News Clippings

State to demand 25 per cent of revenues in return for drop in development cess

State to demand 25 per cent of revenues in return for drop in development cess

K'taka for NICE Bidadi deal

Project profits: 7,000 crore over a period of 10 years ? Talks after LS elections

SPECIAL CORRESPONDENT

Bangalore

In what is seen as a calculated move to add much needed money to its coffers, the BS Yeddyurappa Government in Karnataka is reportedly planning to push for a revenue sharing arrangement with the sole executor of the ambitious Bidadi township project, to come up near Bangalore.

The parleys for financial partnership, expected to be held after the Lok Sabha elections, seem more like an after thought on the part of the authorities.

The 2,275-acre urban borough to be set up along the strategic Bangalore-Mysore corridor project is expected to generate up to 7,000 crore in profits over a period of 10 years for its developer Nandi Infrastructure Corridor Enterprises Ltd, aka NICE.

Observers say though the State government has no locus standi to demand its pound of financial flesh – the legal owner of the land being NICE – it is expected to strike an amicable deal by asking for a 25 per cent share in the revenues in return for relaxing the development cess from 10 per cent to around 2-4 per cent.

Sources within the government aver that the government has got its eye set on the township project ever since it sold the land to NICE at a very low rate. Due to its proximity to the Garden City, Bidadi remains a very profitable venture and the government is therefore keen to extract more benefits even at this stage.

The project has suffered a two year delay owing to squabbles with the Bharatiya Janata Party-Janata Dal (Secular) coalition government. The owners of the land, though loath to the idea of a substantial dip in revenues – particularly at a time of economic slowdown – if they allow the government a measure of control at this stage, will be forced to concede to the demands if only to ensure some peace.

CO2 recovery plant from TICB

Tecnimont ICB Pvt. Ltd (TICB) has added another feather to its cap by successfully commissioning a Carbon Dioxide (CO2) Recovery unit for Nagarjuna Fertilizers and Chemicals Limited (NFCL). The plant was formally inaugurated on March 24, 2009 by NFCL Chairman and Managing Director K.S. Raju. The Carbon Dioxide Recovery Unit of NFCL is installed to capture 450 metric tons per day (MTPD) of CO2. The plant was constructed by Tecnimont ICB Pvt. Ltd. (TICB), a leading Engineering, Procurement and Construction (EPC) company in India. Technology was licensed by Mitsubishi Heavy Industries, Ltd. (MHI). The CO2 is recovered from flue gas emitted during the Ammonia production process and the captured CO2 serves as feedstock for urea production. The scope of MHI was for basic know-how and licensing while TICB was vested with Engineering, Procurement and Construction on Turnkey Lumpsum. Due to intensive efforts of NFCL, TICB and MHI the project was completed two months ahead of schedule.

India to revive West Asia under-sea gas pipeline plan

The government is reviving a 10-year-old private sector proposal for an under-sea gas pipeline linking West Asia with India, seeking to plug a chronic demand-supply gap. The $ 3 billion (Rs 15,150 crore), 2,000km pipeline has been proposed by South Asia Gas Enterprise Pvt. Ltd (SAGE), a special project vehicle set up as an equal joint venture between the Siddhomal group, an Indian firm, and UK-based Deep Water Technology Co. A meeting has been scheduled on Thursday between SAGE and the ministry of petroleum and natural gas to discuss the project in detail. A proposed pipeline that would transport gas from Iran through Afghanistan and Pakistan to India has run into problems because of the escalating internal crisis in Pakistan—which has made it difficult to guarantee the safety of such assets—and a deterioration in relations between New Delhi and Islamabad. “We are looking at this route to bring gas to India. The talks are at a preliminary stage,” said a top petroleum ministry official. The second project that has been stuck is a Turkmenistan-Afghanistan-Pakistan-India pipeline. According to initial plans, the pipeline proposed by SAGE will originate from Oman and will end either in Gujarat or Maharashtra. For the gas to be routed to Oman from Qatar and Iran, an additional infrastructure investment of $ 3 billion is envisaged, a SAGE official said. Gas sourced through this will carry an additional transportation tariff, which will accrue to SAGE. It will take five years for the project to be completed and it will have a capacity of 31.1 million standard cubic m of gas a day (mscmd). The expected transportation tariff from the project is $ 1.8 per million British thermal units (mBtu). Currently, natural gas is priced at $ 4.4-$ 4.5 per mBtu in the international market.

WB to relocate steel projects

The Buddhadeb Bhattacharjee government and Coal India Ltd (CIL) has reached an agreement to relocate four big-ticket projects under execution in West Bengal by Videocon Industries, Bhushan Steel, Abhijit Steel and Bengal Aerotropolis Pvt Ltd (BAPL) to non-coal bearing areas. The state government has decided to relocate the project sites of Videocon Industries, Bhushan Steel and Abhijit Steel to non-coal bearing zones. While in BAPL’s case, 400 acre, out of a total 3500 acre originally earmarked for the venture, is being relocated. The decisions were taken on Wednesday at a high-powered meeting between Coal India executives and the state government at Writers Buildings. The latest developments transpired after the Coal India top-brass felt that the four projects in question, if exectued in their original locations, would undermine the the coal behemoths’s extraction activity in the state. All four projects were originally located in coal-bearing areas. Significantly, it was decided at Wednesday’s meeting that land allocation for all four projects would henceforth be done in consultation with Coal India and its subsidiary, Eastern Coalfields Ltd (ECL), if they happen to be in coal bearing zones. Under the original plan, about 2.66 sq km area of the proposed BAPL venture was encroaching into ECL’s turf. But now with the reduction in the project area, only about 0.71 sq km will overlap with ECL’s command area. With regard to the upcoming relocation of projects being executed by Videocon, Bhushan Steel and Abhijit Steel, West Bengal commerce & industry secretary Sabyasachi Sen said: “Though land had originally been identified for these three projects, we did not actually allot it”. Accordingly, state officials believe relocation of these venture to non-coal bearing areas will not be difficult.

Back to Listing