Wednesday, December 12, 2007

Lanco ends contract with BHEL for power project

The Lanco group has terminated the Engineering Procurement and Construction (EPC) contract with the public-sector Bharat Heavy Electrical Ltd (BHEL) for the 1,015-MW coal-based Nagarjuna Power Project coming up in Mangalore.

Instead, the EPC will now be done within the group, Lanco Infratech Ltd (LITL). LITL has placed the orders for equipment with Chinese company Dongfang Electric Corporation (DEC). DEC is a fully-owned company of the People’s Republic of China.

BHEL, when contacted, confirmed the termination of the EPC contract. BHEL had won the contract against bids from a China machine-building international group — China Non-Metal Enterprises Group consortium. The EPC contract was worth Rs 2,500 crore for BHEL.

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