New Delhi, Sept. 2: The Power Finance Corporation will lend Rs 2,891 crore to Damodar Valley Corporation to fund the extension of Mejia and Chandrapura thermal power projects in Bengal and Jharkhand respectively.

These are two major power projects funded by the PFC in the east. PFC provides technical and financial assistance to state governments and state power utilities for structural reforms.

DVC will install 2x250 megawatt units at each of the two generating stations. The estimated cost of the two projects is about Rs 4,133 crore with an equity of Rs 1,242 crore and a debt of Rs 2,891 crore.

PFC chairman and managing director V.K. Garg said, “The entire debt is being funded by PFC. The projects are scheduled for commission by March 2007, and on completion, the two projects would generate more than 6,000 million units of power per annum.”

A memorandum of understanding was signed between PFC and DVC today for the disbursement of loan for the two projects.

The Mejia power project located near Durgapur in Bengal has an installed capacity of 840 mw. After the planned extension, the total installed capacity of the plant would go up to 1340 mw.

Chandrapura power project, located in Jharkhand, has an installed capacity of 750 mw. Its capacity will go up to 1250 mw following the extension of the units.

“We plan to disburse about Rs 10,000 crore during 2005-06. Out of this, about Rs 4,000 crore has already been disbursed in the last four months,” Garg said.