Barauni Thermal Power expansion hits funding hurdle

It is one of the major projects undertaken by Bihar State utility to reduce dependence on the central sector. But now lenders have stopped disbursing loan finance to the upcoming 2X 250 MW Barauni Thermal Power expansion project.

While Bihar State Electricity Board (BSEB) denies any financial crisis with regard to the Rs 3,000-crore project, contractors associated with the project point to non-payment of dues since December.

BSEB awarded a turnkey contract to BHEL to commission the plant. The public sector gear maker, in turn, awarded a number of sub-contracts in favour of listed entities such as McNally Bharat and Simplex Infra. A BHEL official confirmed that the project execution was facing “some problems” as BSEB was yet to furnish state guarantee to the principal lender Power Finance Corporation (PFC). PFC has released Rs 500 crore to the project earlier this fiscal and, refused further disbursements due to non-availability of state guarantee.




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