Hyderabad, 14 Aug (PTI): GVK Group’s Shrinagar Hydro Electric Power project that suffered damage due to heavy floods in Uttarakhand in June is in the process of preparing insurance claim for the dent.
Isaac George, Director of Finance and Chief Executive of GVK’s construction business, said the total insurance covers around Rs 2,600 crore for the physical damage, which is when the assets and equipment are damaged physically.
It also covers Rs 400 crore per annum of advance loss of profit policy (which provides insurance cover to meet such contingencies), he said.
“We are working to arrive at a claim figure. The Bharat Heavy Electricals Ltd (BHEL) is still got to give us the cost of equipment damaged. National Insurance is the lead insurer for the power plant,” George told PTI.
Group Chairman G V K Reddy during the recently-held annual general meeting said the company had appointed a Singapore-based consultant to assess the damage and advise.
Reddy said that currently work is going on and the plant will be operational by the first quarter of next year.
GVK is developing a 330 MW hydro project on the river Alaknanda in Tehri/Pauri Garhwal District of Uttarakhand. The construction of this project is nearing completion.
All the civil works are in the advanced stage of completion. It has a 90 metre high (from deepest foundation level) dam, the GVK official had earlier said.
A power purchase agreement has been signed with Uttar Pradesh and 12 per cent output will be given free to Uttarakhand. The project is expected to commission its first unit by second quarter of this year, GVK website said.
“During the recent floods in Uttarakhand, some water entered into the power house at Shrinagar Hydro Electric Power project. Fortunately, there have been no injuries or fatalities. Even as we assess the impact on machinery and equipment, corrective measures (like water evacuation) have already begun,” GVK had said in a statement in June.
“Based on the information available currently, there may be an impact of 2-3 months on the project. We are however, confident of making up to minimise the impact on the project and resolve the issue at the earliest,” it added.
Replying to a query, George said the group is looking to dilute some stake in its Oil and gas business.
“We are looking at investors. For example, British Petroleum and British Gas have evinced keen interest. We will have to find out whether they give us the value for that.
Finally, we want to retain small portion of that,” George said.
The GVK-BHP Billiton consortium emerged as winners of seven deep-water exploration blocks off the west coast of India in the NELP VII. GVK holds 74 per cent stake. While BHP acts as operator of all the blocks, besides holding 26 per cent stake.