New Delhi: The country’s largest power generation company NTPC Ltd wants to bid for an operations and maintenance (O&M) contract in Bangladesh as part of efforts to boost its presence abroad.
“The company is interested in bidding for the Siddhirganj gas-based power project as they (Bangladesh government) are looking for an O&M operator,” said a person associated with the 300MW project, who didn’t want to be identified.
Playing to strengths: NTPC chairman and managing director R.S. Sharma says the firm will undertake operations and maintenance work, though it is yet to decide on the Siddhirganj project in Bangladesh.
An O&M contract is easier to execute than building a power project, and NTPC expects its presence in Bangladesh to make it eligible to bid in other markets, including developed countries. Mint had reported on 16 April that the public sector unit is scouting for O&M contracts in the US and Europe.
“We are interested in bidding for this project as O&M is our strength, and we have to establish our credentials abroad. For O&M, we do not need the government’s approval,” said a senior NTPC executive who didn’t want to be named. The company plans to execute this contract through its consultancy services division, he added.
The World Bank is providing $350 million (Rs1,739.5 crore) credit to the Siddhirganj project, which is southeast of Bangladesh’s capital Dhaka.
“We will go for O&M projects but we are yet to take a decision on this project,” said R.S. Sharma, chairman and managing director, NTPC.
NTPC may also use this association later to secure gas supplies for its projects in India. Bangladesh also has substantial gas reserves of 135.8 billion cu. m., but so far it has resisted calls for export of natural gas. Bangladesh has an installed capacity of 10,000MW and has a very high degree of shortage. In comparison, India has an installed capacity of 147,000MW, of which one-fourth, or 30,144MW, has been set up by NTPC.
“This comes from their strategic strength, which is power plant operations. It is a low-risk strategy than investing in setting up projects. NTPC has a cost advantage,” Shubranshu Patnaik, executive director at consultancy firm PricewaterhouseCoopers had earlier said.
NTPC’s consultancy services division registered a net profit of Rs41.2 crore in the year ended 31 March on a revenue of Rs127.3 crore. It secured orders worth Rs188.8 crore. In that fiscal, NTPC registered a net profit of Rs7,827.4 crore on a revenue of Rs42,182.4 crore.
NTPC’s stock fell Rs2.75, or 1.4%, to Rs13.05 at close on the Bombay Stock Exchange on Friday. The exchange’s benchmark index, Sensex, rose 0.69% to 11,023.09 points.