Mukesh Ambani-promoted Reliance Industries (RIL) may foray into nuclear energy after being freed from a non-compete agreement with the Anil Dhirubhai Ambani Group (ADAG) that barred it from investing in some businesses, including power.
“RIL has indicated to the government that it is keen on generation and distribution of nuclear power,” a senior government official said on condition of anonymity.
An RIL spokesperson did not respond to ET’s email query on the subject.
According to industry and official sources, RIL’s nuclear plans are still at a preliminary stage.
The company is believed to be in talks with US-based engineering, construction and project management firm Bechtel Corporation for a possible collaboration.
According to sources, Bechtel has been asked by RIL to carry out a study on whether the nuclear business is feasible for the Indian company.
RIL has a long association with Bechtel, which is helping it to develop its KG-D6 deepwater gas field in the Bay of Bengal. Bechtel has also built RIL’s Jamnagar refinery.
Bechtel India’s managing director could not be contacted.
After the US-India civil nuclear deal, many public and private sector energy firms have contemplated entering the nuclear power business. In the regulatory framework currently in place, domestic private firms can participate in nuclear power generation as a minority partner, another official who deals with nuclear issues said.
According to existing laws, the central government must have at least 51% equity stake in a nuclear power venture through either of its two arms—Nuclear Power Corporation of India (NPCIL) and Bharatiya Nabhikiya Vidyut Nigam (BHAVINI).
These two government-run companies are the only ones authorised to set up nuclear power plants in India and any other firm wanting to enter the nuclear energy business must form a joint venture with them.
The government is considering opening up the sector to private participation, the official said. In February this year, the Prime Minister’s Economic Advisory Council had recommended that private investors should be allowed to own majority stakes in nuclear power-generating companies. But this would be possible only through an amendment to the Atomic Energy Act, 1962.
Public sector power major NTPC is the first company to have signed a joint venture agreement with NPCIL for executing nuclear power projects. It has picked up a 49% stake in the JV while NPCIL has 51% ownership.
It is likely that RIL may also follow the NTPC model. If RIL enters the nuclear energy business, it would be the first private investment in the sector.
Bechtel has designed and built more than half of the US’ nuclear power plants. It has a portfolio of more than 74,000 mw of nuclear design, construction, and operating plant support experience in over 150 plants world-wide. Bechtel has been recently named as the top US contractor for 12 consecutive years by the country’s trade publication Engineering News-Record (ENR).
India has already identified about half-a-dozen locations for setting up nuclear plants. They are in Andhra Pradesh, Gujarat, Haryana, Madhya Pradesh, Maharashtra, Tamil Nadu and West Bengal. The government is also considering new sites such as Mahi-Banswara in Rajasthan, Kaiga and Mannur in Karnataka, and Rajauli in Bihar.
India, which wants to build 10,080 mw of nuclear power generation capacity by 2017, needs private investment to achieve that goal. India’s current nuclear power capacity is 4,560 mw.
Source: Economic Times
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