coal-fired plant is a joint venture between Nalco and National Thermal Power Corporation Limited (NTPC) and is expected to generate 2,400 Mw.

“Nalco will be buying 80 per cent of the power which will be used for feeding our planned greenfield aluminium smelter at Kamakhyanagar close to the site chosen for the power station. Rest of the power will be sold by NTPC to other sources. We will shortly form the JV (joint venture) company for the power project,” explained Nalco’s Chairman and Managing Director T. K. Chand.

According to domestic reports, the power purchase agreement to govern the arrangement is expected to be finalized by the end of the current fiscal year. This project is one of several aluminium-related projects in the region that are expected to revive the economy of the area, boosting industrial growth, and generating employment among skilled, semi-skilled, and unskilled workers.

The plant is to be fueled via coal from mines allocated to Nalco and is likely to send power to the company’s new greenfield smelter being constructed thirty miles away at Kamakhyanagar. The US$1.8 billion smelter is planned to have a nameplate capacity of 600 thousand metric tons per annum once it is fully operational.

In addition to the new plant at Kamakhyanagar, Nalco plans a brownfield expansion at its 460 thousand metric ton smelter at Angul. Nalco is dedicating US$1.5 billion to the expansion, which is expected to add 500 thousand metric tons per annum to the plant’s capacity.

According to the company, the expansion at Angul is intended to pare down the costs of production and take advantage of economies of scale. In addition, state-of-the-art technology will be installed, enhancing energy savings and overall efficiency.



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