About a fortnight before the settlement of the family dispute and realignment of "responsibilities" of Anil and Mukesh Ambani, Reliance Energy Ltd chairman and managing director Anil Ambani announced a Rs 68,750 crore (Rs 687.5 billion) investment plan, at Reliance Energy's 76th annual general meeting in Mumbai. A possible indication of the brothers heading towards an amicable settlement.
With the proposed investment plan, the company is looking forward to transforming the power distribution company into a major player in the country's power generation and supply sector. The company came under the control of Reliance's management group just two years ago.
The Reliance 'ownership issue'
Pointing out that the company is currently ranked third among the Indian private companies in terms of net worth {Rs 6,339 crore (Rs 63.39 billion) as on March 31}, Anil Ambani said the company had, in a short period, made rapid strides in improving its operational and financial performance.
Ambani said the company had a comprehensive plan to explore various opportunities in coal, gas, hydro-electric and wind power generation, with a total estimated investment of Rs 68,750 crore (Rs 687.5 billion).
The two major investments in this plan included the Rs 11,000-crore (Rs 110 billion) power project proposed at the Dhirubhai Ambani Energy City near Dadri and the Rs 48,000-crore (Rs 480 billion), coal-based power project in Orissa. The Dadri project is expected to be the world's largest gas-based power generation plant in a single location.
Ambani also said the company had been successful in its bid for the 1,000 Mw Anpara 'C' power project in Uttar Pradesh.
In the hydro power sector, REL recently bagged the 280-Mw Urthing Sobla hydro project in Uttaranchal. The investment for the project was estimated at Rs 1,500 crore (Rs 15 billion), said Ambani.
"The company is also pursuing the 500-Mw, wind-based power projects in phases spread across various states," Ambani added.
In addition, Reliance Energy was also following developments in the nuclear power generation sector and would pursue growth opportunities at an appropriate stage, he said.
In the power transmission sector, REL had already participated in the international bidding process organised by the Power Grid Corporation of India Ltd, for a joint venture in setting up transmission lines for the Parbati and Koldam hydro-electric projects in Himachal Pradesh on a build-operate-own transfer basis. The company anticipates an investment of Rs 750 crore (Rs 7.5 billion) in the project.
For the transmission business, the company has also applied to the Central Electricity Regulatory Commission for obtaining transmission licences for seven schemes and packages, to strengthen transmission systems in the western region. It has earmarked an investment of about Rs 5,000 crore (Rs 50 billion) for undertaking transmission projects in this region.
In addition, the company is also exploring a comprehensive transmission network covering northern India, for the evacuation of power from its 3,740 Mw plant in UP at an estimated outlay of Rs 2,500 crore (Rs 25 billion).
Giving a clear signal that the ownership disputes within the group was heading towards an amicable settlement, Anil Ambani had also announced that Reliance Industries Ltd had agreed to supply natural gas to the proposed 3,740 Mw power project of Reliance Energy Generation Ltd at Dadri. The project is likely to be commissioned by 2008-09.
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