"Our focus now is on the development of Mahan coal block which will provide low-cost fuel source for the power plant," Essar Energy chief executive officer Naresh Nayyar said.
Mahan-I uses a combination of imported coal and coal sourced from Coal India 's e-auction process, while an application has also been made for an interim tapering coal linkage allocation from CIL, the release said.
Coal from these sources will be required until the nearby Mahan coal-block is operational.
Essar Power has received MoEF clearance for stage-1 of the Mahan coal-block. The second 600 MW unit at Mahan-I is expected to begin commercial operation during the first quarter of the next financial year, the release said.
Mahan-1 has investment of USD 1.2 billion and is the company's third coal-fired power project to commence commercial operation during the year, with a total capacity of 2,310 MW.
The Salaya-1 plant, also of 1,200 MW, was completed in June, while the 510 MW Vadinar P2-plant was completed in November. The Vadinar plant is provides power to Essar Oil 's refinery and availability of the coal-fired generation is having a positive impact on refining margins, it said.
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