Tuesday, December 7, 2010

Tehri Hydro in talks with Russia’s HPI for projects in Central Asia

India’s state-run Tehri Hydroelectric Development Corp. Ltd (THDC) is in talks with Russia’s premier Hydro Power Institute (HPI) for setting up projects in Central Asia, which may allow Indian companies to gain a strategic toehold in the region.

“We are in talks with the Hydro Power Institute of Moscow for setting up projects in Central Asia. They have shown interest in partnering with us. They have a long list of opportunities,” said R.S.T. Sai, chairman and managing director, Tehri Hydro.

RusHydro Group, Russia’s biggest hydropower-generating company, owns HPI. This development assumes significance given India’s plan for signing an umbrella agreement with Russia for the energy sector during Russian President Dmitry Medvedev’s visit to India this month.

While RusHydro did not respond to questions emailed on Sunday, Sai said: “The talks are currently on at the company level. Once reasonable progress has been made, we will take the proposal to the government.”

India wants to leverage its historical association with Russia to strengthen its presence in Central Asian countries rich in hydrocarbon reserves. While Tajikistan and Kyrgyzstan have large hydropower potential, Kazakhstan, Turkmenistan and Uzbekistan have considerable hydrocarbon reserves. These countries could help meet India’s appetite for energy sources.

India, heavily dependent on oil imports, has been scouting for energy assets to meet growing demand as the trillion-dollar economy readies for a fresh growth push. At present, it is the world’s fifth largest oil importer, meeting 80% of its needs from overseas. It will become the third largest after the US and China before 2025, according to the International Energy Agency. According to the BP Statistical Review of World Energy, India’s primary energy consumption in 2009 was 469 million tonnes of oil equivalent, or 4.2% of global consumption.

HPI and Tehri Hydro share a long partnership, having worked on the 1,000MW Tehri dam and hydroelectric project in Uttarakhand. The project was implemented as a joint venture of the Indian government and the Uttar Pradesh government with assistance from erstwhile the USSR.

To start with, Tehri Hydro has been offered opportunities in Tajikistan, Sai said.

The Indian government has separately undertaken plans for building of several commercially unviable hydel or hydroelectric projects in Tajikistan, Mint reported on 29 August 2007, as part of efforts to build goodwill.

India is setting up a military base at Aini, Tajikistan. China and Pakistan, too, have been seeking to enhance their influence in the region, with the former already engaged in constructing road projects in Tajikistan. Tajikistan has borders with China, Afghanistan, Uzbekistan and Kyrgyzstan, and is on trade routes to Europe, China and West Asia. This and Tajikistan’s proximity to Pakistan-occupied Kashmir (PoK) make the country important to India from a strategic point of view.

“THDC has worked with the Russians. HPI will be a good reliable partner to get projects in Central Asia because of the institute’s old links with the erstwhile Soviet bloc countries. This can be the starting point of other beneficial ventures,” said former power secretary Anil Razdan.

Central Asia has emerged as a focus area for meeting Indian energy needs. India has plans of getting coal and electricity from the Central Asian nation of Kazakhstan in lieu of building power plants there. State-run ONGC Videsh Ltd, the overseas arm of Oil and Natural Gas Corp. Ltd, plans to acquire a 25% stake in the Satpayev block in the Caspian Sea from KazMunaiGaz JSC, the national oil firm of Kazakhstan.

India is also mulling an opportunity to join a pipeline project that may help it access crude supplies from Central Asia and the Caspian region to Turkey and from there through an undersea pipeline to Israel. India could then take the crude through tankers and avoid the choke points of the Suez Canal. “HPI has a very strong name and a strong presence. You need a visa to make an entry into new markets and such linkages are helpful,” Razdan added.

Hydropower accounts for 37,328MW of India’s 167,278.36MW power generating capacity. India plans to add 16,501.17MW of hydropower capacity by 2012.

Live Mint

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